Asset Management & Allianz Life

Allianz Capital Markets Day

New York, July 21, 2011 Agenda

G H D C B A E F

Investor Relations contacts Disclaimer from the multi Positioning our clients to benefit Financial performance Product design and risk management Retirement. Allianz Life Customer and distribution view in AGI's universe RCM& AGI Capital as successful entities Allianz Asset Management

– Rethink

Strength and commitment - speed world

what's ahead

–

a success a success story

Giulio Giulio Terzariol Neil McKay C. Bhojwani Gary Jay Ralph Giacomo Campora Andreas Utermann Joachim Faber Mohamed Mohamed El A.

- Erian

New York, July 21, 2011 A

3 2 1

Lookingforward of Drivers success business How we built Allianz’assetmanagement

A 2

© Allianz SE 2011 worldwide … worldwide managers asset leading the of is one Allianz Highlights A. Allianz Asset A.Asset Allianz Management 2) 1) Excluding Corporate / Other Excluding/ Corporate forthfollowing slides diagrams Figuresthein 2010. of end to Figuresrelated Contributing 22% to Allianz Group’s operating profit Strong brands: AGI 89% outperforming assets under management Complete range products of and styles Strong presence all in major markets worldwide One of the world’s largestactive asset managers 1

–

related to AGI AGI relatedto only

–

a success a success story 5 , PIMCO, RCM, PIMCO, , NFJ AGIC,

–

as on as

5) 4) 3) “AGI”companies Allianz “Allianzof Investorsrefers to or Investors”Globalthegroup / Global and shareholders Netincome to attributable 3 - yearoutperformance 3

% AuM bop% AuM (EUR bn) Total net inflows (EUR bn) Total AuM CAGR

+5.0 2006 2006 971 44

+1.2 2007 2007 970 11

+11%

2008 +0.0 2008 920

1,178

2009 +9.6 2009 91

1,499 2010 121 +9.8 2010

(EUR mn) Net income (EUR mn) Operating profit 1,276 CAGR CAGR 2006 2006 395 1,322 2007 2007

470 +23% +12%

2008 2008 369 904 4

1,362 2009 2009

510 PIMCO: PIMCO: Thereof Thereof 78% 2,013 2,013 2010 2010 918

A 3 2

© Allianz SE 2011 organic growth in recent years recent in growth organic strong and beginning the at acquisitions on … built A. Allianz 3) 2) 1) units Asset Management Integration of Allianz 3rd partyAuM

3rd party in as closing 3rddateAuM at EUR bn ManagementAsset Segment year at EUR as In bn 1998

+ EUR 291 bn EUR 291+ 23

Asset Asset Management

1999 1 Acquisition May2000 5, :

- end

2000 3

336

–

a success a success story

+ EUR 36 bn EUR 36 + 2001

January January 31, 2001 564 + EUR 228 bn EUR 228 +

2002 July July 23, 2001

513 Integration 3

2003 3

523

2004 550

2005 707

2006 723 Internal growth

2007 725

2008 673

+ EUR 46 bn EUR 46 + 2009 902 January, January, 2009

2010 1,145 A 4 3

© Allianz SE 2011 part of Allianz’ business model … model business of Allianz’ part integral as management asset rationale: Strategic 2) 1) A. Allianz Contribution to Contribution Group'sfinancials keyAllianz Rationale for AMbusiness . . . . . Return on risk adjusted capital; for 2001 estimated figure for Asset segment figure Asset for risk estimated Managementfor onReturncapital; 2001 adjusted in profit 2002introducedOperating Life Life insurance business Natural hedge to market expertise skills withdeep capital investment management Access to first class strong growth to shareholders with Attractive financial returns for pension market Complementary solutions insurance assets Added value for Asset Management

–

a success story

AGI RoRAC AGI’s operating profit share

2001 n/a

2001 24%

2005 47% 15% 2005

2009 55% 2009 19%

65% 24% 2010 2010

A 5

© Allianz SE 2011 AuM AuM 2010) (EUR bn, Allianz Group of assets in of assets majority to manage Allianz … enabling 1) A. Allianz assets Group Allianz assets party 3rd EUR 1,208bn 3rd party and Group assets PIMCO by assets income (includingmanagedfixedGermany)Group 3rdandpartyEUR 1,208bn

Asset Asset Management 1,699 1,164 535 -

house –

a success a success story

thereof 181 thereof other 354 thereof AGI = 1,499 AGI 1,145 thereof AGI 19 thereof other

. . . .

Allianz Allianz Estate Real e.g. entities, Allianz Capital Partners, otherthrough managed Allianz predominantly assets Group Other PIMCO by of 81% managed assets AGI Allianz AGI’sclient largest Allianz’ making assets, own of ~66% manages AGI Allianz’ assets party3rd of ~98% manages AGI 1

A 6

As December at As 2010 AGI Asia Pacific GmbH) by 50% AllianzSE (50%and held by Joint Venture GmbH AGI Europe(Zurichand Italia SpA SGR branch) AGI FranceAGI of SA, Virtualconsisting unit, entities Simplified, may vary of full legalas name in USA # of investment professionals AGI Capital RCM US RCM PIMCO Asset Management

~430

NFJ

PIMCO Investments PIMCO PIMCO Canada PIMCO

–

a success story AGI US Retail AGI Capital 4

Allianz GlobalAllianz InvestorsFrance

Allianz GlobalAllianz InvestorsItalia AllianzGlobal Investors UK AGI Investments AGI Investments Europe

PIMCO Europe PIMCO (UK) in Europe # of investment professionals RCM UK RCM

Allianz PensionAllianz Partners risklab GlobalAllianz InvestorsLuxembourg GlobalAllianz InvestorsIreland GlobalAllianz InvestorsGermany ~430 2

in Asia Pacific ~160 # of investment professionals RCM Asia Pacific RCM Asia PacificPIMCO AGI Taiwan AGI Singapore AGI Korea AGI Asia Pacific

RCM Australia RCM AustraliaPIMCO RCM Japan RCM Japan PIMCO 3

, … Simplified overview

A 7

© Allianz SE 2011 End End 2001 of … in terms of scale, … of scale, terms … in A. Allianz AuM ranking of world’s largest asset managers (EUR bn) managers world’sasset of ranking largest AuM 10 exchange rates as at end of 2001 applied: 2001 of end at as rates exchange Reserve'sFederalexcludedfromthe of as programbeenmanager havepurchaseMBS engagement theAllianz / AuM to AGI: related Asset Source: (“AuM”)figures from this rankingforderived several are sources publiclyincl. company in reports available/ 4) 3) 2) 1) 3 2 7 6 5 4 1 9 8

Excluding AuM from from businessExcludingAuMprivate banking Only AuM mutual fund business wealthAuMmanagement from asset and AuM OnlyfundU.S. mutual

Fidelity Vanguard AGI AXA AM Deutsche AM Barclays GI State Street Citigroup AM Mellon AM Merrill Lynch IM

Asset Management 1

–

a success story

GBP/EUR 0.60905, USD/EUR GBP/EUR 0.60905,0.88623;

494

571 597 652

753

790

817 830 869 871

exchange rates as at end of 2010 applied: USD/EURapplied: 1.341552010 of end at as rates exchange End End 2010 of 10 3 9 8 7 6 5 4 2 1

Amundi Capital Group J.P.Morgan AM BoNY Mellon AM AXA AM Fidelity Vanguard State GA Street AGI BlackRock GI

for

mation and own analysis. ownandmation

an alysis;

710 743 756

825 878

1,188

1,311 1,491 1,499

2,654 A 8

© Allianz SE 2011 1) Deutsche AM Legg Mason UBS Global AM Schroders Invesco BoNY Mellon AM Morgan Stanley AM AXA AM Amundi Franklin AGI BlackRock GI … and in terms of financial success of financial in terms … and A. Allianz EUR mn, 2010 EUR mn, Peeradjustedoneoccasionallyforfigures

Asset Management

Net Net revenues –

a success story 1,161 - offs / / items extraordinary offs 1,492 1,537 1,517 1,701 1,899 2,021 2,105

2,855

3,051

4,879

6,110

Operating Operating profit 265 314 370 427 443 574 594 602 610

1,623

2,013

2,381

CIR (%) Ø

AGI’s peers: 70 43 59 60 61 63 72 72 75 77 80 80 84

A 9

3 2 1

Lookingforward Driverssuccessof weHowbuilt Allianz’assetmanagementbusiness

A 10

2001 Asset Asset Management

2002

2003

2004 –

2005 a success story

2006

2007

2008

2009

2010 FTE AuM profit Operating

. . . years10 AGI’s first reducing reducing headcount operating profit while Result: AGI more than quadrupled management franchise for Allianz effective and profitable asset decade, AGI nowserves as an Through the evolution in the last acquisitions business as a collection of unrelated Allianz started its asset management

A 11

2001 Asset Management

2002

2003

2004

–

2005 a success story

2006

2007

2008

2009

2010 AuM/FTE Rev/FTE Profit/FTE Operating

. . . . . years10 AGI’s first of of our peer group productivity in the top quartile Result: continually increasing count increased by16% Investment management head has been reduced by16% Over the decade total headcount priority activities the allocation of human capital to A keydriver of success has been our most important resource capital business, with people being Our business is an intellectual

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mark

–

a success story Profitability

On average,

performing 2nd largest asset manager with

AuMat EUR1.5tn pre asset asset manager by 80%of 3rd party assets out “To become the clients’ wealth” enhancing our protecting and - eminent global

over the last decade Quality Size

trust Client

in the last decade cumulated net inflows Almost EUR500bn

A 13

Asia Europe U.S. Global

Asset Asset Management

–

a success a success story AGI AGI Asia Pacific AGI Investments Europe AGI Capital RCM PIMCO

. . . solutions investment well and asbalanced products fixed equityand all major cover Products functions service central leading by supported teams investment autonomous Entrepreneurial, cultures unique investment of strengthening and Preservation - income investment styles, as as styles, investment income - edge infrastructure and edge infrastructure

A 14

© Allianz SE 2011 3rd party account party3rd track strong extremely an “performance”: driver Success 1) A. Allianz AGI 3 1 aspiration Europe Paris, AllianzGI Investments Europe Milan and Allianz Netherlands Asset Management.Asset Allianz NetherlandsandMilan Europe InvestmentsAllianzGI Paris, Europe Singapore,AllianzGITaiwan,AllianzGI 2009: 3Q includeduntil Joint and BranchZurich Europe, InvestmentsAllianzGIat Accountsanalysis. theincluded in is not funds/accountsclosed of performancethe Standards), Performance Investment(Global GIPS underthan Other account. or individual fundeachof benchmark the to compared and appropriatewhere (revaluated)prices closingusing fees of gross is calculated performance accountsall institutional for and funds retail other out mean quartile 2nd and 1st Lipper; or (Morningstar group peer appropriate an of performancemedian theto is compared performancefee of net the funds equityretail some For AGI.of managers income fixedand equitybymanaged includingall accounts benchmark account AGI - - year year 70%

Asset Asset Management - - record … record

based, asset based,

2006 2006 73 87 - Venture GTJA China and in parts WRAP accounts are not considered. Not considered.not accountsare WRAP partsin andChina GTJA Venture -

weighted 3 weighted 2007 2007 AuM: 997bnAuM: 74 86 -

based asset - – year investment performance of third party assets vs. assets partythirdof performance investment year

2008 2008 a success a success story

40 9 4

2009 2009 / 89% of total AuM 81 87

2010 2010 90

AllianzGI Korea, AllianzGI InvestmentsAllianzGI Korea, AllianzGI -

weightedoutperformance 1Q11 1Q11 90 89

performance). For all For performance).

3) 2) Equity Fixed income 3 1 3 1 aspiration aspiration - - - - and AGI IT only recently and retroactively since 4Q08since retroactivelyand recentlyonly IT AGI and FR AGI at income fixed for reporting performance investment regularEstablished 1 withAuM year year year year 70% 70%

- (%) year performance benchmark performance year

2006 2006 2006 2006 62 76 70 91

AuM: 121bnAuM: 875bnAuM: 2007 2007 2007 2007 79 87 72 74

2008 2008 2008 2008

62 48 51 39

2 2

/ 84% of total AuM / 90% of total AuM 2009 2009 2009 2009 63 83 55 92

2010 2010 2010 2010 58 95 63 90

1Q11 1Q11 1Q11 1Q11 69 94 68 92

A 15

Net inflows effects Market Consolidationeffects F/X F/X effect +29 2006 -58 44 47 -4 Asset Asset Management

2007

-60 1 11 57 -8

2008 - 50 -78 28 -1 0 –

a success a success story

2009 +258 129 -16 91 53 EUR bn) EUR

2010 +321 121 55 93 53

Total AuM byregion Europe US Asia Pacific

2006

971 462 436 73

2007

970 466 430 74 CAGR

2008 920 445 416 59

1,178 2009

543 552 83

1,499 2010 598 772 129

+15% +15% +11% +7%

A 16

© Allianz SE 2011 … driving performance fees and revenues … revenues and fees performance … driving Average 2002 Performance fees % in of revenues Major revenue drivers A. Allianz Other net fee inandincome commission bps of total AuM 2006 2006 29.0 3.6

Asset Asset Management - 2010: 5.8% 2007 2007 29.1 6.3

– 2008

2008 28.3

2.9 a success a success story

2009 2009 29.3 11.6

2010 2010 31.7 10.5

Net fee and commission income (EUR mn) Other Other net fee andincome commission Performance fees 2,874 2,768 2006 107

3,060 2,859 2007 201

2,813 2,730 2008 83

CAGR 3,515 3,095 2009 419

4,832 4,321 2010 512

+14% +12% +48% A 17

© Allianz SE 2011 … supported by decreasing share of B of share decreasing by … supported A. Allianz 2) 1) B Keyfigures Net Net income B Operating profit EUR mn - - Net income shareholders Netincome to attributable USD/EURB anddevelopment in growth,assumptions, profit estimate program;subject to particular of operatingregardingend Estimate until 2Q11 units units outstanding unit unit expenses 125,332 2006 Asset Asset Management

