Allianz SE

The stable outlook is based on our expectation that the group's capitalization will recover to the 'AA' range by end-2021, according to our risk-based model. We also expect that, over the next two years, Allianz will maintain its excellent brand and reputation and continue to benefit from robust diverse income streams from its various global business activities. We could lower the ratings within the next 24 months if, contrary to our expectations, Allianz's capitalization according to our capital model does not improve to the 'AA' level. This could happen, for example, due to substantial costs or provisions associated with the investigation into Allianz Global Investors' Structured Alpha Funds. Furthermore, we might consider lowering the ratings if the group's earnings and,

...Allianz SE is recognized as a globally diversified leading insurance group. As a global player with an excellent brand, Allianz benefits from its market leading position in its domestic market, Germany, as well as sound diversification across business lines and sectors, including Allianz Global Corporate & Specialty (AGCS) and trade-credit insurance via Euler Hermes. Furthermore, Allianz continues to benefit from its complimentary business of asset management. We expect Allianz will maintain its standing as a leading global insurance group. We expect Allianz to generate healthy profits, although the U.S. investigations and potential fines loom large. We view Allianz's diversified earnings streams, supported by its asset-management business (including PIMCO), as a key rating strength compared with other global insurance groups. Its very strong first-half (H1) earnings across all business lines even somewhat exceed our expectations for 2021. Nonetheless, we note that the ongoing U.S. investigation...

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