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Uniqa Insurance Group AG

Quarterly Report Nov 24, 2011

764_rns_2011-11-24_fe27f81b-30cc-49e7-b8f6-b72a57baa28c.pdf

Quarterly Report

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1st to 3rd Quarter Report 2011 UNIQA Versicherungen AG

Group Key Figures

1–9/2011 1–9/2010 Change
€million €million %
Premiums written
Recurring premiums 4,080 3,888 +4.9
Single premiums 480 777 –38.3
Total 4,559 4,665 –2.3
of which savings portion of premiums from unit-linked and index-linked life insurance 453 580 –21.9
Group premiums (according to IFRS)
Property and casualty insurance 1,927 1,817 +6.0
Health insurance 747 727 +2.7
Life insurance 1,178 1,289 –8.6
Total 3,853 3,834 +0.5
Insurance benefits1)
Property and casualty insurance –1,311 –1,319 –0.6
Health insurance –634 –629 +0.9
Life insurance2) –1,097 –1,421 –22.8
Total –3,043 –3,369 –9.7
Operating expenses3)
Property and casualty insurance –644 –603 +6.8
Health insurance –114 –99 +15.1
Life insurance –306 –281 +8.9
Total –1,065 –984 +8.3
Net investment income 147 673 –78.2
Investments 23,611 24,402 –3.2
Profit/loss on ordinary activities4) –181 108
Net profit/loss –134 64
Consolidated profit/loss –120 36
Insured capital in life insurance 72,861 69,213 +5.3

1) Incl. expenditure for deferred profit participation and premium refunds.

2) Incl. expenditure for (deferred) profit participation.

3) Incl. reinsurance commissions and profit shares from reinsurance business ceded.

4) Before extraordinary tax on the financial sector (Hungary).

Key figures UNIQA shares 1–9/2011 1–9/2010 Change
%
Share price as at 30.9. 11.64 14.75 –21.1
High 16.50 15.34
Low 11.56 10.68
Market capitalisation as at 30.9. (€million) 1,664 2,109 –21.1
Earnings per share –0.84 0.26
Information UNIQA shares
Securities abbreviation UQA
Reuters UNIQ.VI
Bloomberg UQA.AV
ISIN AT0000821103
Market segment Prime Market, Vienna Stock Exchange
Trade segment Official trading
Indices ATXPrime, WBI, VÖNIX
Number of shares 142,985,217
Financial Calendar
Preliminary Figures 2011 Week 5, 2012
Group Report 2011 27 April 2012
1st Quarter Report 2012, Embedded Value 25 May 2012
Annual General Meeting 29 May 2012
Ex Dividend Day, Dividend Payment Day 11 June 2012
Half-Year Financial Report 2012 29 August 2012
1st to 3rd Quarter Report 2012 28 November 2012

Group Management Report

  • Developments in operative core business continue to be pleasing
  • Claims and benefits ratio across all lines at 71.1%
  • Combined ratio (before reinsurance) sank to 98.6%
  • Profit/loss (before taxes) at €–181 million due to the write-downs of Greek government bonds.

Economic environment

The economic development in the euro zone has cooled significantly over the first nine months of this year. While showing great promise during the 1st quarter with an increase of 3.2%, the annualised growth rate was only at 0.8% in the 2nd quarter. From August, there was renewed turmoil in the financial markets and the European sovereign debt crisis escalated. Economic representatives and political leaders of the monetary union realised that neither the agreed aid package (€109 billion) nor the initial 21% debt relief were enough to rescue Greece. Furthermore, the risk of infection increased dramatically for large euro countries (Italy, Spain). The economic advance indicators subsequently collapsed and the probability of a recession increased significantly. In addition to this, drastic public austerity measures dampened growth in many euro zone countries. Experts expect a stagnating environment in the core countries during the 3rd quarter, while a contraction of economic activity is expected in the peripheral countries (Greece, Portugal). The growth forecasts for Greece had to be reduced to –5.5% for 2011 and –3% for 2012. The Greek government clearly missed its deficit target during the first seven months of the year, and it became apparent that the original assumptions about the development of public debt were no longer tenable. Consequently, a further austerity package was agreed at the EU summit on 26 October, which included, among other things, debt relief of 50% for Greek government bonds. While the European Central Bank (ECB) raised interest rates by 25 basis points to 1.50% in July, unconventional monetary policy measures in support of individual peripheral countries and banks were required as of August (purchase of government bonds and increase in refinancing operations for banks). In early November, the ECB lowered its key interest rates again to 1.25%. Inflation increased to 3% by September. With an expected calming of the commodity prices, this should, however, subsequently move towards the ECB's inflation target of 2%.

The US economy provided a positive surprise in the 3rd quarter. While economic growth in the 1st half of 2011 was still relatively weak at 1.2% (annualised), gross domestic product (GDP) grew in real terms from July to September by 2.5%. The key factors were strong industrial production and good retail sales. This was aided by low interest rates and expansive geopolitical measures by the American Federal Reserve. Nevertheless, the US is also faced with high public debt of 95% of GDP and the still tense situation in US households dampens domestic demand. The growth outlook thus remains uncertain. Emerging markets are still the driver of global growth. In China, GDP growth between January and September was at 9% in real terms. The other BRICS countries (Brazil, Russia, India, China and South Africa) also recorded high growth rates. It is also expected that, during the economic slowdown, these countries will gain better control over the high inflation caused by the high commodity prices – thus allowing for a "soft landing" of the emerging markets.

In Eastern Europe, the upswing continued over the first six months of the year. In Russia and the Ukraine, growth in real terms was over 3%. Poland grew at an above-average rate of 4.4% compared to the other CEE countries (Czech Republic, Hungary, Slovakia). Due to strong economic interdependence, however, the euro crisis will probably have negative effects on the countries of Eastern Europe during the 2nd half of 2011.

Financial accounting principles, scope of consolidation

The quarterly statement of the UNIQA Group was prepared in accordance with the International Financial Reporting Standards (IFRS) as well as the International Accounting Standards (IAS). This interim report has been prepared in accordance with IAS 34.The scope of fully consolidated companies did not expand significantly as of 30 September 2011.

Premium development

The UNIQA Group's premium written (including the savings portion of the unit- and index-linked life insurance) fell in the first nine months of 2011 due to a 2.3% drop in single premiums of 2.3% to €4,559 million (1–9/2010: €4,665 million). But premiums in the product areas with recurring premiums increased during the period by 4.9% to €4,080 million (1–9/2010: €3,888 million). However, single premiums sank by 38.3% to €480 million (1–9/2010: €777 million).