105,233 2007

1,276

2006 395 523

79,179

- unit repurchasescheduleunit 2008 –

a success a success story 1,322 2007

470 488

56,224 2009

2008 expenses: expenses: 369 278 904 originally issued

150,000 150,000 units

30,129 Remaining

2010 1,362 2009 510 403

400mn 17,429 1Q11 2,013 2010 918 440

B B - - unit expenses in % of net income unit expenses in % of operating profit 132% 2006 2006 41% - unit costs unit

104% 2007 2007 37%

2008 2008 76% 31%

2009 2009 79% 30% 2

2010 2010 48% 22%

A 18

© Allianz SE 2011 EUR mn pre exceeded crisis, financial the weathered AGI Result: Operating profit A. Allianz 2) 1) Excluding Corporate / Other Excluding/ Corporate shareholders Netincome to attributable CAGR - 1,276 crisis profitability levels already in 2009 … 2009 in already levels profitability crisis 2006 57.3 Asset Asset Management

1,322 CIR (%) CIR 2007 58.4

–

a success a success story +12.1% 2008 67.9 904

1,362 2009 62.2

+47.7%

2,013 2010 58.7

PIMCO: Thereof Thereof 78% 2

Net income 2006 395

1 2007

470

+23.5% 2008 369

2009 510 +80.0%

2010 918

A 19

© Allianz SE 2011 … and delivered against targets against delivered … and A. Allianz ► ► ► ► Exceed market growthExceed market financial returns Attractive market pension for solutions Complementary of 66% / EUR 354bn Group assets Allianz approx. managing meantime in the AGI assets insurance value for Added strong organic growthorganic strong persistent withWorld’s manager asset largest second Trend2011 1Q in confirmed in 2010 1bn of shyincome net EUR 2bn, profit Operating segment Life and AM Progressively effective collaboration between Asset Asset Management –

a success a success story

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3 2 1

Looking Looking forward of Drivers success business weHowbuilt Allianz’assetmanagement

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Absolute returnAbsolute markets Emerging Traditionalalternative vs. passive vs. Active Asset Asset Management –

– and opportunities! and

a success a success story

Focus on Focus onstrong Focus on Focus on Focus

risk solutions capabilities management active - management capabilities management global presence global

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© Allianz SE 2011 We will continue to build on our key strengths key our on to build continue will We ...... will require Continuing success A. Allianz for for the best talent Be the employer of choice allocation management and resource Maintaining discipline in expense demanding clients Adapting to increasingly of our business technology in all aspects Increasing investment in and retirement solutions Providing competitive investment strategies withsustainable alpha Having the right investment Asset Asset Management

–

a success a success story

through through active management Sustainable alpha Strategic positioning Strategic Thought Thought leadership

Performance Performance Plus

& clientreach Clients capabilities Global

Investment &

retirement solutions

provider

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Asset Asset Management

Europe Pacific Allianz Asia Asia U.S. –

a success a success story

...... as as provider of choice managingfor Allianz’ insurance assets Broaden serviceoffer our largestto client Allianz maintain to positioning Expand PIMCO’s ability serveto clients Selectively capture growth opportunities in emerging non / Enhance positioning in the Greater China region Expand PIMCO’s ability serveto clients (governance and legal product structure, portfolio) Further increase organizational efficiency across Europe cost Grow Align set Enhance PIMCO’s delivery of value clients to and market standing retirement U.S. market cooperationin with Allianz Life Build Allianz / brand AGI the in and U.S. strengthen position in the

- up up retail U.S. of sales and client serviceorganization client to requirements - efficiently penetratingby new channels and product areas

- core markets

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Asset Asset Management

...... Ensure Ensure flexibility and efficiency of business set Further position an as AGI employer of choice Enhance Enhance AGI’s positioning as investment and retirement solution provider changes IV) (esp. UCITS III, Harness new opportunities product for innovations arising from regulatory markets and absolute outcome return / Capture opportunities from shifting towardsdemand global and emerging Further broaden PIMCO’s investment solutions and offerings across the capital structure –

a success a success story

- oriented strategies

- up

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© Allianz SE 2011 continuing excellence in all all dimensions in excellence continuing future: the for aspiration Our Achievements 2001 Achievements A. Allianz 1) 2001 2001 2001 Operating profit growth excluding f/x impact profitimpact f/xexcludinggrowthOperating n/a n/a 

28 68% -

2006 2002 2002 Asset Asset Management n/a 7.6

2003 2003 2002 73 6.1 

64% 31

- 2007 2004 2004 6.4 82

–

2005 2005 a success a success story 10.7 – 2003 89 

2010 (in %)2010 (in

62%

- 2006 2006 2008 5.7 87

2007 2007

2004 86 1.7 

62% 11

2008 2008 2009 0.0 49

full full market

2009 2009 11.8 81 2005 Over a Over cycle 

61% 13

- 2010 2010 11.8 2010 87

AGI aspiration AGI  outperformance 3 ≤ 65% CIR 5% growth profit Operating -

year asset weightedasset year 3rd party net inflows inflows net party3rd

–

(over full full cycle) (over 10 % p.a. %

1 ≥ 70 ≥

≥ 5% %

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5% to 22% Contributing Allianz profit Group’s operating class in efficiency Best outperform ability to Proven of part Integral Allianz’ business model managers asset the world’sactive of largest One Asset Asset Management –

10% annual operating profit growth aspiration growthprofit annual operating 10% –

a success a success story

1 2

for continuing excellence! prepared Well

A 27

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© Allianz SE 2011 B A. Allianz 1) of B terms Key . . . . Timing, status quo and outlook . . . . Background - USD/EURB anddevelopment in growth,assumptions, profit estimate program;subject to particular of operatingregardingend Estimate until 2Q11 unit program unit ~ Expected remaining P&L expenses: Allianz mayhave bought all B 17,429 units outstanding end of 1Q11 2000 and 2005 150,000 B B B remaining 15% earnings stream as B Allianz aimed to reduce the OPAD profit sharing to 30% and securitized the of operating profit available for distribution (OPAD) At the time of the PIMCO acquisition in 2000, PIMCO MDs had a right in 45% EUR400mn - - units units can be acquired via put (PIMCO MDs) / call (Allianz) agreement units were issued to PIMCO MDs and represent their priority claim on 15% OPAD Asset Asset Management

- units units issued between - unit program unit 1

- unit repurchasescheduleunit –

a success a success story

units units until 2016

units

. . . . . Drivers of B

USD/EURdevelopment Investment performance Number of outstanding units Put / call treatment OPADdevelopment - unit unit expenses

A 29

© Allianz SE 2011 M A. Allianz Key terms of M terms Key . . Timing, status quo and outlook . . . . Background - If If OPADincreases by M 157,279 options outstanding and 3,651 - - unit program unit Maximum program size are 250,000 M As equity, M otherwise options expire worthlessly After vesting period options translate into M Program started in 2008 via granting of options on M Additional equity incentive plan for PIMCO senior investment / sales staff. - will reach willreach roughly 8.5% minority interests triggered byM amounts annually willamount to low triple digit million P&L expenses for options on M units units issued as per end of 1Q11 Asset Asset Management

- units units represent a share in PIMCO and are held in perpetuity - unit program unit –

a success a success story

~ 85% until 2017

- units -

units

units units and options outstanding - units units only in case of OPADgrowth, . . . Major drivers of M USD/EURdevelopment Number of outstanding units OPADdevelopment - units units

unit unit expenses

A 30

© Allianz SE 2011 PIMCO A. Allianz 3 keyprinciples ...... Investment philosophy and approach and philosophyInvestment 31.12.2010) at (as figures and Facts fund fund thein 240bnover with USD world, AuM Return Total PIMCO’s Fund is the largest mutual asset classes and exposures risk a leading providerof investment solutions across In addition to its fixed expertise, income is PIMCO its newactiveequity lines has PIMCO recentlylaunched the strategy first in managers world is one of PIMCO the leading fixed professionals 1,308 employees, thereof 320 investment Yearfounded: 1971 Assets under management: 967bnEUR 3 2 1

variables analyticsand adjustments to traditional multiple, diversifiedstrategies withvolatility Gaining added valuethrough a combination of achieve a consistent investment performance duration in fixed portionincome of business to Avoidingextreme swingsin eitheror maturity based on long superior shifts Making portfolioin strategy Asset Asset Management

- wide - term trends or secular term

–

a success a success story

- income income

...... Investment strategies Investment Asset Asset allocation Moderate duration Lowduration Long duration yieldHigh Global Equities Emerging markets /CLOCBO income Diversified corporates Investment grade return real Commodity Alternatives asset All Absolute return Duration analysis

Credit

Quantitative Bottom research Top Volatility

...... - Value down techniques return estate Real real Stable value Enhanced cash Total return TR StocksPLUS StocksPLUS return Real Municipals Mortgages Moneymarket - up techniques

added

selection Issue Yield curve

Inv.vehicles . . . . effective effective ETF Privatefunds Mutualfunds accounts Separate trading Sector Cost ´ s

www.pimco.com USA NewportBeach CA 92660, Suite 300 840 Center DriveNewport LLC (PIMCO) Management Company Investment Pacific Contact Zurich Sydney London YorkNew Tokyo NewportBeach (HQ) Offices (co Gross Bill (CEO / co Mohamed El Management

CIO) CIO) Amsterdam Munich Toronto Singapore - Erian -

CIO)

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© Allianz SE 2011 RCM 1) A. Allianz 3. A boutique 3. A boutique culture 2. emphasis An innovative on proprietary research 1. global A truly structure including: The result is company a with many distinctive features, proactively and dynamically clients within partnership from investment management our commitment to engage to It philosophy is a apply that we to all areas our company, of call weInformed” “RCM investment results for the our benefit clients. of A philosophy advantage, we will be to able superior drive and consistent We that believe by generating and exploiting an information . . . .

Investment philosophy and approach Facts and figures (as at 31.12.2010) spectrum for spectrum institutionsand individualclients solutions spanning the cap market and style internationaloffices a rangewith of investment is a global RCM asset manager operating six from professionals 477 employees, thereof 270 investment Yearfounded: 1970 Assets under management: 98bn EUR Assets reported under the brand name RCM brand name underthe Assets reported

Asset Asset Management

–

a success a success story

. . . . . Investment strategies targets, Grassroots targets, Stock selectionStock Stock votes, Price votes, Stock Total Total andreturn asset multi andThematic sector strategies equityEmerging markets Global equitystrategies Regional/ countryequity strategies RIMS, Starmine, RIMS, Identify winners Identify Research Analysts



Value added chain added Value Risk Risk management Portfolio constructionPortfolio Portfolio parametersPortfolio Portfolio managers Portfolio Wilshire, BARRA, Wilshire, Style Research,Style True to label to True FACTSETS



Optimal execution Optimal Implementation

Dealing PLEXUS, PLEXUS, Traders ITG ITG



Performance Performance www.rcm.com London EC2M 3AD, UK 155 Bishopsgate, 1F London office: San Francisco, CA 94105, USA 555 Mission Street RCM Frankfurt Hong Kong San Francisco Rohweder Migliori, Roger Miners,Herold Michael MarkHooper, Konyn, Scott Jacques Garmier, Robert Goldstein, Raymond Chan, Neil Dwane, Andreas Utermann (Global CIO), Udo (Global Frank CEO), Contact Offices Management

Tokyo Sydney London

A 32

© Allianz SE 2011 Allianz Global Investors Capital Investors Global Allianz A. Allianz ...... Investment philosophy and approach Facts and figures (as at 31.12.2010) clientreporting functions service such as management risk and innovationand execution, but also in oversightand to aim beWe best supported byleading entrepreneurial, autonomous investment teams, The of hallmark our structure business is support functions investment processes, talent development and the deliberatedesign of our organizational structure, and throughclarity deliverAGI Capitalreliabilitywill risk management management risk and technology service, legal/ compliance, marketing, operations, collaborationamong business development, client Oppenheimer Capitalto allow a closerworking Nicholas successful integration Investment of Group, NFJ GlobalAllianz InvestorsCapitalreflects the 272 employees, thereof 92 investment professionals Yearfounded: 2010 Assets under management: 37bn EUR Asset Asset Management - ApplegateCapital Management and

- in

- - class, not class, onlyinvestment in edge infrastructure –

a success a success story

...... Products Investment strategies systematic Emerging markets Convertibles High yield Micro ultra / growthmicro Small SMID/ cap growth cap Midgrowth Large growthcap Long equity short / Tail Portable alpha Absolute return Systematicequity Non valueNFJ equity Income and growth equityGrowth Alternatives - risk risk hedging - US equityUS

...... Non Growthsystematic core / systematic Large/mid/small/SMID Non Non Global growth Non Small value cap cap Midvalue Large value cap

- - - - US / global US global / systematic US small growthcap US growth US global / value

www.allianzgic.com 92101,CA USA San Diego 600 BroadwayW. CapitalLLC GlobalAllianz Investors Contact London York New Dallas San Diego (HQ) Offices Geoff (MD) Mullen Ben (MD) Fischer Barbara Claussen (MD) Horacio Valeiras(CIO) Marna Whittington (CEO) Management

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© Allianz SE 2011 ( segment AM figures Key A. Allianz *) Cost income ratio (% / Δ%-p) / ratio(% income Cost shareholdersattributable- to non-controllingattributable- to interests income Net Incometaxes Incomebefore tax thereof- related expenses acquisition Non-operatingitems Operatingprofit Operatingrevenues thereof- performance feees income fee Net and commission figuressegment AM Key - f/x effects f/x - Conso-effects effects Market - flowsNet- (e.o.p.) AuM Total Δ%-p) / (% clients institutional/retail Split - Δ%-p)* / (% DE/AP/other ex US/DE/EU Split - effects f/x - Conso-effects effects Market - flowsNet- (e.o.p.) AuM party 3rd P&Lmn / inEURAuMbn) inEUR

