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FOR IMMEDIATE RELEASE
AMSTERDAM - JUNE 02, 2022 12:33 PM (EDT)
AM Best has affirmed the Financial Strength Rating (FSR) of A+ (Superior) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “aa” (Superior) of Allianz SE (Germany) and its rated subsidiaries (see below for the list of the companies). The outlook of these Credit Ratings (ratings) is stable.
The ratings reflect Allianz SE’s balance sheet strength, which AM Best assesses as strongest, as well as its strong operating performance, very favourable business profile and appropriate enterprise risk management (ERM).
The rating actions follow the announcement on 17 May 2022, that Allianz Global Investors U.S. LLC (AGI U.S.), a subsidiary of Allianz SE, has entered into settlements with the U.S. Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) relating to criminal securities fraud. The settlement agreements highlighted deficiencies in the effectiveness of internal control measures and governance within AGI U.S. As a result, AM Best has revised Allianz SE’s ERM assessment to appropriate from the previous assessment of very strong. AM Best expects the group to undertake decisive measures to address the identified shortcomings in its ERM framework.
The settlement agreements with the DOJ and SEC, which are expected to result in total payments of approximately USD 6 billion (EUR 5.6 billion), resolve uncertainty regarding the financial impact of this matter on the group. Allianz SE had provisioned EUR 3.7 billion at the end of 2021 and EUR 1.9 billion at the end of the first quarter 2022. The group’s strong earnings have allowed it to absorb the financial impact of the settlements. AM Best expects the group to continue to benefit from strong earnings from its diverse operations, including its asset management units.
The FSR of A+ (Superior) and the Long-Term ICRs of “aa” (Superior) have been affirmed with stable outlooks for the following subsidiaries of Allianz SE:
The following Long-Term IRs have been affirmed with stable outlooks:
Allianz Finance II B.V. (debt issues are guaranteed by Allianz SE) —
— “aa” (Superior) on EUR 750 million 3% senior unsecured bonds, due 2028
— “aa” (Superior) on GBP 750 million 4.5% senior unsecured bonds, due 2043
Allianz SE —
— “a+” (Excellent) on EUR 1.5 billion 4.75% perpetual subordinated bonds
— “aa-” (Superior) on EUR 1.5 billion 5.625% subordinated bonds, due 2042
— “a+” (Excellent) on EUR 1.5 billion 3.375 perpetual junior subordinated bonds
This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.