Premiums earned, including the net savings portions of premiums from unit- and index-linked life insurance to the value of €426 million (1–9/2010: €565 million), sank by 2.7% to €4,279 million (1–9/2011: €4,399 million) in the first three quarters of 2011. The retained premiums earned (according to IFRS) grew by 0.5% to €3,853 million (1–9/2010: €3,834 million).

In Austria, premiums written decreased due to the drop in single premiums by 3.0% to €2,801 million (1–9/2010: €2,889 million). The recurring premium payment business on the Austrian market recorded a very satisfactory increase of 2.7% to €2,694 million (1–9/2010: €2,624 million) in the first nine months of 2011. However, the single premium product business declined by 59.6% to €107 million (1–9/2010: €265 million). In Austria, the retained premiums earned (according to IFRS) grew by 1.6% to €2,348 million (1–9/2010: €2,312 million).

All told, premiums in Eastern and South Eastern Europe sank by 1.7% to €944 million (1–9/2010: €961 million) in the first nine months of 2011.The main reason for this development was the planned strong decline in Polish short-term single premium life insurance policies. Nevertheless, with this result the companies in Eastern and South Eastern Europe still contributed 20.7% (1–9/2010: 20.6%) of Group premiums. The business volume in Western Europe remained in the first three quarters of 2011, despite the strong growth in property and casualty insurance, at €814 million (1–9/2010: €815 million), the same level as last year. The premium share in Western Europe came to 17.9% (1–9/2010: 17.5%). The international portion of the business thus came to a total of 38.6% (1– 9/2010: 38.1%). The retained premiums earned (according to IFRS) of the international companies sank by 1.1% to €1,505 million (1–9/2010: €1,522 million).

Property and casualty insurance

The premium volume written in property and casualty insurance grew in the first three quarters of 2011 by 5.7 % to € 2,120 million (1–9/2010: € 2,006 million). While the premiums in Austria grew by an attractive 3.0 % to € 1,112 million (1–9/2010: € 1,079 million), the premium volume in the Group companies of Eastern and South Eastern Europe grew even more by 7.4 % to € 651 million (1–9/2010: € 607 million).Particularly strong growth of over 10 % was shown here by the markets in Bosnia and Herzegovina, Bulgaria, Croatia, the Czech Republic, Poland, Serbia and the Ukraine. Thus the Eastern and South Eastern European region is already contributing 30.7 % (1–9/2010: 30.2 %) to total Group premiums in property and casualty insurance. In Western Europe, premium revenue increased by 11.2 % to € 356 million (1–9/2010: € 320 million) due to the strong growth in Germany and Italy. The premium share in Western Europe amounted to 16.8 % (1–9/2010: 16.0 %) after three quarters of 2011. In total, the international share rose to 47.5 % (1–9/2010: 46.2 %).

The retained premiums earned (according to IFRS) in property and casualty insurance increased in the first nine months of 2011 by 6.0% to €1,927 million (1–9/2010: €1,817 million).

Health insurance

The premium volume written in health insurance increased in the reporting period by 3.0% to €756 million (1–9/2010: €734 million). In Austria, the premium volume grew by 2.9% to €614 million (1–9/2010: €597 million). Internationally, premiums grew by 3.7% to €142 million (1–9/2010: €137 million) to contribute 18.8% (1–9/2010: 18.7%) to the health insurance premiums of the Group. In Eastern Europe, premium volume in health insurance was already at €17 million (1–9/2010: €12 million) after three quarters of 2011, a growth of 42.4%. In Western Europe, premiums remained at the level of the previous year at €125 million (1–9/2010: €125 million).

The retained premiums earned (according to IFRS) increased in the first nine months of 2011 by 2.7 % to € 747 million (1–9/2010: € 727 million).

Life insurance

In the life insurance line, the premium volume written including the savings portion from the premiums of the unit- and index-linked life insurance decreased in the first three quarters of 2011 due to the drop in single premiums to €480 million (1–9/2010: €777 million) by 12.5% to €1,683 million (1–9/2010: €1,925 million).

However, the premium volume in recurring premium life insurance showed a very positive trend, increasing in the first nine months of 2011 by 4.9% to €1,204 million (1–9/2010: €1,147 million). The risk premium share of unit- and index-linked life insurance included in the premiums totalled €103 million (1–9/2010: €93 million) after the first three quarters of 2011. The insured capital in life insurance as at 30 September 2011 came to a total of €72,861 million (30 Sept. 2010: €69,213 million).

In Austria, the premium volume written in the life insurance line sank by 11.4% to €1,075 million (1–9/2010: €1,213 million) due to the massive decrease in single premiums. Premiums with recurring premium payments increased, however, by 2.1% to €968 million (1–9/2010: €948 million). However, single premiums sank by 59.6% to €107 million (1–9/2010: €265 million). The premium volume written in unit- and index-linked life insurance in Austria also sank in the first nine months of 2011 by 19.7% to €448 million (1–9/2010: €558 million).

In the Western European markets, the life insurance business also decreased further in the first three quarters. In total, due to the strong decline in business in Liechtenstein, premiums written were down by 10.1% to €333 million (1–9/2010: €370 million).The life insurance line in Italy also recorded a minus 4.0%.Overall, the single premium business declined by 15.4% to €254 million (1–9/2010: €301 million). However, recurring premium business recorded an extremely positive growth with an increase of 12.8% to €79 million (1–9/2010: €70 million). Western Europe's share in the Group's life insurance premiums amounted to 19.8% (1–9/2010: 19.2%).

Life insurance was not able to record any gains in Eastern and South Eastern Europe in the first nine months of 2011, either. The UNIQA Group companies' premium volume written in this region declined due to the decrease in single premium business in Poland by 19.4% to €275 million (1–9/2010: €341 million). The single premiums sank by 44.1% to €118 million (1–9/2010: €212 million). However, recurring premiums showed strong growth, rising by 21.1% to €157 million (1–9/2010: €130 million). The premiums in unit- and index-linked life insurance declined in the international area in the first nine months of 2011 by 6.1% to €108 million (1–9/2010: €115 million).

Eastern Europe's share in the Group's total life insurance premiums amounted to 16.4% (1–9/2010: 17.7%). Thus, the international portion came to a total of 36.1% (1–9/2010: 37.0%).

Including the net savings portions of the premiums for the unit- and index-linked life insurance, the premium volume earned in life insurance in the first nine months of 2011 declined by 13.4% to €1,605 million (1–9/2010: €1,854 million). The retained premiums earned (according to IFRS) sank by 8.6% to €1,178 million (1–9/2010: €1,289 million).