PGAs respectiveallocated regionsto PGAs Asset Asset Management –

a success a success story

57/15/15/8/5 2006 3,044 2,924 1,012 60/40 1,290 57.6 -278 -532 -555 107 764 404 457 735 -57 -53 43 36 -1

56/15/15/8/5

2007 3,259 3,133 1,010 63/37 1,356 58.4 -342 -488 -491 765 498 523 865 206 -59 52 10 25 -2

59/12/17/7/4 2008 74/26 2,894 2,874 68.0 -249 -278 -293 951 703 379 384 633 926 -86 29 83 -5 0 5 59/14/16/8/3 2009 1,202 68/32 1,401 3,689 3,590 62.0 -359 -403 -499 109 926 538 543 902 421 37 84 -7 5 62/11/15/10/2 2010 1,518 66/34 1,164 1,605 2,060 4,986 4,927 58.7 -659 -440 -455 121 113 946 946 514 -11 55 46 94 54 82 0 62/11/15/10/2 1Q11 1,492 66/34 1,138 1,273 1,256 58.5 -120 306 309 429 528 -54 -51 -95 -99 11 15 12 14 56 -1 2 3 Δ1Q11/10 (%) +1/-2/-1/+1/0 -1/+1 105 116 -86 -54 -62 0.3 -52 -52 -56 14 11 66 13 14 14 3 - - +3/-2/-1/+2/-1 Δ FY10/09 (%) -2/+2 -100 A 34 -3.3 -25 26 35 26 76 74 84 78 47 35 22 37 -9 9 - -

© Allianz SE 2011 ( AGI figures Key A. Allianz *) - Split US/DE/EU ex DE/AP (% / Δ%-p)* / (% DE/AP ex US/DE/EU Split - effects f/x - Conso-effects effects Market - flowsNet- (e.o.p.) AuM Total Δ%-p) / (% clients institutional/retail Split - Δ%-p)* / (% DE/AP ex US/DE/EU Split - effects f/x - Conso-effects effects Market - flowsNet- (e.o.p.) AuM party 3rd Δ%-p) / ratio(% income Cost shareholdersattributable- to non-controllingattributable- to interests income Net Incometaxes Incomebefore tax thereof- related expenses acquisition Non-operatingitems Operatingprofit Operatingrevenues thereof- performance feees income fee Net and commission figuresAGI Key P&Lmn / inEURAuMbn) inEUR

PGAs respectiveallocated regionsto PGAs Asset Asset Management –

a success a success story

45/28/20/8 60/16/15/9 2006 62/38 1,276 2,989 2,874 57.3 -276 -532 -556 971 723 395 444 720 107 -58 -57 47 44 40 37 49 -4 -4

44/28/20/8 59/16/16/9 2007 65/35 1,322 3,178 3,060 58.4 -337 -491 -493 970 725 470 492 829 201 -60 -59 57 11 52 11 22 -8 -2

45/27/21/6 62/13/18/8 2008 75/25 2,820 2,813 67.9 -246 -278 -287 920 673 369 371 617 904 -78 -81 28 29 83 -1 -1 0 0 2 47/26/20/7 61/14/17/8 2009 1,178 68/32 1,362 3,599 3,515 62.2 -354 -403 -499 129 110 902 510 510 863 419 -16 -16 53 91 52 83 0 63/11/15/10 51/21/19/9 2010 1,499 67/33 1,145 1,556 2,013 4,879 4,832 58.7 -638 -440 -456 121 113 918 918 512 55 53 93 54 81 -4 0 63/11/15/10 51/21/19/8 1Q11 1,474 67/33 1,120 1,250 1,235 58.5 -118 -100 299 300 419 518 -54 -51 -95 12 14 12 14 56 3 0 1 Δ1Q11/10 (%) +1/-2/-1/+1 +3/-4/0/+1 -1/+1 106 107 -64 -66 -53 -63 0.2 -51 -52 -56 14 11 18 71 15 15 15 0 - - - - Δ FY10/09 (%) +5/-5/-1/+2 +2/-3/-1/+2 -2/+2 A 35 -3.4 -28 -26 32 27 36 27 80 80 80 80 48 36 22 37 -1 -9 9 - - - -

© Allianz SE 2011 ( lines AGI business figures Key Equities Fixed income A. Allianz ***) - Split US/DE/EU ex DE/AP (% / Δ%-p)*** / (% DE/AP ex US/DE/EU Split - effects f/x - Conso-effects effects Market - flowsNet- (e.o.p.) AuM Total Δ%-p) / (% clients institutional/retail Split - Δ%-p)*** / (% DE/AP ex US/DE/EU Split - Share- of outperforming AuM** effects f/x - Conso-effects effects Market - flowsNet- (e.o.p.) AuM party 3rd Δ%-p) / ratio(% income Cost Operatingprofit businessequities* / AGI line Δ%-p)*** / (% DE/AP ex US/DE/EU Split - effects f/x - Conso-effects effects Market - flowsNet- (e.o.p.) AuM Total Δ%-p) / (% clients institutional/retail Split - Δ%-p)*** / (% DE/AP ex US/DE/EU Split - Share- of outperforming Δ%-p) / (% AuM** effects f/x - Conso-effects effects Market - flowsNet- (e.o.p.) AuM party 3rd Δ%-p) / ratio(% income Cost Operatingprofit income* businessfixed / AGI line **) P&Lmn / inEURAuMbn) inEUR *)

PGAs respectiveallocated regionsto PGAs 3 Divisional view lines business financials, for view of AuM for - year 3rd party account partyyear3rd

Asset Asset Management

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a success a success story

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31/39/22/8 38/32/21/8 48/25/19/7 65/11/15/9 - related data related 2007 2007

50/50 69/31 72.0 50.3 203 165 147 767 559 838 -10 -51 -50 15 79 13 42 14 87 39 12 -6 -3 -9 -2 -2 0 0

33/37/23/7 39/33/20/7 47/26/21/6 66/9/17/8 2008 2008 53/47 79/21

84.0 52.8 118 801 574 798 -67 -18 -56 -11 -11 -25 62 98 64 26 18 48 27 10 -1 -2 2 2 1 2 30/45/17/8 33/43/16/8 49/23/20/7 66/9/17/8 2009 2009 56/44 1,026 70/30 1,186 96.2 49.9 152 136 106 766 -14 -15 -15 18 31 63 18 28 14 35 98 83 34 82 91 -1 -1 -8 34/43/13/10 31/45/15/9 54/18/19/8 68/6/16/10 2010 2010 56/44 1,323 68/32 1,735 74.1 48.7 176 156 126 121 114 989 20 63 17 50 54 72 90 49 64 -1 -1 -1 -3 5 0 5 36/42/12/10 30/46/16/8 54/19/19/8 68/7/16/10 1Q11 1Q11 56/44 1,303 68/32 73.5 49.7 171 151 969 461 -50 -47 68 34 18 92 17 -4 -4 -4 -1 -3 0 3 3 3 8 0 9 Δ1Q11/10 (%) Δ1Q11/10 (%) +2/-6/+2/+2 +2/-2/-2/+2 +3/-3/0/+1 0/-1/0/+1 -1/+1 -2/+2 -3.6 -42 -46 -69 -54 -55 -53 1.7 30 15 13 22 4 7 3 4 ------Δ Δ FY10/09 (%) FY10/09 (%) +5/-5/-1/+2 +2/-2/-1/+2 +1/0/-3/+2 +1/0/-3/+2 -2/+2 -2/+2 -22.2 -1.1 810 -36 -98 -38 -90 -26 -22 15 15 53 14 29 25 29 46 0 7 ------A 36

Andreas Utermann Member of the Board of AGI and Day Global Chief Investment Officer RCM

New York, July 21, 2011 the globe the AGI’s B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse 4) 3) 2) 1) focus focus on the U.S. management withfirm a Multi (Dallas, New York, San Diego AGICapital Additional distribution Londonin office Additional distribution Sydneyin office Additional ExcludingPIMCO “AGI”companies Allianz “Allianzof Investorsrefers to or Investors”Globalthegroup / Global and

- strategy investment strategy investment 1

investment management platforms around around platforms management investment

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(Frankfurt, London, (Frankfurt, San Francisco, Hong Kong, Tokyo RCMglobal investment platform production production platform Scalable European Milan,(Paris, Zurich) AGIInvestments Europe

RCM

3 )

Primarily local production Shanghai, Singapore) (Seoul, Taipei, AGI AsiaPacific

B 2 B

© Allianz SE 2011 … with a sizeable presence in all major markets all major in presence sizeable a … with B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse 1Q 20111Q Regional split, 2) 1)

Excluding German fixed income Excludingassets fixedGermanincome RCM,AGI Asia Pacific AGI Capital,AGI Investments Europe,

19% Total: USD398bn

13% AuM

68%

27% 21% professionals Total: 624 FTE Investment

52%

Asia Asia Pacific U.S. Europe

B 3 B

© Allianz SE 2011 client demands demands client meeting capabilities investment broad with AGI platform Investment B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse 1) Capital AGI RCM and certain of its affiliates that is paid for by commissions generated by orders executed on behalf of RCM’s of behalf byforon commissions orders its is paid clients of certainthat by executedaffiliates and generated reportersfield forceinvestigatorsand workwho contractorsindependent as for broker Grassroots

research is Grassroots is divisiongenerateresearch to RCM.a of usedResearch data ...... Key characteristics and strengths and characteristics Key USD53bn assets under management 92 investment professionals NFJ as a strong value platform Rooted in equity markets disciplined risk management Pursuit of sustainable alpha coupledwith infrastructure teams supported byleading Entrepreneurial, autonomous investment Multi USD133bn assets under management globally Over 270 investment professionals Strong equity and multi (RCM cornerstone of the investment process Generating information advantage as a research Emphasis on innovativeproprietary Strong fundamental orientation Global asset manager - strategy strategy investment management firm Informed

–

Grassroots )

SM SM 1

- asset asset capabilities

research -

edge edge

equity regional Country / / capabilities Strategies equity Strategies Strategies spanning widea - U.S. U.S. dealers. Thosedealers.broker Investment solutions spanning a wide market cap market a wide spanning solutions Investment SM

research recommendations recommendations researchis receivedfrom

market market cap and style

non Global Global / equity spectrum spectrum equity non Global / - U.S. - - U.S. dealerssupplyrese

Systematic Systematic

and style spectrum styleand

equity

equity markets Emerging

arch to RCMto arch

Portable Portable alpha Market neutral Covered call return Absolute Alternatives

strategies and sector Themes

total total return Multi asset growth Income and High yield Convertibles and growth Income

B 4 B

© Allianz SE 2011 well recognized in the market in the recognized well performance and capabilities AGI’s B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse Corporate awards 2010 / 20112010 / awards Corporate (highlights) ...... and and Italy Europe 2010”, “Best Asset Manager” in Germany “Excellence in Institutional Asset Management in International Fund and Product Awards “Best International Group” Fund Morningstar Fund House Awards in Europe: and Austria “Best Asset Manager Thomson Reuters Extel Surveys “ Capital magazine (Germany) “Best Asset Manager” and “5 Global Investor RCM European Pensions RCM - - - Best Best Asset Manager“ in Germany 2010 “Best “Best Large House” FI Fund in the U.K. “Best Multi Fund Asset House” in Switzerland “Best Large House” FI Fund and institutional clients France in “Favourite Asset Manager” for – –

“European Equity Manager the of Year” “Equities Manager of the Year 2011” –

Financial News Awards –

Feri Awards

Bonds” Bonds” in Germany

star rating” star

–

– –

–

...... Product awards 2010 / 20112010 / awards Product (highlights)

11 4/5 Fund” 1st place Equity”in “Allianz for “U.S. RCMEquity U.S. Investments Europe AGI “Allianzfund Euro High Yield”, Grand prixde l’Agefi: place 1st “HYin Bonds” for SRI Transparency Code “Allianz Euroland awarded Equity SRI” European for “Allianz EUROSIF: RCM Global Sustainability” and and “Allianz Euro High Yield R” 1st places “Allianzfor RCM Euroland EquityGrowth” Morningstar Fund Awards: 6 fund awards in Europe 8 countries in Europe and Asia Lipper Fund Awards: 38 fund awards in Germany, 13 fund awards in Austria FONDSprofessionell: 16 fund awards in Euro Finanzen Awards: 41 fund awards -

star star Morningstar rated funds in the U.S.

