Allianz SE

The stable outlook indicates that, over next two years, we expect Allianz to maintain its strong brand and continue to benefit from robust, diversified income streams from its various, global business activities. Moreover, we anticipate that the group's capitalization will settle in the 'AA' range, according to our risk-based capital (RBC) model. We might lower the ratings if, contrary to our expectations, Allianz' capitalization according to our capital model is likely to remain below the 'AA' range for a prolonged period. We could also consider a downgrade if the group's earnings, and namely the contribution from asset management earnings, substantially weakened. We regard an upgrade as remote, mainly because the group's capitalization is clearly deficient to the 'AAA' range. We

...Allianz SE enjoys a leading role as a global insurance group. Allianz is one of the largest global multiline insurers benefiting from a superb brand and sound reputation. We assume the group will defend its top positions in several segments and countries. In addition to its global diversification, the group benefits from varied business lines across sectors, which includes industrial lines insurance via Allianz Global Corporate & Specialty (AGCS) and trade-credit insurance via Euler Hermes, in addition to traditional lines of insurance business. We anticipate Allianz earnings will be hit by the impact of Covid-19. We expect for 2020 a reduced net income of about 6 billion, hampered by higher claims in the industrial lines due to business interruption. Still, based on our expectation that the macroeconomic environment will improve, we project an improvement of net income. In particular, Allianz continues to benefit from its strong asset management businesses including PIMCO. We regard Allianz's...

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