Insurance benefits

Because property and casualty insurance had no extraordinary encumbrances due to natural disasters to deal with on the one hand, and on the other because of the reduced investment income, the total amount of retained insurance benefits of the UNIQA Group in the first three quarters of 2011 decreased by 9.7% to € 3,043 million (1–9/2010: €3,369 million). The insurance benefits before reinsurance also sank by 9.5% to € 3,116 million (1–9/2010: € 3,443 million). For this reason, the claims and benefits ratio sank across all insurance lines by 5.5 percentage points, to 71.1% (1–9/2010: 76.6%).

Property and casualty insurance

The loss ratio after reinsurance in property and casualty insurance sank due to the pleasing trend in the first nine months of 2011 to 68.0% (1– 9/2010: 72.6%). Insurance benefits after reinsurance fell by 0.6% to €1,311 million (1–9/2010: €1,319 million) in the reporting period. Benefits before reinsurance decreased by 0.6% to € 1,329 million (1–9/2010: €1,338 million).

Because of the aforementioned developments, and despite one-time expenses associated with the UNIQA Group's repositioning, the combined ratio after reinsurance fell to 101.5% (1–9/2010: 105.8%) in the first three quarters of 2011. Before taking reinsurance into consideration, the combined ratio was still below the 100% mark, amounting to 98.6% (1–9/2010: 102.0%).

Health insurance

The retained insurance benefits (including the change in the actuarial provision) increased marginally in the first nine months of 2011 by 0.9% to €634 million (1–9/2010: €629 million). Therefore, the loss ratio in health insurance sank due to the positive development of premiums to 84.9 % (1–9/2010: 86.4%).

Life insurance

In life insurance, retained insurance benefits (including the change in the actuarial provision) decreased by an enormous 22.8% to €1,097 million (1–9/2010: €1,421 million) because expenses for the deferred profit participation were down due to the lower investment results.

Operating expenses

Total operating expenses for the insurance business, not including reinsurance commissions received, increased in the first three quarters of 2011 by 8.3% to €1,065 million (1–9/2010: €984 million). Acquisition expenses grew in accordance with new business volume by 5.4% to €730 million (1–9/2010: €692 million). Other operating expenses, driven by the climbing social capital expenses (especially for severance payments) and additional one-time expenses associated with the Group's repositioning, grew by 14.9% to a total of €335 million (1– 9/2010: €291 million). As a result of this, the cost ratio, i.e. the relationship of all operating expenses to the Group premiums earned, including the savings portion of the premiums from unit- and index-linked life insurance, and including the reinsurance commissions received, stood at 24.9 % after the first nine months of 2011 (1–9/2010: 22.4%).

Property and casualty insurance

Total operating expenses in property and casualty insurance increased in the reporting period by 6.8% to €644 million (1–9/2010: €603 million). Acquisition costs increased by 5.5% to €423 million (1–9/2010: €401 million). Other operating expenses grew by 9.6% to reach €221 million (1–9/2010: €201 million). The cost ratio in property and casualty insurance was 33.4% (1–9/2010: 33.2%) after the first nine months of 2011, including the reinsurance provisions received.

Health insurance

Total operating expenses in health insurance increased after three quarters of 2011 by 15.1% to €114 million (1–9/2010: €99 million). Acquisition costs increased here by 2.5% to € 67 million (1–9/2010: €65 million). Other operating expenses (including reinsurance commissions received) grew by 39.0% to € 48 million (1–9/2010: €34 million). The cost ratio in health insurance (including reinsurance commissions) thus amounted to 15.3% (1–9/2010: 13.7%).

Life insurance

In life insurance, total operating expenses grew in the first nine months of 2011 by 8.9% to €306 million (1–9/2010: €281 million). Acquisition costs increased by 6.3% to €240 million (1–9/2010: €226 million); other operating expenses were up by 19.4% to € 67 million (1–9/2010: €56 million). Including the reinsurance commissions received, the cost ratio in life insurance climbed to 19.1% as a result of this development (1–9/2010: 15.2%).

Investments

The investment portfolio of the UNIQA Group (including land and buildings used by the Group, real estate held as financial investments, shares in associated companies and the investments of unit- and index-linked life insurance) had decreased as at 30 September 2011 compared to the value on the last balance sheet date by 2.6% to € 23,611 million (31 Dec. 2010: €24,246 million).

Due to the write-down of Greek debt securities amounting to about €318 million, net investment income fell in the first nine months of 2011 by 78.2% to €147 million (1–9/2010: €673 million). In property and casualty insurance, investment results fell by 29.7% to €47 million (1–9/2010: €66 million). In health insurance, results were € –6 million (1–9/2010: €85 million) and life insurance fell by 79.7% to €106 million (1–9/2010: €521 million).

Profit/loss on ordinary activities at €–181 million after three quarters of 2011

The UNIQA Group's profit/loss on ordinary activities (before consideration of the Hungarian special tax on the financial sector) fell in the first nine months due to the write-downs on Greek government bonds, to €–181 million (1–9/2010: €108 million).

In property and casualty insurance, profit/loss (before taxes) after three quarters of 2011 came to €–10 million (1–9/2010: €–39 million). Profit/loss on ordinary activities fell in the health insurance business to €–9 million (1–9/2010: €82 million). In life insurance, pre-tax profit/loss sank to €–161 million (1–9/2010: €65 million).

The net profit/loss came to €–134 million (1–9/2010: €64 million) due to the positive tax effect. Consolidated profit/loss sank to €–120 million (1– 9/2010: €36 million). The earnings per share were at €–0.84 (1–9/2010: €0.26).

Own funds and total assets

The total equity of the UNIQA Group fell by 14.9% in the first nine months of 2011 due to the negative results compared to the last balance sheet date, to reach €1,308 million (31 Dec. 2010: €1,537 million). This included minority interests in the value of €209 million (31 Dec. 2010: €245 million). The Group's total assets as at 30 September 2011 were €28,777 million (31 Dec. 2010: €28,695 million).

Cash flow

Cash flow from operating activities fell in the first three quarters of 2011 to €393 million (1–9/2010: €1,050 million). Cash flow from investing activities of the UNIQA Group, corresponding to the investment of revenue inflow during the reporting period, amounted to €316 million (1–9/2010: €–1,179 million). Due to dividend payments, the financing cash flow was €–62 million (1–9/2010: €–61 million). In total, the amount of liquid funds changed by €–647 million (1–9/2010: €–190 million).

Employees

The average number of employees in the UNIQA Group increased in the first three quarters of 2011 to 15,001 (1–9/2010: 14,978). On 31 December 2010, the average number of employees was at 15,066.

International companies

The premium volume written (including the savings portion of premiums from unit- and index-linked life insurance) outside of Austria decreased slightly during the first three quarters of 2011 by 1.0% to €1,758 million (1–9/2010: €1,776 million).