B 5 B

© Allianz SE 2011 Future areas of focus for AGI Capital and RCM and Capital AGI for of focus areas Future B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse management portfolio product Coordinated

strategies Focus on high performing ...... AGI Capital Structured alpha Small cap growth International value International small cap growth High yield Emerging growth / micro cap Dividend value Convertibles

major growth areas Strengthen capabilities in . . . . . (on ad hoc basis) Fixedincome (e.g., long Global alternatives Global multi asset Sustainability Global emerging market

- short strategies)

B 6 B

RCM Global Technology RCM China AGI CapitalHighU.S. Yield AGI Capitalvaluestrategies

B 7 B

Key characteristics Key B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse . . . . . Investment objectives Investment of of the biggest U.S. corporations DividendinvestsValue into valuestocks Outperformance of 1000 RussellValue attractive valuationsand rigorous risk management investment process emphasizing on dividends, Contrarian investment philosophybased a on disciplined (17 years experience on average) Team of experiencedinvestment professionals (i.e. consistent alpha over a full market cycle) Established product witha proven track record - - 1 in efficient in efficient markets Analysisof facts is the best wayto outperform withlowrelative and absolute valuations Diversifiedportfolio of dividend

AGI Capital / NFJ Dividend Value Value Dividend /NFJ Capital AGI

paying companies paying

(in USDmn) Targetcustomer AuM development AuM . . . Retail

Fund of funds DCplatforms dealers Wirehouses and broker /

7,414 2008

–

overview

7,766 2009

CAGR +18% . . . . Institutional Insurance Foundation and endowments Sovereign wealth funds Corporate pensionfunds

9,746

2010

April 2011 10,913

B 8 B

B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse NFJ’s process investment . . . Negative screens . . Primary screen Initial screening . Diversification 1

valuation industry and rank by Categorize by stocks Insider trading Earnings revision Price momentum Valuation ranking Dividend yield disciplined and consistent value investment process investment value consistent and disciplined a with team management equity acontrarian as NFJ

Fundamental research portfolio candidates Risk assessment of Financial analysis . . . . .

metrics Additional fundamental Dividends Earnings Cash flow Balance sheet

Portfolio Portfolio construction . . . . . Sell discipline . . . . Buy discipline Ongoing universe screening price price momentum Extremely poor Quality deterioration Takeout Relative valuation valuationAbsolute Additional metrics industries Diversification across High dividend yield Low valuations

potential Alpha

B 9 B

Lower price to earnings ratio B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse September September through1989 March 2011 NFJDividend ValueCapital / AGI and market benchmark to relative Source: FactSet FactSet Source: Price-to-Earnings I/B/E/S 1 yr Forecast EPS 1 12 18 24 30 0 6

89 90 91 dividend of aportfolio in reflected process Investment

92 93 94 95 96 97 98 - paying companies with low valuations low with companies paying 99 00 NFJ DividendNFJ Value 01

02 03

04 05 06 07

08 09

10 11 11 Russell1000 Value

Dividend Yield Higher dividend yield 0 2 4 6 8 89 90 91

92 93 94 95 S&P500 96 97

02 03 04 05 06 07 08 09 10 B 10 B 11

B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse %, gross of gross%, of March as fees, of 31, 2011 NFJDividend ValueCapital / AGI Source: AllianzGlobalSource:Capital Investors 1)

performance shown above is gross and does not reflect the deduction of investment investment of advisoryfees reflect deductionthe doesnot is gross performanceshown aboveand annualized;beennotyearhas one thanPerformance less of Composite Februaryinception 1989. 1

sets the dividend value strategy apart strategy value dividend sets the philosophy value deep to a Adherence 6.9 1Q 1Q 2011

6.5

18.3 1 1 year

15.2

– -

1.2 composite returns composite 3 3 years

0.6

2.0 5 5 years

1.4 1

Russell1000 Value Index DividendValue NFJ Composite, gross

7.9 10 10 years

4.5

Since Since inception 11.2

9.7

B 11B

...... characteristics Key B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse Investment objectives Investment diversification benefits and total return potential The portfolio isdesignated to improve income, and target upgrade candidates to identify and minimize credit risk, avoiddefaults Strategy is predicated maximizingon information flow Downside protection, upsidecapture wellas diversification benefits compared to other bonds bonds provide higher income and total return potential as The higher coupons and equity performance results, equity High yield:an attractive asset class withimpressive performance credit statistics and highest of visibility operating on issuers exhibitingimproving fundamentals, minimum fundamental bottom Stable and experienced team followinga disciplined, in the U.S. high peeryield group Consistent long 2

AGI Capital U.S. High Yield Yield U.S.High Capital AGI

- term term track record and superior ranking - up investment process withfocus

- like returns at lowerrisks

- like nature of high yield

. . . . Retail Targetcustomer – AuM development AuM (in USDmn)

Fund of funds Asia channelsin Europe and Distribution viaretail DCplatforms dealers Wirehouses and broker / overview

2008 375

2009 457

CAGR +18% . . . . Institutional Insurance Foundation and endowment Sovereign wealth fund Corporate pensionfund

2010 546

April 2011 556

B 12 B

Source: Bloomberg Source: March of Data as 2011 B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse volatility 10 yearannualized returns 10 yearannualized returns 10 yearcumulative 2

equities with less volatility less withequities to comparable has consistently delivered high Thereturns yieldbond market

diversification and favorable risk / reward profiles /reward risk favorable and diversification risk portfolio provides sector yield High

Master Master II Index ML High Yield 124.1% 11.1%

8.4%

S&P500 Index 16.0% 38.3% 3.3%

MSCI World

Index 16.8% 58.8% 4.7%

MSCI AC Pacific

Ex Japan ExJapan Index 284.8% 22.1% 14.4%

B 13 B

B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse %, gross of gross%, of March as fees, of 31, 2011 High Capital U.S. YieldAGI Source: AllianzGlobalSource:Capital Investors 1)

performance shown above is gross and does not reflect the deduction of investment investment of advisoryfees reflect deductionthe doesnot is gross performanceshown aboveand annualized;beennot yearhas Performance less one of Composite Aprilinception than 1994. 2 4.1

1Q 1Q 2011

3.9 consistent outperformance over the last ten years ten last the over outperformance consistent shows Yield strategy U.S.High Capital AGI

3.6

15.7

1 1 year 14.2

13.6 –

composite returns composite 12.8 3 3 years

12.7

10.7

9.8 1

5 5 years

9.0

7.9

Bank LynchBank BB of MerrillAmerica Lynch II Master Bank HY Index of Merrill America AGI CapitalU.S. HighYield 8.8 10 10 years

8.4

7.7

Since Since inception

9.8

- B ConstrainedB 7.9

N/A B 14 B

© Allianz SE 2011 Key characteristics Key B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse Investment objectives Investment ...... over the over the long To rank in the top quartile peer of group 5 of 3 Consistently outperform the benchmark Low turnover Relatively high non Focus on companies in a turn Concentrated portfolio 25 of Bottom up selection stock Focus on H Benchmark: China MSCI 3 –

5% 5% per annum with a tracking error –

10% RCM China RCM

- shares shares and red

- term

- benchmark exposure

- chips – -

around around situation 45 stocks –

overview

(in USD mn) . . . . Retail Targetcustomer AuM development AuM Family office Family office IFA/ wealth management Private banking private/ Fund funds of Germany Commerzbank within Distribution via

2008 163

2009

777

+139%

CAGR . . . . Institutional 1,228

2010

Insurance endowment Foundation and Sovereign wealth fund Corporate pension fund

April 2011

1,248

B 15 B

B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse RCM China China RCM ~ 1000 stock universe Active coverage: 150-200 stocks 3

screening Quantitative reviewscyclical and / secular analysis / Countrymacro sector analysts specialists / Country research Grassroots combined in a disciplined investment process investment adisciplined in combined China RCM

SM –

disciplined process disciplined investment

…

Company analysis growth and quality countryspecialists Sector / analysts management Business Business growth, quality –

RCM’s local and global resources resources global and local RCM’s

Enterprise Enterprise value / countryspecialists free free cash flow, Sector / analysts total total return, EBITDA, Valuation relative ROE P/E P/E

Voting process investment investment team, Grassroots RCM AP office RCM specialists, specialists, manager,

portfolio portfolio country selection Security and HK

construction portfolio 25 Lead PM Portfolio stocks –

client client guidelines reviewand Asia Pacific Portfolio Controls CIO,

B 16 B

B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse %, gross of gross%, of March as fees, of 31, 2011 China RCM Source: RCMSource: 1)

performance shown above is gross and does not reflect the deduction of investment investment of advisoryfees reflect deductionthe doesnot is gross performanceshown aboveand annualized;beennotyearhas Performance less one of thanComposite January inception1998. 3

- 0,1 1Q 1Q 2011

efficient markets of China, adding to superior performance to superior adding of China, markets efficient less in valuable extremely research Grassroots 2.9

–

composite returns composite 15.3 1 1 year

9.4

9.7 3 3 years

4.0

20.7 5 5 years

16.5

MSCI ChinaMSCI China EquityComposite RCM 21.0 10 10 years

16.5

Since Since inception 14.5

9.5

B 17 B

© Allianz SE 2011 Key characteristics Key B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse Investment objectives Investment ...... market market cap, valuation, and global exposure focused portfolios diversifyingby across sub Control risk for and reduce volatility typical in sector models innovative companies outstandingwith business Long Excellent long inception of product Consistent investment philosophy process / since collective experience, together overfor 25 years Excellent managementportfolio team: over 60 years of which market is a weighted benchmark against the S&P North America Technology Index, All cap universe withmid Diversified across regions and industries Global product Target 50 Diverseproduct offering 4

- term term capital appreciation by investing globally in

RCM Global Technology Technology Global RCM –

80 80 companies - term term performance –

up up to 50% outside the U.S.

- cap cap emphasis, benchmarked

industries,

- –

overview . . . . Retail (in USD mn) Targetcustomer AuM development AuM Family office Family office IFA/ management private wealth Private banking / Fund funds of Distributors Distribution via AGI

1,772 2008

3,026 2009

CAGR +42% . . . . Institutional

3,631

2010 Insurance endowment Foundation and Sovereign wealth fund Corporate pension fund

April 2011

4,014

B 18 B

B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse RCM Global Global RCM Technology 4

resources following a consistent investment philosophy investment consistent a following resources local and global team: management Portfolio Investment philosophy . . . . . Utilizing high levels of cash and derivatives to dampen volatility investment of returns Applying control risk through portfolio diversification across many attributes Investing in superior companies with outstanding business models within each growth segment Building an intimate knowledge of portfolio companies Identifying major growth within trends technology Grassroots Global Global policy Derivatives specialist research council Consumer

–

setup Financial services

portfolio portfolio management team Global researchGlobal sector fundamental Health care Global Global Technology U.S. technology analystsU.S. technology

Industrials

Technology

Country specialists Country Telecom / Telecom

media United States technology Europe Asia

B 19 B

B. RCM and B.AGI Capital RCM as successful entities AGI's inuniverse %, gross of gross%, of March as fees, of 31, 2011 Global RCM Technology Source: RCMSource: 1)

performance shown above is gross and does not reflect the deduction of investment investment of advisoryfees reflect deductionthe doesnot is gross performanceshown aboveand annualized;beennotyearhas Performance less one of thanComposite January inception1996. 4

9.2 1Q 1Q 2011

long excellent exhibits Technology Global RCM 4.3

- term performance track record track performance term 39.2 1 1 year

14.7 –

composite returns composite

14.6 3 3 years

8.5

9.8 5 5 years

5.8

Benchmark Global Technology RCM 8.2 10 10 years

2.8

Since Since inception 15.4

7.8

B 20 B

RCM, AGI Capital, AGI Investments Europe, AGI Asia Pacific RCM,AGI Asia Pacific AGI Capital,AGI Investments Europe, Significant contributor to Significant contributor in 2010 (10% AGI’sprofit operating opportunities growth Wellfuture capture to positioned andperformance culture investment Strong demand client focusing meet to capabilities investment Broad markets all major in sizeable presence platforms AGI’s management investment

with a strong and strong a with

)

B 21 B

Giacomo Campora CEO Allianz Bank Italy Day

New York, July 21, 2011 C

5 4 3 2 1

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Management Asset Distribution

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SALES FORCE COMPETITION EXPERTISE of AllianzGroup Lever on the Lever Involvement Analysisof of the

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Performance

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© Allianz SE 2011 Our platform: freedom of choice for clients for of choice freedom platform: Our PIMCO Authority Money Market Formula Formula SRI Formula 100 APPROACH Formula Formula 70 Formula 30 Formula 15 FLEXIBLE FLEXIBLE

Open Open TEAM Open Open TEAM Open TEAM Open Open TEAM Long Long Short ALL STAR Equity Talent

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SWISS & GLOBALSWISS MORGAN JP PICTET BLACK ROCK SCHRODERS CARMIGNAC STANLEYMORGAN AGI RCM PIMCO

Team Other products “AGI” referscompanies Allianzgroup of Investors“Allianz to GlobalGlobalthe Investors” and/or F MA M J A J S N O D 1

10% 11% 12% 15% 33% 3% 3% 8% 1% 4%

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C 35

New York, July 21, 2011 D

3 2 1

Prioritiesandstrategic outlook AllianzLife’s performance Overview

D 2

© Allianz SE 2011 to Group revenue and profit profit and revenue to Group contributor solid isa Life Allianz Highlights D. Allianz Life Life D. Allianz strong strong fundamentals opportunity, supported by focused on the retirement Product, distribution and marketing business needs policyholder obligations and strong liquidity position to support High by Standard (August Poor’s & 2010) AA (stable outlook) financial rating solid foundation for growth Financial performance provides - quality investment portfolio and -

Strength and commitment

2010 Total operating profit Total revenues

16% 4% Group Life Allianz(AZL) 8% 4%

AZL Total AZL Total

EUR EUR EUR EUR

106.5bn 360mn 8.2bn 8.2bn

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AZL Total AZL Total AZL Total

EUR EUR EUR EUR EUR EUR

158mn 993mn 360mn 57.1bn 2.9bn 8.2bn D 3

© Allianz SE 2011 Strong and experienced executive leadership team leadership executive experienced and Strong As April of As 2011 D. Allianz Life Life D. Allianz Yearswithin industry: 21 withYears 7 Allianz: Chief Executive Officer C. GaryBhojwani

Strength and commitment Yearswithin industry: 23 withYears 3 Allianz: ChiefAdministrative Officer Walther White

Years withinYears industry:16 withYears 14Allianz: ChiefFinancial Officer Giulio Terzariol

Yearswithin industry: 26 withYears 26Allianz: Officer ChiefInvestment AxelZehren

Yearswithin industry: 27 withYears 21Allianz: ChiefActuary McKay Neil

Yearswithin industry: 35 withYears 1 Allianz: ChiefHuman Officer Resource Suzanne Zeller

Yearswithin industry: 32 withYears 5 Allianz: ChiefDistribution Officer Tom Burns

Yearswithin industry: 30 withYears 4 Allianz: CounselDeputyGeneral Maureen Philips,

Yearswithin industry: 28 withYears 3 Allianz: ChiefMarketing Officer JonesNancy

D 4

© Allianz SE 2011 Rich history with evolving focus from control to create to control from focus evolving with history Rich D. Allianz Life Life D. Allianz founded Casualtywas North American 1896 . . Reputation 2007 Settled lawsuits Improved media rating

