Allianz Global Investors To Target European Investors From Luxembourg

by Ulrika Lomas, Tax-News.com, Brussels

30 December 2005

Allianz Global Investors, the asset management arm of the German based financial services group Allianz, has announced that it has established a subsidiary in Luxembourg from where it plans to boost its investment fund business targeted at European investors.

Until now, AGI has concentrated on its home market in Germany and in the United States, but chief executive Joachim Faber told the German business daily Handelsblatt that the company plans to expand into more markets during 2006 and is aiming to raise European investment fund assets to EUR100 billion excluding Germany.

Recently, Luxembourg has emerged as an increasingly popular domicile for funds targeting the continental European market. Total net assets in US dollar terms for all collective investment funds domiciled in Luxembourg recorded growth of 25% over the year to 31 December 2004, according to Fitzrovia’s eleventh annual Luxembourg Fund Encyclopaedia. The total number of funds and subfunds rose from 7,444 to 7,777 during the twelve month period as funds industry assets topped $1.5 trillion.

Luxembourg's decision in July 2004 to allow the listing of offshore hedge funds has also made it possible for the jurisdiction to attract offshore funds and to compete on a level basis with Dublin, removing a barrier that had acted as a handicap to the growth of the hedge fund sector in the Duchy in the past.

While Luxembourg is a relative newcomer as a hedge fund domicile, it has nevertheless seen rapid growth in alternative investment fund assets, primarily hedge funds, which more than doubled during 2004 to reach US$18.7 billion by the end of the year.

Faber also told Handelsblatt that AGI would achieve an operating profit approaching EUR1 billion in 2005, adding that the firm's long term goal was to attain 10% annual growth in profits.

Founded in 1890 in Berlin, Allianz, which provides services from asset management and banking to life and health insurance, has more than 60 million clients in more than 70 countries. At the top of the international group is the holding company, Allianz AG, with its head office in Munich.

In fiscal year 2004, Allianz's total revenues amounted to EUR96.9 billion euros. At the end of 2004 Allianz Group had more than one trillion euros in assets under management, of which EUR585 billion were assets managed for third parties.

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