The premiums of the companies in Eastern and South Eastern Europe sank slightly by 1.7% to € 944 million (1–9/2010: €961 million). In the Central Europe region (CE – Poland, Slovakia, Czech Republic and Hungary), premiums in the first nine months of 2011 declined by 6.8% to €667 million (1–9/2010: €715 million). On the other hand, in the Eastern Europe region (EE) – comprised of Romania and the Ukraine – premium volume written increased by 2.1% to €120 million (1–9/2010: €118 million). In the South Eastern Europe region (SEE – Albania, Bosnia and Herzegovina, Bulgaria, Kosovo, Croatia, Macedonia, Montenegro and Serbia), the first three quarters of 2011 even brought very positive growth from 12.5 % to €137 million (1–9/2010: €122 million). In Russia (RU), premiums grew to €21 million (1–9/2010: €6 million). Eastern Europe's share of Group premiums was 20.7% (1–9/2010: 20.6%) for the first nine months of 2011.

In Western Europe (WE) – Germany, Italy, Liechtenstein and Switzerland – business volume remained at the previous year's level of €814 million (1–9/2010: €815 million). Western Europe's share of premium volume went up to 17.9% (1–9/2010: 17.5%). This put the level of internationalisation of the UNIQA Group at 38.6 % (1–9/2010: 38.1%).

Total retained insurance benefits in the international Group companies decreased by 9.6% to €1,163 million (1–9/2010: €1,287 million) in the first three quarters of 2011. In the Central Europe region (CE), benefits fell by 29.0% to € 350 million (1–9/2010: €493 million), mainly due to the declining single premium business in the life insurance line (above all in Poland). In the Eastern Europe region (EE), however, benefits climbed slightly by 4.1 % to € 85 million (1–9/2010: €81 million). In the South Eastern Europe region (SEE), they also grew by 10.0% to €76 million (1–9/2010: €69 million). In Russia (RU), benefits amounted to €11 million (1–9/2010: €3 million) in the first nine months of 2011. In Western Europe (WE), benefit volume grew marginally by 0.1% to € 641 million (1–9/2010: € 640 million).

Operating expenses, not including reinsurance commissions received, climbed in the international area by 9.9% to € 452 million (1–9/2010: €411 million). In the Central Europe region (CE), costs increased by 11.3% to € 176 million (1–9/2010: €158 million).

In the Eastern Europe region (EE), costs grew slightly by 4.8% to €47 million (1–9/2010: €44 million). In the South Eastern Europe region (SEE), operating expenses grew slightly by 16.3% to €58 million (1–9/2010: €50 million). In Russia (RU), the costs came to €10 million in the first nine months (1–9/2010: €5 million), while they increased by 4.5% to €161 million (1–9/2010: €154 million) in Western Europe (WE).

The net investment income in foreign companies decreased in the first three quarters of 2011 by 21.8% to € 88 million (1–9/2010: €113 million). While the investment results in Western Europe climbed by 13.9% to €51 million (1–9/2010: €60 million), they fell in Eastern Europe by 30.8% to €37 million (1–9/2010: €53 million).

Capital market and UNIQA shares

The 3rd quarter of 2011 was marked by significant share price declines worldwide. Fears of an economic slowdown met with continued concerns about an expansion of the debt crisis and has led to the largest price adjustments in years at numerous stock exchanges. Furthermore, good corporate earnings were unable to do much to stabilise the situation. Discussions about the rating of the USA, political debates over the US debt and partly disappointing economic data caused the DOW JONES INDUSTRIAL (DJI) stock index to record the strongest decline since the 1st quarter of 2009 (–12.1%). The European market index, DJ EURO STOXX 50, recorded an even greater price fall, and is 23.5 % below the half-year figure at the end of the 3rd quarter. The main reason for this weak performance was the price decline of stocks from large European banks with significant exposure to the southern periphery countries. The Japanese NIKKEI 225, which showed declining prices as early as the 1st half of 2011 (earthquakes and nuclear accident), recorded further losses of 11.4% in the 3rd quarter. In spite of favourable conditions, the CEE countries were unable to remain unaffected by the weak performance of European stock markets on the one hand, and the emerging markets on the other: The CECE Index Eastern Europe fell by 29.1% in the 3rd quarter.

The Vienna Stock Exchange was also faced with a weak financial environment in the 3rd quarter of 2011: The stock price declines in the major Western European stock exchanges (the German stock index DAX recorded the largest quarterly loss in nine years) and in the CEE stock markets were reflected in a decline on the ATX by 29.6% to 1,947.85 points. Since the beginning of the year, the Viennese leading index lost a total of 32.9%. As with the DJ EURO STOXX 50, declines in bank shares also contributed to significant adjustments to the ATX index value.

UNIQA shares lost significantly in value – particularly in the 3rd quarter of 2011 – and the share price was €11.64 as of 30 September, 2011. This meant a decrease of 20.8% compared to the beginning of the year. The stock price subsequently fell due to the ongoing turmoil in financial markets and was at €10.20 on 11 November. Thus, the performance in the year 2011 has hitherto declined to –30.6%.

Development of the UNIQA share

Significant events subsequent to the balance sheet date

On 26 October 2011, representatives of the 17 member states of the euro zone worked out another plan to support Greece. See the information in the Group Financial Statements on the recognition and measurement of government bonds from the PIIGS countries as of 30 September 2011.

Outlook

The positive trend in the core operational business continued in the 3rd quarter of 2011 and can also be expected for the end of the current year. However, the special expenditures for the new strategic repositioning of the UNIQA Group and the write-downs of the Greek government bonds will weigh heavily on the profit/loss on ordinary activities this year. For this reason, and assuming that there are no claims due to natural disasters and no further negative developments on the capital markets, the profit/loss on ordinary activities is expected in a range of between €–250 and –300 million.