Strength and commitment

Casualty(NALAC) to form and North Life American Life North America withAssociation North CasualtyAmerican merged

1912

Control … Control

. Suitability 2008

suitabilityprocess industryfor leading regulators and Recognizedby

Allianz AG Allianz acquiredNALAC by

1979 . . Product pricing & 2009

newinVA 3Q09 riders in 2Q09; launch of VAsuspension rider overhaul Pricingand product

History America Life) (AllianzAmerica Insurance of Company North Companyrenamed Life Allianz

1993

Product Product distribution & . . 2010 relationships Expand broker/dealer registered channels product throughsales Establish foundation of fixed

company Life to USAform today’s Life Allianzmerged with

… and create … 1999

. . Segmentation 2011 Preferred” Preferred” program Launch “Allianz channels allproducts in all distributionmodel: Implement new

joined AZL GaryBhojwani

2007

D 5

© Allianz SE 2011 Allianz Life is a key retirement partner ... partner retirement key isa Life Allianz Company profile Company D. Allianz Life Life D. Allianz 5) 4) 3) 2) 1) 2010 Long annuitiesVariable Fixedannuities annuitiesFixedindexed IFRS 31.12.2010reserves of onBased as - Total customers Total employees Total assets GPW products: annuities and life insurance Manufacturer and distributor of retirement term care term

Strength and commitment

USD 98.5bn USD10.8bn ~995,000 2,061

97% retirement products retirement 97% VA LTC Life 1% Others <1% FA 4 3

5 31% 9%

FIA 2

57% D 6

© Allianz SE 2011 … and leading annuity carrier in the U.S. market U.S.market the in carrier annuity leading … and D. Allianz Life Life D. Allianz Source: VA market: VA market: Source: Morningstar/MARC;internal analysis & reportindex market: FIA advantage 1) Rank

TIAA

10 11

5 3 9 8 7 6 2 1

1 … 1

- CREF not included as only sells VAs through captive sales force and targeted consumer consumer CREFmarket targeted onlycaptiveand sales as force sells throughincludednotVAs

TotalVA sales Allianz Aegon/Transamerica Ameriprise AXA Nationwide Sun America/VALIC Lincoln Jackson MetLife Prudential Carrier -

Strength and commitment

VA sales USD bn

1Q 1Q 11 39.16 39.16 1.79 1.79 1.84 2.35 4.55 5.86 6.82 0.96 0.96 1.20 1.60 1.68 #7 #7 ranking in individualU.S. annuity market

Market Market share 15% 17% 11% 2% 3% 4% 4% 5% 5% 6%

43%

Rank

10 9 8 7 6 5 4 3 2 1

TotalFIA sales National Western Great American Jackson National Midland Lincoln ING North American Aviva American Equity Allianz Carrier

FIA sales USD bn 1Q 1Q 11 7.14 0.22 0.31 0.33 0.34 0.38 0.38 0.40 0.84 1.17 1.51

Market Market share 12% 16% 21% 3% 4% 5% 5% 5% 5% 6%

49% D 7

3 2 1

Prioritiesandstrategic outlook AllianzLife’s performance Overview

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© Allianz SE 2011 D. Allianz Life Life D. Allianz 1) . … key financials of development Sustainable . . . Operating profit introduced only2002profit in introducedOperating development and hedging skills Access to first class product shareholder with strong growth Attractive financial returns to volatile market conditions Focus on sustainability under Added value for Life insurance -

Strength and commitment

2001 AuM (USDbn) Operating profit (USDmn) Gross premium written (USDbn) 4.7 n/a 15 1

2002 9.1 -45 23

2003 247 9.7 31

2004 14.0 474 42

2005 13.9 421 53

+10% +21% 2006 10.9 532 62

2007 527 9.5 68

2008 - 8.8 117 62

2009 593 9.0 77 CAGR 2001

2010 10.8 472 87

- 2010 D 9

- -

Strength and commitment Allianz Life AA (stable outlook)

affirmed affirmed August 2010

A.M. Best rating Best A.M. F E D C C C+ C++ B B B+ B++ A A A+ A++

- - -

Allianz Life affirmed affirmed February A (stable outlook) 2011

ratio RBC capital available Statutory USD bn

297% 2006 2.7

277% 2007 2.6

206% 2008 2.1

276% 2009 4.1

294% 2010 4.8

D 10

Strength and commitment

AZL

Separate account (AuM in USDbn) 2010 AZL VA portfolio 20.4

Rest Morgan Stanley Invesco PIMCO BlackRock Franklin Templeton

27% 17% 24% 21% D 11 5% 6%

Allianz Investment AllianzInvestment Management -

Strength and commitment AZL

management Brand development Product platform Global hedge

brand management management brand U.S. for Center know AIM expertise expertise product Annuity Example: Example: AllianzKorea 1

- uses uses how globally how

D 12

3 2 1

Priorities and Priorities and strategicoutlook AllianzLife’s performance Overview

D 13

Strength and commitment

. . . Priorities . Foundational Retirement and distribution leadership Employee development and leadership Operational excellence Reputation and financial excellence

D 14

Strength and commitment

. . . Financial excellence . . . Reputation Grow business profitably and manage expenses rate environment Resilient margins despite difficult interest Capital self Enhance awareness of Allianz to keyconstituencies Address outstanding litigation and regulatory changes Smooth transition into suitability model regime

- funding status

D 15

Strength and commitment

Efficiency of indicators Life Allianz . . . . excellence Operational (2003 (2003 100) = 2003 on producer segmentation Differentiated service based Improving efficiencies Lowering expense base Improved service levels 100 100 Operating profit Operating Assets under management under Assets Headcount

2004 192 105 137

2005 114 173 170

2006 107 203 215

213 2007

104 222 2008 203 -47 93

2009 250 89 240 2010 191 91 D 16 286

© Allianz SE 2011 results improved is showing development and retention on focus Internal 1) D. Allianz Life Life D. Allianz managers, and board members boardmembers representsAllianz’managers, 83%regarding overallandemployeeengagement corevalues. viewsthefrom collect serviceto employees,designed provider Allianzinternalsurveyperformedand byonline independent -

Strength and commitment

Employee engagement survey results survey engagement Employee . . . . leadership and development Employee control control and create, and execution Senior leadership offsite meeting on empowerment, Employee development hours increased Open positions filled internally Voluntary turnover significantly reduced 2007 43% 58% 2008

2009 73%

2010 83%

D 17

Strength and commitment

Ranking in total U.S. individual annuity individual market U.S. total Ranking in 20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 2007

Allianz Life

20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 2010

Allianz Life

1 D 18

© Allianz SE 2011 … to capture the retirement opportunity retirement the capture … to D. Allianz Life Life D. Allianz 2) 1) income products and managed asset portfolios under one roof oneasset portfolios under managed income andproducts distributors thelargestofCEO annuities oneofindependent of inthe AllianzU.S. onas providerguaranteedof AllianzGlobal Investors retirementincome andgrow protect Solutionsto help Retirement “Allianz “Allianz positioned retirement” is uniquelyin -

Strength and commitment

. . . AZL and AGI Retirement branding Wholesaling collaboration Product development (ProV1; stand

Aging U.S. population requires guaranteed 1 /PIMCO joint efforts 2

is is well positioned income products

AZL

- alone living benefit)

D 19

© Allianz SE 2011 Key takeaways Key D. Allianz Life Life D. Allianz Strategy, product, distribution and marketing focus on the retirement opportunity retirement Strategy,on the focus and marketing distribution product, financial crisis through navigation Successful to Solid contributor Group financial metrics Allianz Topmarket annuity in playerthe Aspiration for next 3 yrs (USD): grow(USD): 3 yrsnext 5 for Aspiration AuM Solid capital base; dividend paid in 2010, ongoing payments planned planned ongoing dividend payments in paid 2010, Solid base; capital Normalized statutory free surplus generation of USD 100 USD 100 of generation surplus free statutoryNormalized -

Strength and commitment

10% p.a. and operating profit ~10% p.a. ~10% profit and operating p.a. 10%

200mn p.a. 200mn

D 20

New York, July 21, 2011 We appreciate yourunderstanding. For content please refer to White Paper shown in the appendix. Presentation slides suspended for competitive reasons. Please note: E

7 6 5 4 3 2 1

Keytakeaways AllianzLife’s Opportunity From Historyto the Future Opportunityfor change Retirementincomeguarantees The risks wedon’ttalk about Evolvingretirementexpectations

E 3 E

E 21 E

E 22 Rethinking what’sahead in retirement Tableof contents New attitudes New attitudes Searching guaranteesfor in retirementincome ……………………… Potential land mines dotting the retirementlandscape ……………… The evolution retirement…………………………………………….. of He is a member He is a of member the FinancialServices Roundtable and the YoungPresidents Organization. Retirement Institute, the of Council American Life Insurers, and &AllinaHospitals Clinics. and insurance life products. Bhojwanicurrently on theserves Mr. boards of the Insured tradition,helping achieve Americans theirretirement goals income a withof varietyannuities of whichNorth America, has been keeping 1896.since its promises Today, onit that carries GaryC. Bhojwani –

new opportunities 38 ……………………………………..E

is president and chief executive officer of Allianz Life Insurance Company

E 25 E E 30 E E 34 E

E 23 E

© Allianz SE 2011 on guaranteed income as they prepare for retirement. for prepare they as income on guaranteed newemphasis a with transformation of era an face Americans retirement in ahead what’s Rethinking rapid rapid in howshift Americans viewretirement. of the financial contributed crisis greatly this to would have answered yes. Theand “shock awe” brought to knees their in a of matter weeks, few firms Americans in about 2007 whether large investment truly retirement create security. one If polled ted a deep The market turmoil of and 2008 early 2009 cemen teed income for a life, benefit unique annuities. to how plan they retirement for and generate guaran creates an opportunity help to Americans redefine ging long paradigm is emerging in retirement planning, challen Security, and longer life expectancies means newa of defined benefit plans, the uncertainty Social about A combination of unpredictable markets, the erosion of a work company with virtually has disappeared. with gold a watch and lifetime pension after 35 years of new a The reality. era of retirees being rewarded The world of planning retirement is on the precipice Introduction Rethinking what’sahead in retirement ByC. Gary Bhojwani 2) 1) Allianz Life Insurance Company of North America, America, InsuranceAllianzLifeCompanyNorth of The AllianzReclaiming Future2010. Study, the http://nytimes.com/2010/03/25/business/economy/25social.html. Mary Williams Pay ExceedWalsh, “Social PayoutSee to Security –

the pillars the pillars American of finance - held held beliefs in financial planning. shift This - seated seated of crisis confidence howabout to –

the the new reality

–

could could be

- marketplace. GUARANTEESfind in the financial Manypeople have no whereidea to this this risk newthat nowthey own. Americans have not comprehended yettruly ations to employees. their Unfortunately, most tirement security and longevity from corpor risk workers, thereby shifting the responsibility for re taged savings plans (e.g., 401(k) plans) their for the company. They moved instead to taxadvan and carried too much long determined that a defined benefit plan is too costly last years, it 30 appears that employers have most source of guaranteed lifetime the During income. cline of the defined benefit plan, once a Individuals are also coming to withterms the de the amount paid in by workers. since 1983, Social Security payouts exceeded unsettling milestone in For 2010. the time first system in the States, United reached which an the worrisome state of the government retirement shift. The sense of insecurity also comes from The financial crisis is not the driver this only of

- In This Year,” The New York Times, NewThis Year,” York In The Times, March2010,

- term financial term financial for risk 1

- common common

- - - -

educate educate is irrefutable. due full from the government, the need and act to likely be hit to by lightning than to their receive 15 more When of than half Americans who just are problem that get worsewill if only left unanswered. considered polarizing a political issue. a It’s math leaders and But policymakers. should this not be retirement funding should startle both financial The depth fear about of Social Security and private sector, and taking action. begin forms insured of income retirement offered the in will need learn to as much as they can about new financial marketplace. Options do exist, so boomers have no where idea to guarantees find in the guaranteed into retirement income. people Many ever that must they howlearn convert to assets retirement, are they coming realize to than more As 76 baby million boomers enter are or near - 20 20 from years believe retirement are they more 2

E 24 E

© Allianz SE 2011 1 . . and expectations, including: forcing them readjust to financial their beliefs is experiencing a confluence of factors that are not equal. Today’s generation baby of boomers approaches and beliefs about are retirement As look we back time, see in we that all over another. emphasizing one aspect retirement of the question on psyches, their each withgeneration typically experiences of that generation, imprinted deeply the next. These mindsets are on built the personal retirement evolved have from one generation to how generation a viewsand investing saving for The mindsets and buzzwords that characterize Rethinking what’sahead in retirement solution solution to their retirement problems. once retirement eggs nest Recession The severity of the financial and crisis Great paycheck their withsources other income. of A realization that willthey soon to need replace - steady steady in faith the equity markets as a

The evolution of retirement of evolution The –

and the significant and the significant their hit on –

that undermined that undermined their

have have occurred. the past years, three 70 shifts broad in mindset Looking back attitudes at about during retirement must rely on investment their for assets income. retirement income planning phase when now they in late their and 50s early are reaching 60s nowthe remains, however, vast that a of group people boomers and subsequent generations. The fact something still important for younger baby accumulate wealth in preparation for retirement, Financial professionals helped have their clients financial their beliefs. boomers READJUST to A confluence of factors is forcing .

parents different from that those for worked their next generation retirees to of look solutions for and guaranteed income A series of challenges

–

– e.g., e.g., lack a of savings

that are forcing that are forcing the

. . . informed series byof a momentous events: given that attitudes toward investing were greatly This caution sense of and concern is not surprising, generation were “guarantees” and “safety.” preparing retirement. for The buzzwords this for approach financial to investing, planning, and “greatest generation” generally took cautious a Depression and World II, the War so Shaped by lifetime events such as the Great and “safety” wave The first retirement. provide a base financial level of support in The inception of Social Security in to 1935 Corporation 1935 in to protect savings. bank creation the Federal of Deposit Insurance (where people lost savings) their that led to the The financial collapse and insolvency banks of investment markets. Commission and new laws securities to regulate creation the Securities of and Exchange The 1929 stock market crash the that led to

–

“guarantees”

- called

E 25 E

© Allianz SE 2011 of of population Stockholders as percentage a Rethinking what’sahead in retirement their retirement retirement their security. form of an employer panies that a offered defined benefit (DB) plan in the value a a job for lifetime, and be attracted to com employment of Depression the Great led many to financial planning and career choices. Theun high to wantrock about in markets general led many of generation this These government interventions and the insecurity Source: “The First “TheSource: First Century,”Measuredwww.pbs.org/fmc/book/14business6.htm. - solid solid guarantees and safety in both their

- sponsored sponsored pension to provide

- -

well for well for 30 from personal savings. This worked model fairly another from third plans, employer and one One income known as the “three result of choices their was formula for a retirement at retirement. they Whether knew it not, the or company for 35 and years the gold received watch This is the generation have that may stayed at a EQUITYmarkets. stayed away from The greatest generation - third third was derived from Social Security, - 40 40 years.

