Greek writedowns bite Allianz Q2 profit

Allianz missed expectations with a 8.2% drop in net profit in the second quarter, hurt by a writedown on its Greek government debt.
Quarterly net profit after minorities was 1 bln euros ($1.43 bln), Europe's biggest insurer reported on Friday, missing the average of 10 forecasts in a Reuters poll of banks and brokerages for a 23% rise to 1.34 bln euros.
The company took a 326 mln euro hit to net profit in the quarter from a writedown on its 1.3 bln euro portfolio of Greek government debt.
It wrote off about half the value of its Greek sovereign exposure, following a similar move by insurance peer Munich Re on Thursday.
Allianz Chief Executive Michael Diekmann said he was confident of reaching the company's full-year operating profit target of 8 billion euros, plus or minus 500 mln euros.
"The results — be it in the second quarter or for the half-year — are remarkably solid considering the high level of natural catastrophe events, the uncertainty of the capital markets, currency fluctuations and last but not least, the current impairment of our Greek sovereign bond portfolio," Diekmann said in a statement.
One trader calculated that, excluding the Greek bond impairment, net profit would have been 3% higher than expected.
"These are solid results and the unchanged guidance is positive in our view," the trader said.
Allianz posted flat operating profit of 2.3 bln euros in the second quarter, whereas analysts in the Reuters poll on average had expected a 6% decline.
Operating profit in Allianz's main money spinner, property and casualty insurance, rose 16%, helped by rising premiums.
Operating profit in life and health insurance fell by more than 17%, reflecting the Greek bond writedown, while asset management posted a 2.3% rise in operating profit.