Consolidated Balance Sheet

Assets 30.9.2011 31.12.2010
€million €million
A. Tangible assets
I. Self-used land and buildings 258 269
II. Other tangible assets 134 139
393 407
B. Land and buildings held as financial investments 1,471 1,465
C. Intangible assets
I. Deferred acquisition costs 914 886
II. Goodwill 582 592
III. Other intangible assets 29 31
1,525 1,509
D. Shares in associated companies 550 546
E. Investments
I. Variable-yield securities
1. Available for sale 1,576 1,752
2. At fair value through profit or loss 588 694
2,164 2,446
II. Fixed interest securities
1. Held to maturity 0 340
2. Available for sale 10,860 11,199
3. At fair value through profit or loss 391 317
11,251 11,856
III. Loans and other investments
1. Loans 2,236 2,442
2. Cash at credit institutions/cash at banks 1,274 864
3. Deposits with ceding companies 139 137
3,649 3,443
IV. Derivative financial instruments 31 28
17,094 17,773
F. Investments held on account and at risk of life insurance policyholders 4,237 4,193
G. Share of reinsurance in technical provisions 705 712
H. Share of reinsurance in technical provisions held on account and at risk of life insurance policyholders 403 397
I. Receivables including receivables under insurance business 1,009 1,007
J. Receivables from income tax 48 46
K. Deferred tax assets 158 106
L. Liquid funds 1,183 533
Total assets 28,777 28,695

To increase transparency in the reporting process, the UNIQA Group has decided to exercise the right stipulated in IAS 19.93A ff concerning balancing the accounts of pension and severance payment provisions, and to implement this change as of 31 December 2010. From now on, the amount of the actuarial gains and losses will therefore be reported as shareholders' equity, after deducting deferred taxes and deferred profit participation, without affecting income. In accordance with IAS 8, the amounts of the previous year have been adjusted to reflect this.

The following parts of these interim financial statements as of 30 September 2011 are, in accordance with IAS 8, affected by the change in the balancing of the accounts of defined benefit plans: consolidated income statement, comprehensive income statement, Group cash flow statement, development of equity, segment reports, earnings per share and the details in the Notes.

1–9/2010 1–9/2010 1–9/2010
after before
change change change
€million €million €million
Consolidated Income Statement
Insurance benefits (net) –3,369 –3,368 –1
Operating expenses –996 –1,005 8
Other expenses –90 –88 –2
Operating profit/loss 132 126 5
Profit/loss on ordinary activities 103 98 5
Income taxes –39 –38 –1
Net profit/loss 64 60 4
of which consolidated profit/loss 36 33 3
of which minority interests 27 27 1
Earnings per share in € 0.26 0.25 0.01

In the classification by region, the changes only have an effect in Austria and on the total in the consolidated financial statements.

Equity and liabilities 30.9.2011 31.12.2010
€million €million
A. Total equity
I. Shareholders' equity
1. Subscribed capital and capital reserves 541 541
2. Revenue reserves 713 731
3. Revaluation reserves –8 –16
4. Actuarial gains and losses on defined benefit plans –27 –22
5. Group total profit/loss –119 58
1,099 1,292
II. Minority interests in shareholders' equity 209 245
1,308 1,537
B. Subordinated liabilities 575 575
C. Technical provisions
I. Provision for unearned premiums 695 595
II. Actuarial provision 16,735 16,480
III. Provision for outstanding claims 2,417 2,392
IV. Provision for profit-unrelated premium refunds 43 49
V. Provision for profit-related premium refunds, i.e. policyholder profit sharing 127 165
VI. Other technical provisions 50 47
20,069 19,728
D. Technical provisions held on account and at risk of life insurance policyholders 4,193 4,143
E. Financial liabilities 59 52
F. Other provisions 724 726
G. Payables and other liabilities 1,530 1,565
H. Liabilities from income tax 16 56
I. Deferred tax liabilities 303 314
Total equity and liabilities 28,777 28,695

Development of Group Equity

Shareholders' equity Minority interests Total equity
1–9/2011
€million
1–9/2010
€million
1–9/2011
€million
1–9/2010
€million
1–9/2011
€million
1–9/2010
€million
As at 1.1. 1,292 1,333 245 232 1,537 1,565
Change in consolidation scope 0 0 –16 –9 –16 –9
Dividends –57 –57 –15 –16 –71 –73
Own shares 0 0 0 0 0 0
Foreign currency translation –21 13 0 0 –21 13
Net profit/loss –120 33 –14 27 –134 60
Unrealised capital gains and losses from
investments and other changes
5 91 9 9 14 100
Income and expenses according to the
consolidated comprehensive income
statement –136 137 –5 35 –141 172
As at 30.9. 1,099 1,413 209 242 1,308 1,656

Consolidated Income Statement

1–9/2011 1–9/2010 7–9/2011 7–9/2010
€million €million €million €million
Gross premiums written 4,107 4,085 1,206 1,230
Premiums earned (net) 3,853 3,834 1,215 1,234
Income from fees and commissions 19 13 5 3
Net investment income 147 673 –131 215
Other income 49 77 8 13
Total income 4,068 4,596 1,097 1,465
Insurance benefits (net) –3,043 –3,369 –969 –1,073
Operating expenses –1,084 –996 –345 –324
Other expenses –92 –90 –25 –25
Amortisation of goodwill –6 –9 –2 –4
Total expenses –4,224 –4,464 –1,341 –1,425
Operating profit/loss –157 132 –244 39
Financing costs –24 –24 –8 –8
Profit/loss on ordinary activities –181 108
before extraordinary tax on the financial sector (Hungary) –252 32
Extraordinary tax on the financial sector (Hungary) –4 –5 –1 –5
Profit/loss on ordinary activities –185 103 –253 26
Income taxes 51 –39 67 –12
Net profit/loss –134 64 –186 14
of which consolidated profit/loss –120 36 –154 –3
of which minority interests –14 27 –32 17
Earnings per share in € –0.84 0.26 –1.08 –0.02
Average number of shares in circulation 142,165,567 142,165,567 142,165,567 142,165,567

The diluted earnings per share are equal to the undiluted earnings per share. Calculated on the basis of the consolidated profit/loss.

Consolidated Comprehensive Income Statement

1–9/2011 1–9/2010
€million €million
Net profit/loss –134 64
Foreign currency translation
Gains (losses) recognised in equity –21 13
Included in the income statement 0 0
Unrealised gains and losses on investments
Gains (losses) recognised in equity 124 279
Gains (losses) recognised in equity – deferred tax 0 –41
Gains (losses) recognised in equity – deferred profit participation –110 –129
Included in the income statement –45 –44
Included in the income statement – deferred tax 0 3
Included in the income statement – deferred profit participation 49 31
Change resulting from valuation at equity
Gains (losses) recognised in equity 6 1
Included in the income statement 0 0
Actuarial gains and losses on defined benefit plans
Gains (losses) recognised in equity –10 –4
Gains (losses) recognised in equity – deferred tax 2 1
Gains (losses) recognised in equity – deferred profit participation 2 –1
Other changes –4 0
Income and expense recognised directly in equity –7 109
Total recognised income and expense –141 172
of which attributable to UNIQA Versicherungen AG shareholders –136 137
of which minority interests –5 35
of which changes in accordance with IAS 8 0 0

