FRANKFURT (Reuters) -Allianz, which has already stopped accepting new business in Russia, will probably fully exit the country, the German insurer’s finance chief said on Thursday.
The statement by Chief Financial Officer Giulio Terzariol goes beyond the company’s announcement in March that it was putting a stop to new insurance in the country as well as new investments in Russia, after the invasion of Ukraine.
“I would define the likelihood as very high,” Chief Financial Officer Giulio Terzariol told reporters when asked about the chances of closing its operations there.
Allianz, in an analyst presentation, said that its bottom line could take a hit of between 400 million euros ($417.44 million) and 500 million euros from a discontinuation of its Russian insurance subsidiaries.
Allianz, which is working to resolve U.S. regulatory investigations into a multibillion-dollar trading debacle at its funds arm, also said on Thursday that net profit fell 78% in the first quarter but confirmed its outlook for 2022 operating profit.
Net profit was 561 million euros in the quarter, down from 2.57 billion euros a year ago.
The net profit figure published on Thursday is more precise and lower than the 600 million euros it announced a day earlier, when it disclosed it would set aside another 1.9 billion euros to deal with its U.S. legal issues.
Analysts, before the announcement of that provision, had initially expected a net profit of more than 1.9 billion euros in the quarter.
Allianz confirmed its outlook for the full year, in which it expects operating profit of 13.4 billion euros, give or take 1 billion.
($1 = 0.9582 euros)
(Reporting by Tom Sims and Alexander Huebner, editing by Kirsti Knolle, Maria Sheahan and Kim Coghill)