Allianz 1Q Net Profit Falls 98 Percent

Allianz SE, the German investor in Hartford Financial Services Group Inc., is reporting that its net profit fell 98 percent in the first quarter, due mostly to charges on the sale of its Dresdner Bank unit and weaker business at its main insurance divisions.

The Munich-based company said net profit in the January-March period was $40 million compared with a profit of $1.6 billion in the first quarter of 2008.

It booked a loss of $538 million for the quarter on its the sale of Dresdner bank to Germany’s Commerzbank in January. Total revenues for the period fell 36 percent.

Last fall, Allianz invested $2.5 billion in The Hartford at a time when the American insurer was reeling from steep investment losses.

Allianz did not provide a detailed outlook for the current quarter or full year, but said it saw the first signs of recovery in its life and health insurance business during the first quarter.

“Allianz continues to cope successfully with the impact of the ongoing financial markets crisis on our business,” said Helmut Perlet, the chief financial officer of Allianz in the company’s report.

Perlet said the company is strongly capitalized, the investment portfolio is of high quality and liquid, and that Allianz’ operating profitability proves resilient. (AP)