Consolidated Cash Flow Statement

1–9/2011 1–9/2010
€million €million
Net profit/loss including minority interests
Net profit/loss –134 64
of which interest and dividend payments 1 5
Minority interests 14 –27
Change in technical provisions (net) 392 1,326
Change in deferred acquisition costs –29 –4
Change in amounts receivable and payable from direct insurance –27 –50
Change in other amounts receivable and payable –55 159
Change in securities at fair value through profit or loss 31 –65
Realised gains/losses on the disposal of investments 293 –287
Depreciation/appreciation of other investments –45 –87
Change in provisions for pensions and severance payments 8 11
Change in deferred tax assets/liabilities –63 46
Change in other balance sheet items 17 –58
Change in goodwill and intangible assets 13 12
Other non-cash income and expenses as well as accounting period adjustments –24 10
Net cash flow from operating activities 393 1,050
of which cash flow from income tax –51 –31
Receipts due to disposal of consolidated companies 0 –1
Payments due to acquisition of consolidated companies –35 –8
Receipts due to disposal and maturity of other investments 6,042 6,714
Payments due to acquisition of other investments –5,646 –7,357
Change in investments held on account and at risk of life insurance policyholders –45 –526
Net cash flow used in investing activities 316 –1,179
Change in investments on own shares 0 0
Share capital increase 0 0
Dividend payments –57 –57
Receipts and payments from other financing activities –6 –5
Net cash flow used in financing activities –62 –61
Change in cash and cash equivalents 647 –190
Change in cash and cash equivalents due to foreign currency translation –1 0
Change in cash and cash equivalents due to acquisition/disposal of consolidated companies 3 0
Cash and cash equivalents at beginning of period 533 798
Cash and cash equivalents at end of period 1,183 607
of which cash flow from income tax –51 –31

The cash and cash equivalents correspond to item L. of the assets: Liquid funds.

Segment Balance Sheet

Classified by segment

Property and casualty Health
30.9.2011 31.12.2010 30.9.2011 31.12.2010
€million €million €million €million
Assets
A.
Tangible assets
174 183 27 29
B.
Land and buildings held as financial investments
285 290 295 289
C.
Intangible assets
543 535 243 238
D. Shares in associated companies 29 28 195 190
E.
Investments
2,941 2,887 2,081 2,198
F.
Investments held on account and at risk of life insurance
policyholders
0 0 0 0
G. Share of reinsurance in technical provisions
232 246 4 3
H. Share of reinsurance in technical provisions held on account
and at risk of life insurance policyholders 0 0 0 0
I.
Receivables including receivables under insurance business
759 770 275 279
J.
Receivables from income tax
42 36 0 1
K.
Deferred tax assets
133 84 2 3
L.
Liquid funds
184 156 378 136
Total segment assets 5,322 5,216 3,501 3,366
Equity and liabilities
B.
Subordinated liabilities
335 335 0 0
C.
Technical provisions
2,908 2,762 2,909 2,787
D. Technical provisions held on account and at risk of life
insurance policyholders 0 0 0 0
E.
Financial liabilities
44 41 27 27
F.
Other provisions
664 658 17 21
G. Payables and other liabilities 921 989 87 86
H. Liabilities from income tax 15 51 1 2
I.
Deferred tax liabilities
220 214 80 76
Total segment liabilities 5,107 5,050 3,120 3,000
Life Consolidation
Group
30.9.2011 31.12.2010 30.9.2011 31.12.2010 30.9.2011 31.12.2010
€million €million €million €million €million €million
191 195 0 0 393 407
891 887 0 0 1,471 1,465
739 737 0 0 1,525 1,509
325 328 0 0 550 546
12,411 13,037 –338 –349 17,094 17,773
4,237 4,193 0 0 4,237 4,193
469 463 0 0 705 712
403 397 0 0 403 397
561 661 –586 –703 1,009 1,007
6 9 0 0 48 46
22 19 0 0 158 106
622 240 0 0 1,183 533
20,879 21,165 –925 –1,052 28,777 28,695
270 270 –30 –30 575 575
14,260 14,174 –8 6 20,069 19,728
4,193 4,143 0 0 4,193 4,143
218 208 –231 –225 59 52
44 46 0 0 724 726
1,179 1,280 –657 –791 1,530 1,565
0 3 0 0 16 56
2 24 0 0 303 314
20,167 20,149 –926 –1,040 27,468 27,159
Shareholders' equity and minority interests 1,308 1,537
Total equity and liabilities 28,777 28,695

The amounts indicated have been adjusted to eliminate amounts resulting from segment-internal transactions. Therefore, the balance of segment assets and segment liabilities does not allow conclusions to be drawn with regard to the equity allocated to the respective segment.

Segment Income Statement

Classified by segment

Property and casualty Health Life Consolidation Group
1–9/2011 1–9/2010 1–9/2011 1–9/2010 1–9/2011 1–9/2010 1–9/2011 1–9/2010 1–9/2011 1–9/2010
€million €million €million €million €million €million €million €million €million €million
Gross premiums written 2,138 2,011 756 734 1,231 1,345 –18 –5 4,107 4,085
Premiums earned (retained) 1,935 1,815 747 727 1,179 1,289 –8 2 3,853 3,834
Income from fees and
commissions 11 11 0 0 10 5 –2 –3 19 13
Net investment income 46 67 –5 85 104 520 1 1 147 673
Other income 42 76 5 4 9 15 –6 –18 49 77
Insurance benefits (net) –1,317 –1,319 –634 –629 –1,097 –1,422 6 0 –3,043 –3,369
Operating expenses –655 –612 –114 –99 –316 –286 2 1 –1,084 –996
Other expenses –70 –57 –6 –5 –37 –41 20 13 –92 –90
Amortisation of goodwill –2 –2 0 0 –4 –7 0 0 –6 –9
Operating profit/loss –10 –21 –8 83 –152 74 13 –4 –157 132
Financing costs –13 –13 –1 0 –10 –10 0 0 –24 –24
Profit/loss on ordinary activities
before extraordinary tax on the
financial sector (Hungary) –23 –35 –8 82 –162 64 13 –4 –181 108
Extraordinary tax on the financial
sector (Hungary) –2 –3 0 0 –2 –2 0 0 –4 –5
Profit/loss on ordinary activities –26 –37 –8 82 –164 62 13 –4 –185 103
Income taxes 40 2 2 –19 9 –22 0 0 51 –39
Net profit/loss 15 –35 –7 63 –155 40 13 –4 –134 64
of which consolidated
profit/loss 14 –44 –5 42 –142 43 13 –4 –120 36
of which minority interests 1 9 –2 22 –13 –3 0 0 –14 27