- legged legged stool.”

third

planning products. insurers life provided of the bulk retirement their oriented their decision guaranteed rate of Guarantees return. and safety provided FDIC either insurance savings or on a certificates of deposit, and fixed annuities that savings) often the took form of savings, bank In addition, the leg third of (i.e., the stool personal guarantees and security that they preferred. (in the form of pension plans) to provide the (in the form of Social Security) and employer their instead comfortable was allowing the government in having control of retirement their and assets investing, generation this was less interested By avoiding the stock market and mutual fund the era when baby boomers entered the workforce. that increased to just 13% in bythe 1980, midst of ted only the 4% American of population, a number stock market crash of stockholders 1929, represen from equity markets. In long 1952, after the great members the greatest of generation stay to away (Social Security and defined benefit plans) led tees underlying two Their generally cautious attitude and the guaran

- thirds of their retirement of retirement their thirds income - making, making, and banks and

E 26 E

© Allianz SE 2011 Percentage Percentage householdsU.S. of owning mutual funds Rethinking what’sahead in retirement boomers boomers on focused maximizing rate their of return For the part better of the 1980s, 1990s, and 2000s, “control.” words for generation this were “rate of return” and Instead of seeking guarantees and safety, the buzz werefearless mostly and emboldened as investors. most their of working early years, baby boomers times and energized by solid economic growth for parents. Growing up in primarily favorable economic assets a decidedly in different from waytheir boomers approached the management of their Like many things touched they society, the in baby “rate return” and of “control” The second wave Source: Investment Company Institute, “Ownership of mutual funds, shareholder sentiment and use of the Internet, December 200Internet, the of use and sentiment “Ownership shareholderCompany Investment Institute, funds, Source:mutual of 1) Use of the Internet, 2010,” Research Fundamentals, Investment Company Institute, September 2010, Vol.19, No.6. Vol.19, 2010, September Company Investment Institute, Research 2010,”Fundamentals, Internet, Use the of DanielandSentiment, Schrass, and Funds, Mutual“Ownership of ShareholderJohnSabelhaus, MichaelBogdan,

–

pension pension assets. better than the government or managing those that they could create long became prevalent. boomers Manyfelt empowered With the cost of down,commissions day trading amazing speed and low cost. and execute personal financial transactions at to waystrack investments virtually instantaneously this control. sense of Technology provided new cant advances in information technology enabled say more their in howmoney was invested. Signifi in order to accumulate Theywealth. more wanted OFRATERETURN. on maximizing their Boomers focused

- term financial term financial security

$11.5 $11.5 trillion. Mutual fund ownership in the country now tops number remains 43% even at at 2009. the end of 48% in 2001. Though downthat from point, the funds dramatically rose from in 1980 5% nearly to in the below, chart household ownership mutual of the investment choice of for boomers. baby seen As staff DC about plan mutual options, funds became With the help employers of educated whotheir individual. owntheir personal retirement, giving control to the uals invest to in nearly of any type investment for Outside of plans, these empowered IRAs individ contributed to the plan. racting talent via a match an of employee what balance their sheet to the employee, while still att tirement plan’s longevity risk and responsibility from place. DC plans allowed employers to shift the re 1981), began assume to prominence in the market (modified and made relevant beginning more in 401(k) and plan started by law in and 1981) IRAs ed defined contribution (DC) plans by(typified the ment savings vehicles, such as employer sponsor This also wasthe era self when new 9

- directed directed retire E 27 E

- -

© Allianz SE 2011 Source: LIMRA,Source:“Retirement 71. 2009, ReferenceBook,” Income “EitherNote:assumes lives independent.are The The decline of defined benefit plans plan significantly, eroded in part due to accounting three decades, the DB in part traditional by a pension plan. the nextOver In 38% 1980, employees of covered were at least hold, employers cut back on defined benefit plans. As the trend toward greater personal control took Rethinking what’sahead in retirement DC onlyDC onlyDB Both Neither 2

1 2 2

2) 1) Boston College, November 2008 November College, Boston at Research fit Center for Plans,” Retirement Bene Defined Private and Crisisi Financial “The 2, No. www.ebri.org. Vol. 30, February “Notes,” 2009, - based based guaranteed pension

personal control. achieving rates higher of return and having safety and guarantees a seat took back to on the other hand, were off mostly the radar as withgeneration. this and Bank insurance products, estate investments have become more prevalent and bond investing, mutual fund accounts, and real As practical a matter, this means that shift stock remained constant around at 54 are not covered by either or a DChas DB plan is the that fact the percentage Americans of who Americans today. Perhaps even worrisome more for individuals that is still not widely recognized by ees. This has created gap a in longevity protection income needs shifted from the employer employ to place plan) meet to major a portion retirement of risk building of sufficient savings (through a work rule changes, with only 13% covered in 2006. The

is still not is stillwidely not recognized. A gap in longevity

protection - 56%.

- faster faster than the historical welcome as most sawportfolios their accumulate level of growth.In case, this uncertainty was and 1999, stocks an enjoyed unprecedented 1974. decline, the 43% drop that occurred in 1973 and after the last and dramatic sustained market millennium. Most boomers baby began investing This reality in hit home the decade first the new of risk. income, the one’s value of portfolio, and longevity greater uncertainty about the in future terms of reality down on them, boomers are seeing a harsh new, retirement and with the retirement era of bearing Having taken on personal greater responsibility for experiences of Depression. the Great generation never let beliefs go of from formed their are still feeling effects) its as the just greatest Recession will not fade (especially quickly as many American psyche. Memories of the Great and compelling experiences that have hit the shift in is happening attitudes of because powerful waveof retirement As is emerging. in the the past, In the wake of the financial 2008 collapse, the next and and “guarantees” The nextwave 1) Stock Stock Trader’sAlmanac, 2011.

– After that point, particularly that After particularly point, between 1982

controlling controlling one’s investments can in result –

“lifetime “lifetime income”

E 28 E

© Allianz SE 2011 retirement in rebuild order to savings. lost their to scale back expectations their or delay even stock market. As a result, weremany forced a portion good of nest their egg invested the in moment for those nearing retirement, had who 2007 February 2009). to value, this in time a of span 17 months (October reaching heights, new the market 51% lost its of value. Then, after recovering from that drop and (as measured by the S&P 500) lost its 41% of 2000 From early to 2003, the stock market in Twice a decade, the tables turned dramatically. Rethinking what’sahead in retirement 1)

mindset mindset all of Americans. of a What has occurred is nothing short “The Callan Periodic Table of Investment Returns,” Callan Associates, “TheCallanReturns,” Investment CallanTablePeriodic of 2011. Associates, decisive shift 1

This was a wasThis a seminal

in the in the financial

profit. profit. Thatnotion also has changed. able sell to home their if wished a they for tidy Likewise, most boomers assumed would they be of the S&P 500 been has in territory. negative back to the 2008, 10 than a years. fewYet for twoa that equities would gain in held value if more for a “buy consumers would have questioned the benefits of Prior to the financial it crisis, is doubtful that many - and - hold” hold” strategy. was It taken as gospel

- year average annual year average annual return - year stretch year stretch dating

boomers boomers “lifetime are income” and “guarantees.” In the newshort, buzzwords aging for baby interest, subject but wasto market downturns. against compared losses to one 8% that paid an investment a with4% return and a guarantee given a 80% choice, of baby boomers would select returns, emerged. has According this to if survey, a desire lock in to guarantees, in of lieu higher Among baby the entire boomer surveyed, group 44 to said 49 they unprepared feel retirement. for Study (conducted in 2010), May 54% of aged those According to TheReclaiming Allianz the Future but especially for those or near in retirement. shift in the financial for mindset all Americans, What has occurred is nothing short a of decisive

E 29 E

© Allianz SE 2011 2 Source: LIMRA,Source:“Retirement 71. 2009, ReferenceBook,” Income “EitherNote:assumes lives independent.are for this length for length this of time? prepared to fund their retirement many HowAmericans are Probability Probability of 65 Retirement will longer last Rethinking what’sahead in retirement for as they finalize for as finalize they plans for retirement. Here key are some risks Americans to need prepare fully educated them. about the challenges. Yet, many boomers have not been about finding targeted solutions to help overcome Taken whole, as a add they the sense to of urgency they been have on the some radar for time. retirees are often not talked ones about, though The risks that lie ahead for and new pending

the retirement landscape retirement the dotting mines land Potential - year - olds olds surviving select to ages

Longer Longer expectancies life while women’s while women’s expectancy life reached has 80. Today, males have life a expectancy 75 years, of enough to access the benefit. of 65, the average American long would not live Security was implemented with an eligibility age above 63 for This women. means that when Social expectancy wasover just and 59 men for slightly In before 1939, America entered War World II, life

three decades three decades or longer. chance that one of willthem be in for retirement In other words, that couple faces one a chance that one exists will survive to age 94. at least the twoone of age will reach 89; 25% a married couple age 65, 50% chance a that exists life sure expectancy in the aggregate. So a for ever, the actuarial are probabilities to us help mea even longer than today. do What weknow,how when new medical technologies extendmay life expectancy Life remains unpredictable in an age much longer than just fewa ago. decades It means, also however,that willretirement last expectancy life in the course of human history. for our society, may as fastest it be the increase in These numbers represent remarkable a triumph

- in -

four

E 30 E

© Allianz SE 2011 Insurance and Federal DisabilityFederal andInsurance Trust Funds,”May2009.12, Old Federalthe of Trustees of Boardthe of Report Annual “The Source: 2009 Fewer workers to support Fewer workers support to retirees Rethinking what’sahead in retirement as as knowwe it The sustainability of Social Security created created in the 1930s, the average person was not As previously, noted when Social Security was

the the future. since 1950, and will continue decline to into support each beneficiary declined has dramatically that the ratio workers of paying the into system to beneficiaries as it did in the past. notable Most is Moreover, may the system not be to able support degree. out of Social not Security has risen to comparable a cally since then, the age at benefits which are paid 65. Though expectancies life have grown dramati even expected reach to the retirement full age of

- Age and SurvivorsandAge

from what is projected from whatis projected today. idea that Social Security may pay out differently Americans need factor to planning their into the Regardless of what happens to the system, Social Security. be struck by lightning than get their due full from 44 to year feel 49 olds have they better a chance to the Future both. supported is This by The age, a reduction in or benefits, combination a of than many expected through increases in eligibility government support retirement of be may less system seem inevitable. The result could be that recipients shifting so dramatically, changes to the With the balance between contributors and

Study, which found which Study, that nearly found half of

Allianz Reclaiming Allianz

E 31 E

© Allianz SE 2011 Rising health care costs Source: “Trends in Health Care Costs and Spending,” Kaiser Family “TrendsFamily Source: KaiserHealth Spending,”in MarchCosts Care 2009.andFoundation, 1) Cumulative changes Cumulative changes in health insurance, inflation, and workers’ earnings Health care can have a dramatic effect on retirement Rethinking what’sahead in retirement

“The Callan Periodic Table of Investment Returns,”Callan Associates, “ThePeriodic Returns,”CallanCallan Investment Associates, Table of 2011

smoking. smoking. Recent trends are to likely continue. of inflation rapid in health costs in failed 2010 to address largest the twodrivers far costs, care solutions have be found. yetto Even the Despite the rising awareness escalating of health This is adding notable a factor retirees. cost for become significant more as growthey older. - reaching reaching health care legislation reform enacted

–

obesity obesity and

of of returns affects a portfolio The hidden risk of performance of performance have can a impact. huge taking income from their holdings, the variability invested. But for drawing those downor assets given holding period, assuming the dollars stay and ultimately achieve the average return for any investments. They weather can times the volatile accumulation do whonot draw their down on This issue is not an consumers for on focused investment performance. Averages not account do for the of variability cally from 37.6% in to 1995 8.23%. return of the S&P 500 from to 1990 was2009 investments). For example, the average annual (either the market for as a whole or specific for concepts for investors is the average rate of return One the tantalizing of and easily more understood 1

Yet the range the range Yet of varied dramati returns –

how sequence

- 37.0% 37.0% 2008. in

E 32 E

© Allianz SE 2011 If this were an actual product, the returns may be reduced by certain fees and expensesand fees certain byreducedreturns the may be product, this wereanIf actual specific anyinvestment. performance of theproject to intendedis not and exampleThis is hypotethical a Sequences Sequences of returns matters Rethinking what’sahead in retirement

long assets long willassets last. returns a has impact large howon Theof SEQUENCEa portfolio’s