Classified by region

Premiums earned
(retained)
Net investment income Insurance benefits (net) Operating expenses Profit/loss on ordinary
activities1)
1–9/2011 1–9/2010 1–9/2011 1–9/2010 1–9/2011 1–9/2010 1–9/2011 1–9/2010 1–9/2011 1–9/2010
€million €million €million €million €million €million €million €million €million €million
Austria 2,318 2,282 67 568 –1,880 –2,082 –618 –573 –173 136
Other Europe 1,542 1,549 86 111 –1,169 –1,287 –575 –516 –19 –21
Western Europe 975 934 52 60 –797 –816 –277 –252 –18 –20
Eastern Europe 567 615 34 52 –372 –471 –299 –264 –1 –2
Total before consolidation 3,861 3,831 153 679 –3,049 –3,369 –1,193 –1,090 –192 115
Consolidation (based on
geographic segments)
–8 2 –6 –7 6 0 110 93 12 –7
In the consolidated financial
statements 3,853 3,834 147 673 –3,043 –3,369 –1,084 –996 –181 108
1) Before extraordinary tax on the financial sector (Hungary)

The investment income and profit/loss on ordinary activities by region are presented adjusted for the capital consolidation effects contained in the investment income. The consolidation item includes the expenditure and income consolidation from operational business relations between Group companies on the basis of geographic segments.

Group Notes

Accounting regulations

As a publicly listed company, UNIQA Versicherungen AG is obligated to prepare its consolidated financial statements according to internationally accepted accounting principles. These consolidated interim financial statements for the period ending 30 September 2011, have been prepared in accordance with the International Financial Reporting Standards (IFRS) and the International Accounting Standards (IAS), in the versions applicable to this reporting period. The accounting and valuation principles and consolidation methods are the same as those applied in the preparation of the consolidated financial statements for the 2010 business year.

On 1 July 2008, securities previously available for sale were reclassified according to IAS 39/50E as other loans. Overall, fixed-interest securities with a book value of € 2,130 million were reclassified. The corresponding revaluation reserve as at 30 June 2008 was € –98 million. The market value as at 31 December 2010 was € 1,346 million, the current market value as at 30 September 2011 amounted to € 1,067 million, which corresponded to a change in market value of € –42 million in the first three quarters of 2011. In addition, an amortisation gain of € 135 thousand and an impairment of € 25 thousand was posted in the income statement.

For creation of these consolidated interim financial statements, according to IAS 34.41, estimates are used to a greater extent than as in the annual financial statements.

Scope of consolidation

In addition to the interim financial statement of UNIQA Versicherungen AG, the consolidated interim financial statements include the interim financial statements of all subsidiaries in Austria and abroad. A total of 38 affiliated companies did not form part of the scope of consolidation. They were of only minor significance, even if taken together, for the presentation of a true and fair view of the Group's assets, financial position and income. The scope of consolidation, therefore, contains – in addition to UNIQA Versicherungen AG – 48 domestic and 83 foreign subsidiaries in which UNIQA Versicherungen AG held the majority voting rights.

The scope of consolidation was extended in the reporting period by the following companies:

Date of initial
inclusion
Net profit/loss1)
€million
Acquired shares
%
Acquisition costs
€million
Goodwill
€million
UNIQA Life AD Skopje, Macedonia 1.1.2011 0.0 100.0 3.5 0.0
RHG Management GmbH, Vienna 30.9.2011 0.0 100.0 4.6 0.0

1) Net profit/loss for the period included in the consolidated statements.

Foreign currency translation

The reporting currency of UNIQA Versicherungen AG is the euro. All financial statements of foreign subsidiaries which are not reported in euros are converted, at the rate on the balance sheet closing date, according to the following guidelines:

  • Assets, liabilities and transition of the net profit/loss for the period at the middle rate on the balance sheet closing date
  • Income statement at the average exchange rate for the period
  • Equity capital (except for net profit/loss for the period) at the historic exchange rate

Resulting exchange rate differences are set off against the shareholders' equity without affecting income.

The most important exchange rates are summarised in the following table:

Euro rates on balance sheet closing date 30.9.2011 31.12.2010
Swiss franc CHF 1.2170 1.2504
Czech koruna CZK 24.7540 25.0610
Hungarian forint HUF 292.5500 277.9500
Croatian kuna HRK 7.4995 7.3830
Polish złoty PLN 4.4050 3.9750
Bosnia and Herzegovina convertible mark BAM 1.9558 1.9592
Romanian leu (new) RON 4.3580 4.2620
Bulgarian lev (new) BGN 1.9558 1.9558
Ukrainian hrywnja UAH 10.7219 10.4950
Serbian dinar RSD 101.4600 106.1300
Russian ruble RUB 43.3500 40.8200
Albanian lek ALL 140.0200 139.1900
Macedonian denar MKD 60.7481 62.6973

Notes to the consolidated income statement

Premiums written in property and casualty insurance

1–9/2011 1–9/2010 Change
€million €million %
Direct business
Fire and business interruption insurance 183 167 9.8
Household insurance 163 151 7.6
Other property insurance 194 186 4.3
Motor TPL insurance 505 491 2.9
Other motor insurance 397 375 5.9
Casualty insurance 228 209 8.7
Liability insurance 204 194 5.5
Legal expenses insurance 50 47 5.7
Marine, aviation and transport insurance 98 94 4.1
Other insurance 66 62 6.8
Total 2,088 1,976 5.7
Indirect business
Marine, aviation and transport insurance 3 2 24.9
Other insurance 29 28 3.3
Total 32 30 5.0
Total direct and indirect business (fully consolidated values) 2,120 2,006 5.7

Operating expenses

1–9/2011 1–9/2010
€million €million
Property and casualty
a)
Acquisition costs
Payments 443 418
Change in deferred acquisition costs –20 –17
b) Other operating expenses 230 210
653 611
Health
a)
Acquisition costs
Payments 72 67
Change in deferred acquisition costs –5 –1
b) Other operating expenses 48 34
114 99
Life
a)
Acquisition costs
Payments 247 211
Change in deferred acquisition costs –7 15
b) Other operating expenses 76 60
316 286
Total (fully consolidated values) 1,084 996

Insurance benefits

Gross Reinsurers' share Retention
1–9/2011 1–9/2010 1–9/2011 1–9/2010 1–9/2011 1–9/2010
€million €million €million €million €million €million
Property and casualty
Expenditure for claims
Claims paid 1,234 1,251 –36 –62 1,198 1,189
Change in provision for outstanding claims 59 60 19 44 78 104
Total 1,293 1,311 –17 –18 1,275 1,293
Change in actuarial provisions 4 –2 0 0 4 –2
Change in other actuarial provisions 1 0 0 0 1 0
Expenditure for profit-unrelated and profit-related premium refunds 31 28 0 0 31 28
Total amount of benefits 1,329 1,338 –17 –18 1,311 1,319
Health
Expenditure for claims
Claims paid 497 492 –1 0 496 491
Change in provision for outstanding claims –5 –8 1 0 –4 –8
Total 492 484 0 0 492 484
Change in actuarial provisions 122 126 0 0 122 126
Change in other actuarial provisions 0 0 0 0 0 0
Expenditure for profit-related and profit-unrelated premium refunds 20 19 0 0 20 19
Total amount of benefits 634 629 0 0 634 629
Life
Expenditure for claims
Claims paid 1,124 1,219 –71 –53 1,052 1,166
Change in provision for outstanding claims –13 0 5 1 –8 2
Total 1,111 1,219 –66 –52 1,045 1,167
Change in actuarial provisions 36 87 11 –3 47 84
Change in other actuarial provisions 1 0 0 0 1 0
Expenditure for profit-unrelated and profit-related premium refunds
and/or (deferred) profit participation 5 170 0 0 5 170
Total amount of benefits 1,153 1,476 –56 –55 1,097 1,421
Total (fully consolidated values) 3,116 3,443 –73 –74 3,043 3,369

Net investment income

By segment Property and casualty Health Life Group
1–9/2011 1–9/2010 1–9/2011 1–9/2010 1–9/2011 1–9/2010 1–9/2011 1–9/2010
€million €million €million €million €million €million €million €million
I.
Properties held as investments
5 3 2 5 12 12 19 20
II.
Shares in associated companies
–2 1 9 8 2 11 10 20
III. Variable-yield securities 2 20 –14 7 1 67 –11 94
1. Available for sale 3 18 –11 4 –1 22 –9 44
2. At fair value through profit or loss –1 2 –3 3 2 45 –2 50
IV. Fixed interest securities 22 40 –16 61 84 456 90 557
1. Held to maturity 1 1 2 2 14 14 17 17
2. Available for sale 22 39 –19 57 63 420 66 515
3. At fair value through profit or loss 0 1 1 2 7 22 8 25
V.
Loans and other investments
26 14 20 14 42 41 88 69
1. Loans 19 12 21 16 29 29 69 57
2. Other investments 6 2 –1 –2 13 12 19 12
VI. Derivative financial instruments (held for trading) –6 –4 –4 –8 –22 –59 –32 –71
VII. Expenditure for asset management, interest
charges and other expenses 0 –8 –4 –3 –14 –6 –18 –16
Total (fully consolidated values) 47 66 –6 85 106 521 147 673
By segment and income type Property and casualty Health Life Group
1–9/2011 1–9/2010 1–9/2011 1–9/2010 1–9/2011 1–9/2010 1–9/2011 1–9/2010
€million €million €million €million €million €million €million €million
Ordinary income 92 75 73 73 396 375 562 523
Write-ups and unrealised capital gains 7 17 12 19 176 247 195 283
Realised capital gains 15 42 31 27 167 202 213 271
Write-offs and unrealised capital losses –56 –40 –102 –15 –507 –161 –665 –215
Realised capital losses –11 –28 –21 –19 –125 –142 –158 –189
Total (fully consolidated values) 47 66 –6 85 106 521 147 673

The net investment income of €147 million included realised and unrealised gains and losses amounting to €–415 million, which included currency losses of €45 million. The effects mainly resulted from investments in US dollars. The currency losses in the underlying US dollar securities amounted to roughly €39 million. These losses were compensated by earnings from derivative financial instruments in the amount of €23 million in connection with hedging transactions. In addition, negative currency effects amounting to €14 million were recorded directly under equity.

Information about investments in the PIIGS nations

Issuer Remaining term
of 1–10 years
€million
Remaining term
of 11–20 years
€million
Remaining term
of more than 20 years
€million
Current market value
30.9.2011
€million
Spain 51 21 82 154
Greece 60 86 29 174
Ireland 166 130 0 296
Italy 564 65 198 827
Portugal 6 58 0 64
Total 846 360 308 1,515

Effects of government debt in Greece, Ireland and Portugal that will be aided in the context of rescue packages

The economic and financial crisis caused a significant increase in national debt in Greece, Ireland and Portugal. As a consequence, government bonds and other state bonds in these countries have been shunned on the markets, which is why they have not been able to raise the necessary funds to offset their deficits.

Under these circumstances, the European solidarity guidelines have led the euro zone member states to work together with the International Monetary Fund (IMF) to create supporting measures. These served as the basis for developing and implementing various rescue plans for Greece, and then later for Ireland and Portugal.

In May 2010, the euro zone governments and the IMF pledged to support Greece with a rescue package worth €110 billion. In return, Greece is obligated to reduce its budget deficit. In the 1st half of 2011, European agencies renewed their declarations of support for Greece, preparing a second rescue plan that involves the private sector. During the 3rd quarter of 2011 a number of different plans and scenarios were prepared to help avoid the insolvency of the Greek government. However, as of 26 October 2011, it has been certain that a debt cancellation of at least 50% on the part of the private sector will be necessary.

The rescue package for Ireland was completed in November 2010 in the amount of €85 billion, while support for Portugal in the amount of €78 billion was approved in May 2011. Both rescue plans were financed by public means and are accompanied by strict government debt reduction measures.

Recognition and measurement of government bonds from Greece, Ireland and Portugal as of 30 September 2011

Due to the fact that it is planned for private sectors to be included, UNIQA is assuming that use will be made of the anticipated exchange option and has therefore written down €318 million of the fair value of all its Greek debt certificates.

The difference between the amortised costs and the market value of Irish and Portuguese debt securities, affects mainly the revaluation reserve, reduced by the deferred profit-sharing arrangement (in life insurance) and deferred taxes. After taking into account the various aspects of the European rescue plan, there is no evidence at this time that the backflow of future cash flow associated with these debt instruments are endangered over the long term.

Other disclosures

Employees

Average number of employees 1–9/2011 1–9/2010
Total 15,001 14,978
of which business development 6,120 6,138
of which administration 8,881 8,840

Review

These consolidated quarterly financial statements were neither audited nor reviewed by an auditor.

Imprint

Owner and publisher

UNIQA Versicherungen AG Untere Donaustrasse 21 (UNIQA Tower) 1029 Vienna Austria Commercial registry no.: 92933t Data processing register: 0055506

Investor relations

UNIQA Versicherungen AG Stefan Glinz Untere Donaustrasse 21 1029 Vienna Austria Tel.: (+43) 1 211 75 3773 Fax: (+43) 1 211 75 793773 E-mail: [email protected]

www.uniqagroup.com

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