E 33 E

© Allianz SE 2011 3 guarantees. the bulk these of assets nowright not come do with Unfortunately, unlike the other two legs of the stool, taking a bigger role in keeping the stool upright. while the third Thetwo first legs becoming increasingly are wobbly, equal of mixincome generated bysources: three “three be coming to an end. This of is the the era famed A long . . . Rethinking what’sahead in retirement 3) 2) 1) GUARANTEES. nowright do not come with The bulk personal of assets Individual Individual savings and investments Employers (through defined benefit plans) Government Social (via Security) www.businessweek.com/ap/financialnews/D9EKB5800.htm,October2010. Delli“NJ Angela Santi, governor signs worker reform pension measures,” Businessweek,MarchBloomberg 2010, May Lichfield CherylRoussel, and2010.John“Sarkozy raisingin follows The retirement Independent,Europe age,” MayFunds,”U.S. Government Office, Printing 2009. Old Federalthe of Trustees of Boardthe of Report Annual “The 2009 - - legged legged stool” referred earlier, the to generally standing standing era in retirement may planning

Searching for guarantees in retirement income income in retirement guarantees for Searching –

personal personal assets

–

is by necessity is by necessity

early retirement early and retirement pensions until frozen 2012. women from 60 65, withto financial penalties on 60 to 62; Greece is the moving retirement age for by 2029. France is struggling move that to age from increase its retirement age overtime from 65 67 to hold across many of parts Germany Europe. will and increases the retirement in age are taking cutbacks to retirement Pension programs. reform level within the States United government is for In the fact, trend and even worldwide at the state levels will occur. assumed that some reduction from current benefit payments of workers fund to beneficiaries, and it is After that, the system will entirely rely the direct on trust its fund (another word “surplus”) 2037. for in the Social Security system is estimated to exhaust Social Security does not appear Without likely. a fix, Given strong anti Social Security - Age and SurvivorsDisabilityFederal Insuranceand andAgeInsurance

- tax sentiment, tax sentiment, quick fixa of

from enrolling from enrolling in the state pension system. pension and benefits part barring passed has laws rolling back 9% a increase in $46 billion in unfunded liabilities, Jersey New pension to benefits public employees. With about setting a precedent by rolling back increases in Domestically, the state of Jersey may New be from 65 to Americans 67 all for born after 1960. United last States raised age retirement its 1983 in to increase age retirement its to 67. from 65 The The International Fund Monetary Spain urged has

Trust Trust

- time time workers 3

E 34 E

© Allianz SE 2011 stewards of the company’s stewards of the company’s pressure money. This is must to prove shareholders that are they good CEOs cannot print money to pay bills, but instead employers are looking for reduce to costs. ways on corporate balance sheets. government, Like require the funding status of pension plans appear to such plans, especially as accounting nowrules corporations will change course and begin reinstating appears to have ended, likelihood with little that The era of big corporate defined benefit plans also Employer Employer plans Rethinking what’sahead in retirement 1) 1/1/2008 to to 1/1/2008 3/2/2009 among 401 participants (k) Change in average 401 (k) account balances from Center for Retirement Retirement forCenterCollege, Boston 2009.March at Research Trillions March Dollars,”2009, of United 9, States, of theFundsAccounts Flow of to Alicia Muldoon,“EquityDanMunnell DeclinesH. and2007 October 9, from

guaranteed guaranteed retirees a first downturn linked to the Great Recession pre gave ity for owntheir retirement The market security. Individuals now to have accept greater responsibil Individual investments income for benefits employees at most firms. unlikely to boost interest in guaranteed retirement

- hand hand “feel” the pitfalls for of non a 2) Data Collection Project 2008 and 2009 Account Account Balances. 2009and Data CollectionProject 2008 EBRI/ICI from tabulationsParticipant on EBRI estimates based as 12/31/2007. of balances account onBased

- -

- not guaranteed. not guaranteed. secure about retirement of income if most it is a reality: striking is nearly It impossible to feel Americans have begun come to withgrips in retirement their trajectory. negatively affected and at precisely the worsttime most in of need stable nest a egg were the most the end of to 2007 January Thus, 2009). the ones losses 25% of 30% in their to plans 401(k) (from Consumers aged 55 to 64 generally experienced people tend have to accumulated the most money. to retirement The losses most weresignificant those for closest saw it much evaporate of almost overnight. spent as many as 40 accumulating years wealth retirement goals failed protect them. to Manywho strategies intended to people help achieve their $12 trillion. 57%. In dollar terms, these lost portfolios than more nefit, and household nonpension declined assets by equity holdings in defined contribution, defined be severe bear market of 2008 the From market peak point to lowits during the think how position they assets their retirement. for retirement as well powerful as a motivation to re - Directed Retirement Plan 1

Investment Investment vehicles and diversification –

a logical logical a outcome given that these

–

2009, 2009, the value of

E 35 E

© Allianz SE 2011 live. the reality is that no one knows how they long will time, these options may suitable. be But, of course, looking an income for solution a for set period of for, say, years. For 20 those 65 projecting the income stream that will be needed These tactics take often arbitrary approach an of withdrawal plans or using tactics target date funds. but that do not provide guarantees Among the alternatives being currently considered solutions. are increasingly interested in insured retirement sustainable regardless of how live, they they long secure new sources reliable of income that will be As boomers enter and retirement try to personally ding source of a income that guaranteed is for life. Only recently a has focus newbeen placed on fin to products that provide guarantees. looked the concept of a devoting portion of assets person’s age. Thatallocation often process over gy of adjusting an asset allocation mix the based on Many in have the industry followed typically strate a ted earlier, is lifetime income and guarantees. enter the nextstage life? of The answer, as sugges What are boomers for looking as prepare they to The The rise of the insured retirement solution Rethinking what’sahead in retirement 1) A Profile of Older Americans: 2009, Administration Human U.S. andDepartmentServices. Profile HealthOlder Administration A of of onAmericans: Aging, 2009,

- year –

are systematic are systematic olds olds who are

– - -

of guaranteeing of guaranteeing a stream of income for life. guarantee rate of a they return, cannot offer ways Though banks offer FDIC when connected to investment their offerings. red by regulators avoid using to the word “guarantee” the other hand, cannot do this fact and in are requi tees. Mutualcompanies fund brokerage or firms, on one’s assets. Insurers offer lifetime income guaran by eliminate the biggest of risk retirement Only insurers that offer annuities pool can and there America in 2008). 100 (there more werethan 92,000 centenarians in throughout retirement, if even live they beyond age to guarantee a stream of income that last can and are thus to able people give the opportunity position to overall longevity pool and financial risk In the case retirement, of insurers are in a unique financially. of dying too soon, while protecting one’s family having one’s property damaged or stolen the risk or and it be can risks of all types, such as of the risk an insurance company undertakes to is “pool” risk plan using owntheir A fundamental assets. activity create owntheir of form defined benefit a pension solution based on annuities that allow people to What is being missed is the insured retirement

- insured insured pro - ducts ducts that –

outliving outliving

- - – -

of life. of life. exhaustion personal of savings before the end is the same. In case, this the risk is the possible The concept pooling of to risk protect retirement $2,500 if one of 20 autos those should be lost. drivers pool risk, their is on each the hook just for 10 people reduces the to exposure $5,000. If 20 $25,000 if one car is lost. Spreading the risk among If people twotake on each the risk, is pay willing to liable for the entire $50,000 of any potential loss. wants to take the exposure on alone, he she or is If owner of an a $50,000 car buys insurance no and ownpay cars insurance for to protect against loss. risk the world in of auto insurance. Americans who respect to retirement see is to insurers howpool The easiest way understand to this withconcept outliving one’s assets the biggest risk of retirement can pool and thereby eliminate Only insurers that offer

annuities –

E 36 E

© Allianz SE 2011 Designed Designed to 20 last years Social Security provides. consumer must exclusivelyrely almost on what when the assets fully depleted. are this At point, the chart is the unfunded area of retirement that occurs reaches years of 85 age. The bright zone blue in this that there’s an income gap that whenexists a person for 20 of income years the chart in webelow, see If look weexisting at models accessing of a portfolio Rethinking what’sahead in retirement 2) 1) LIMRA,“Retirement 71. 2009, ReferenceBook,” Income receivingafter whofewpayments. a byonlydie lifetime annuitants values account forfeitedlifetime thanincome This guaranteed only.largerchargesSurrendermay purposesplay note:is demonstration forrole afundingPlease in

benefit. insurer’s general account provide for longer a For those live who longer, the pooled in assets the annuity contract value will their go to beneficiaries. before received they’ve 20 years income, of their 85. a With guaranteed benefit, for those die who insurer is able cover the to gap of living beyond age longevity risk for the consumer, that see the we If then look we at pooling risk take to awaythat

The insurer’s The advantage insurer’s

auto insurance auto insurance for car owner.does a offer a level similar of protection retirement for that own devices resolve to challenge. this Annuities Morethan Americans ever, have left been to their sumers today than of the risk outliving one’s assets. There may be no financial greater threat facing con pay for the people who live longer. They the risk pool a of group large people of to help This insurers is howguarantee can income for life. –

pooling pooling risk of

E 37 E -

© Allianz SE 2011 4 Source: TheAllianzSource: money in retirement” money in retirement” was bigger a fear. feared the reaper, grim “outliving 61% said my but the risk outliving of their While assets. 39% that their greatest fear in is retirement not death, Reclaiming the Future Study, boomers indicated of of the risk outliving one’s assets. The Allianz In Baby boomers are increasingly becoming aware Rethinking what’sahead in retirement annuity annuity to has offer wantin is, what fact, an that PRODUCTconsumers The IDEAL FINANCIAL Which Which do you fear most?

New attitudes attitudes New Reclaimingthe Future

Study, 2010.Study,

–

new opportunities financial financial professionals conducted for the Life adjustments. According to 2009 a survey of 1,200 professionals recognize nowthe need make to about to howmaintain income for Financial life. Boomers are not alone in desire this to know more jumps to 82%. dents, the fear of outliving more assets than death aged to 49 44 who married and with are depen and wealth accumulation ahead of For them. those of the boomers who still have may 20 of workyears concern more is even pronounced the youngest for savings. their Theshows study also that the portfolio whenshock just they to need tapping start are near retirement and be may dealing severe with This fear is not gripping only boomers older who

Annuities Annuities another by name participate participate in market upside.” of the 15 characteristics “the opportunity was to annuities. Also noteworthythat is the lowest if they do not realize that these are the attributes of wantin is, what fact, an annuity has offer to In the ideal short, financial product that consumers 5. 4. 3. 2. 1. rate, the top five important most were: products that survey respondents asked were to that of the 15 different attributes financial of The Allianz 10 to years ago. 20 public based on attitudes formed the about products to ues have negative a perception in the general problem, however, is “annuity” that the wordcontin solutions, annuities with a playing central Therole. stating a desire for retirement guaranteed income fessionals, and government are regulators publicly planning for retirement. Individuals, financial pro Change under is clearly the wayworld in of financial

and and predictable Don’t need think to about it, stable, Protection against market downside Guaranteed not to lose value Guaranteed income stream life for Stable, predictable retirement standard of living Reclaiming Reclaiming Future the

Study found found Study

- – rated

even E 38 E

© Allianz SE 2011 consumer: that an informed an owner annuity is a of happy annuities, a surprising from the fact Allianz study is For those have who knee a Happiness is an annuity owner acked annuities, without often understanding them. commentators in the media who reflexively have att views. These negative may reinforced viewsbe by to learn more about annuities since forming their In addition, 64% admit have they researched never perception their annuities of more than 20 years ago. years more ago. in they One four said determined annuities is based on information from 10 to 20 or Most consumers admit that biased their viewagainst out of balloon. a the word itself could be comparable to letting the air ted to about learn and benefit from annuities, uttering looking whenfor. Just consumers be interes might features and of benefits annuities as what werethey “annuities,” even though they described the exact consumers expressed distaste the wordfor ming the Future annuities continue to dominate. The Allianz The problem, however, is that misperceptions about Rethinking what’sahead in retirement in coming in coming years. long incometeed planninglifetime and The demand and need guaran for -

term term security will only grow

Study also also Study that showed 54% of

- jerk jerk reaction against

Reclai

- systems. systems. The model of retirement that may they dramatic pressures new building up on retirement ded that taking action no an option, is not given the this product Consumers set. need also to remin be consumers understand easily more the benefits of ance” are two just that are increasingly to used help sumers. “Longevity insurance” and “retirement insur that better reflect what the product provide can con waysNewdescribing of an annuity are emerging may made be about guaranteeing lifetime income. process continue to so that a fully informed decision to change, if only allow to education the consumer wordpreempts “annuity” the conversation. This has financial professional’s visceral reaction against the ment discussions planning never because start the than discussing itself. the All name too often, retire with the basic benefits the product provides rather Conversations about annuities have often to start . . . was recommended. ever Another 19% are not certain whether an annuity ional not has presented an annuity as an option. Yet 46% of respondents say financial their profess in satisfaction among all financial products. they tion benefit This from. ranks second chase because of the safety, security, and protec 80% of annuity owners are their happy withpur

- highest highest

------only grow in coming only in coming grow years. time income planning and long certain acknowledge structural this change, one is thing ment officials, business or leaders want accept to or sumers, educators, politicians, the media, govern and world have also Whether changed. or not con retirement increasingly in an economy uncertain fundamental perceptions of howto best prepare for The world of planning retirement changed. has The ate step consumers need take. to annuity plays overall in an portfolio is the appropri Achieving a healthy understanding of the role an duct to tried or portray it as wassomething not. it ties created wereby those who oversold the pro today. Many of the impressions negative of annui ate for every financial challenge consumer a faces are not the only and solution not be may appropri Lastly, is important it to emphasize that annuities long of other sources guaranteed of income, a is which been reduced, consumers to made need be aware guarantees from the government employers have or ago may not be appropriate the future. in Since have adopted and fully believed in a just years few - term term education process. –

the demand the demand and need guaranteed for life

- term term security will

E 39 E -

------

© Allianz SE 2011 Allianz Life FinancialAllianzLife Services, Hills LLC,member FINRA, Golden Drive,5701Minneapolis,MN 55416 North of America. Insurance AllianzLifeCompany issued Products its areproductsareby Variabledistributedbyaffiliate, whichsubaccounts, willvariablemarket withthe performance of the fluctuate to con applynot do guaranteesannuityVariable claims strengthand financial bytheare backed Guarantees 3) 2) 1) About Allianz About In fact, In we fact, never were downgraded during the recent market crash. We’ve earned consistently financial ratings high in real time, have we the to potential hedge against both general market turbulence and financial crises. diversification across asset types; high credit rating requirements; a high level of liquidity; and strong risk modeling. By We have a conservative investment management philosophy income money managers. and Allianz investors, Global a of network companies that includes (Pacific PIMCO Investment Management Company LLC), one of The SE Allianz of family companies in North America, includes Fireman’s Fund®, premier a property and casualty insurance comp manager. We’re part global a of financial powerhouse. predictable income, retirement and protection of assets. universal life insurance. Founded in 1896, Allianz Insurance Life Company North America of provides innovative financial solu We serve millions customers, of America (Allianz) the has strength and stability to always remain true to our promises. Any financial product is only as strong as the company behind it. And leading as a provider of solutions, retirement Allianz Rethinking what’sahead in retirement change. to are subject analysts andbyapprovaltheindicate ratingsnot strategies.The doandobjectives management of evaluation financial an of analysisresults and onan based areratings agency Theseindependent (www.pionline.com). 2010management. assets October 18,total under byRanked “TheP&I/TowersWatson World TheInvestments, World’s Managers,” Money& 500: Pensions Largest onFortune’s revenue. is basedranking 2010.26,July Fortune,Global“Fortune500,” 2

Allianz Allianz nearly SE serves 75 million customers in 70 countries.

with over 2.2 million with 2.2 over million policies issued wealth for management that products include fixed and variable annuities, and

Our parent Our parent company, Allianz is the SE, world’s 20th largest company

from independent from independent rating agencies including Standard & A.M.and Best, Poors, Moody’s. - paying America. InsuranceAllianzLifeCompanyNorth ability of of

designed designed to weather all market conditions and long achieve

- 1297. www.allianzlife.com1297.

dit

ions.

and and the world’s third largest money

mon Lif itoring itoring and controlling risks e Insurance e Insurance Company North of - tio term term based results, on ns ns for wealth accumulation, any the

for more more for than 140 years;

world’s leading world’s leading fixed 3

- E 40 E

New York, July 21, 2011 Key products Key F. ProductF. design and management risk Source: VA market: VA market: Source: Morningstar analysis/ & reportMARC; indexinternalmarket: FIA Advantage 2) 1) Based on 1Q2011 onBased sales annual2010 onBased ...... account Spread Rank #1 AZ Life Market share 21% 10 Market size USD32bn Taxdeferral Death benefit protection Lifetime income guarantees Capped participation in market growth Principal protection - year CAGR20% Fixedannuities indexed -

based 2

USD 6.9bn USD

–

backed backed bygeneral

Benefits / Benefits features Structure Market sales 2010

...... backed bygeneral account byseparate accounts; guarantees Fee Rank #11 (#7 non AZ Life market share 2.5% 10 Market size USD138bn Taxdeferral Death benefit protection Lifetime income guarantees Market participation - based - year CAGR0% Variable annuities USD 3.2bn –

contract contract value backed

- captive)

2 2

F 2 F

12% / 31% / 57% /

- 10bn 49bn 27bn force (IFRS reserves) (IFRS force

Total: USD 85bn

premiums) (statutoryNewbusiness Other VA FIA

30% / 3.2bn 64% / 6.9bn 6% /0.7bn

Total: USD 10.8bn

F 3 F

© Allianz SE 2011 Products Products F. ProductF. design and management risk 1) annuities annuities (FIA) Fixedindexed (FA) fixed annuities Traditional types product Primary Surrender charge may result in partial loss of principal; guarantees are backed by the financial strength and claims and financial strengthmay by chargetheSurrenderare partial in loss backedresult guarantees principal; of

–

fixed annuities ingeneral annuities fixed policyholder principal is not at risk equity or bond market indices; based on movements in stated policyholder is credited interest Annuity wherebycontract the is not at risk in the contract; policyholder principal accumulation stage on funds placed rate of interest during the policyholder is credited with a fixed Annuity wherebycontract the

. . . . Fixedindexed annuities regardless of accumulation value withdrawal of stated percentage benefit of base, withdrawal benefits which provide lifetime for Increasingly, are including FIAs guaranteed living Index returns are subject a: to may not be negative Indexed interest is typicallycredited annually and point interest will be calculated, including annual Policyholder has the option to elect how indexed - - gains off whichthe indexed interest is based Participation rate: the percentage of index in specified a period willthat be credited the to policyholder Cap: the maximum index performance - to - point, monthly sum, monthly average, etc. - paying abil ity of the issuing issuing the company of ity Top selling Top selling products in 2010 18% Plus Endurance 12% MasterDex5 18% OtherFIA FA 3%

MasterDexX

49% F 4 F

© Allianz SE 2011 Primary FIA product product FIA Primary F. ProductF. design and management risk MasterDex X overview MasterDex Note: must MasterDexbymust be Note: accompanied disclosure withinXsection 3) 2) 1) Income III rider Simple Indices Crediting Basics Consumer Price Index IndexBarclaysBond CapitalAggregateUS Compendium AdvantageSource:

......

Election of Election of lifetime income is from availableissuancepolicy Lifetime income payments are age Benefit base isequal to the highest of the accumulation valueor an annualincrease (rollup) Optional rider providing guaranteed withdrawalbenefit; available for a fee Blended (DowJones, BCAG S&P500, NASDAQ100, EUROSTOXX 50 Rates, caps and spreads are declared annuallyin advance of the yearpolicy months withindex value at beginning of year, limitedby an annualspread Monthlyaverage adding the 12 monthly returns over the policyyear, limitedby a monthly cap Monthlysum policyyear to last dayof year,policy limited byan annualcap Annualpoint option purchasesAllianz duration 10 Premium bonus Limited flexible premium deferred FIA Launched in 2008 - - - - Lowerinitial payments that increase withCPI Lowerinitialpayments that increase withanyinterest credited Levelpayments over remaining lifetime year surrender charge schedule

– - to –

- indexedinterest calculated based on change in indexvaluesin each month policy and MasterDex X MasterDex

point –

– indexedinterest calculatedby comparing average indexvalue for preceding twelve

largest largest sellingFIA product in industry for past two years –

indexedinterest calculated based on change in index valuesfrom first dayof - matched bondspurchasing whilederivatives to hedge/fund the liability 1 , , EURO STOXX 50, Russell) -

based and include3 optional payment patterns:

growth

F 5 F

© Allianz SE 2011 FIA provides accumulation and protection and accumulation FIA provides 100,000 120,000 140,000 160,000 180,000 200,000 MasterDex X illustration MasterDex F. ProductF. design and management risk Note: Must be accompanied by MasterDexbyMustbe Note: accompanied disclosure withinXsection 3) 2) 1) 40,000 60,000 80,000 By the 8% simple simple 8% theBy rate rollup point Annual first 10yearsthefor chargeseffect in surrenderthe 31.12.1 to results indexonfrom actual based31.12.00 interest indexed 01.01.01; issued onAssumes productavailablewasand 1/2001

Interest potential with insurance protection for longevity risks longevity for protection insurance with potential Interest

- to 1/2002 - point crediting 100% allocated to S&P 500 index; cap guaranteed to never be less less 0.50% bethan never to guaranteed cap index;500S&P to creditingallocated 100% point Accumulation Accumulation value (AV) AV with no indexed interest S&P 500 Benefit Benefit base

1/2003

1/2004 1

(USD) 1/2005

1/2006

1/2007

1/2008

1/2009

1/2010

188,000 108,000 141,811 1/2011 95,256

. . . . . 0; 0; after after income election Benefit base stops growing policyholder age election at base annually on based fixed percentage of benefit Withdrawal benefit limited to withdrawalform of benefit Benefit base only available in Assumed product features: premium Assumes USD 100k single - - - does not take into considerationinto take not does Annual Annual cap = 4.25% Rollup 8% simple = Premium bonus = 8%

F 6 F

© Allianz SE 2011 MasterDex X disclosures MasterDex F. ProductF. design and management risk the index. the of returns anystock, bond, or other investment underlying shares of an index fund, and FIAs do not participatedirectly in The contract purchaser is not buying shares of stock, a bond, or deliversthe most interest under conditions. allmarket No single crediting method or index allocationconsistently Multiplecreditingmethods and index allocations areavailable. Past interest creditingis not a guarantee of future results. of loss principal. vested and unvested bonus, anyearned interest, and a partial than 10 contract years. These charges result mayin a loss of annuitizationto begins prior the sixth contract or for year,fewer surrendered. partially or fullyThe same wouldapply if a surrender charge startingapply at the10% if will contract is don’t offer a bonus. premium theDuring 10 first contract years, other thatrestrictions are not included annuitiesthat similar in periods,interest lower lower rates, caps, higher spreads, or mayincludehigher surrender charges, longer surrender charge of the bonus that unvested.is Sincea this is bonus annuity,it during the 10 during the first contract year. If the contract is surrendered 10% on each contract anniversary. None of the bonus is vested The premium bonus becomes vested a 10 over

- yearvesting period,lose the client portion will

- yearperiod at

Product, and rider, feature mayvarybyavailability state. product. no representation regarding the advisabilityof purchasing the promoted byStandard & Poor’s and Standard & Poor’s makes The product America. is not sponsored, endorsed, sold, or licensed for use Allianz by Insurance Life Companyof North trademarks of The McGraw Poor’s stocks representingU.S.sectors. major industrial“Standard & Standard &500 Poor’s www.allianzlife.com 55416Minneapolis,Drive,MN Hills Life Allianz Insurance of Company 5701North America, Golden C52575 and R91077 professional before making anydecision. Youshould havea yourfull with discussion financial The purchase of an annuity is an important financial decision. ® ,” “S&P500,”,” “Standard & Poor’s 500,” and “500” are

- 01 and state variations are issued by ® index (S&P - Hill Companies, Companies, Inc. Hilland have been - 1297. 800.950.1962 500 ®

) is comprised ) comprised of is 500

© Allianz SE 2011 Products Products F. ProductF. design and management risk 1) GMAB GMIB GMDB GLWB/ GMWB VA guarantees Investment options Variable annuity General Allianz Vision variable annuity was the only VA product being sold in 2010in sold being VA productAllianzVision onlyvariablethewas annuity

–

variable annuities ingeneral annuities variable ......

available for for availablewithdrawal/surrender after a stipulated waitingperiod Guaranteed minimum accumulation benefit annuitization, regardless of contract value Guaranteed minimum income benefit regardless of contract value Guaranteed minimum death benefit or lifetime withdrawal of stated percentage of benefit base, regardless of contract value Guaranteed minimum/lifetime withdrawal benefit depending on whether any VA guarantees are elected Subaccount funds varyby investment strategy, risk profile, etc. and may limitedbe the assets of the insurer, and in some cases may allocate to a fixed account Policyholders allocate funds to equity/bond subaccounts segregated from varywillbased on account valueof the contract (i.e., subaccounts); benefit payouts performance of an underlyinginvestment portfolio Annuitycontract whosevaluefluctuates based on

–

– provides for a minimum payout upon death,

provides for return of minimum value through

–

provides for minimum account value

–

provides for annual

Top selling Top selling in products 2010 (Vision) 19% Protector Investment 3% Norider

Income Protector Income

78% F 7 F

© Allianz SE 2011 Allianz Vision variable annuity variable Vision Allianz F. ProductF. design and management risk 3) 2) 1) Bonus No withdrawalcharge Short withdrawal charge Base Contract broker/dealer. feature andProduct feature. bonus withoutthe variableannuities charges may thancarryand theyfees higher that understand threea subject to yearspayment3 = = years2 years 035%, = 100%.purchase 0%, year= and1 70%, complete sinc yearson vestingbased owner’s older Bonus birthday. payments the received 81st beforepurchaseon all bonus 6% Must select optionalrideran issue: at Income Protector or Investment Protector. investment options. the of asset valuenet the risk on TheMortality is based expensechargeand

Mortality and expense and expense Mortality risk charge risk 1.70% 1.75% 1.65% 1.40%

- year vesting schedule. As withAs schedule. vesting year

(for each purchase payment) purchase each (for

Withdrawal charge charge Withdrawal av ailability may ailabilityandmay vary by state e r eceipt of purchase payments: purchase of payments: eceipt

all bonus annuities, pleaseannuities, bonusall 9 years 4 years 7 years None

F 7a F

© Allianz SE 2011 Primary VA product VA product Primary F. ProductF. design and management risk and expenses, which should be read thoroughly and carefully before investing or sending money. carefullyor sending and before investing read thoroughlybe expenses, should and which features, product objectives,risks, charges, about prospectuses important The information contain To (800) call Investment a 542 Options, prospectus forVisioncontract obtain the underlying and surrender charge starting 8.5% at reduces which 0% in to the ninth contract year. Protector and 0.9% Investment for Protector, and these can fees to increase a 2.50%/2.75% maximum of and 2.50%. The Vision va The Income Protector and Investment Protector are optional riders available for an additional fee. The current individual/joi ...... guarantee Investment allocation options are limited with this Also provides traditional enhanced or GMDB feature issuance Election lifetime of income is available from policy performance and age attained increase after election depending on contract Lifetime income payments payments when elected contract value; this is used calculate to lifetime income anniversary value, an annual increase, current or Benefit base guaranteed lifetime withdrawal benefit (GLWB feature) Offers protected retirement income through an optional

Income Income Protector (GLWB) –

equal equal highest the to of quarterly

–

age

- – based based and can

Vision

Vision VA

. . . performance on remaining until time date target and contract allocations occurs over the of life the contract based Automated rebalancing more to conservative guarantee Investment allocation options are limited with this a target value feature (GMAB optional) Provides for levela of principal protection through - - -

Also Also provides traditional enhanced or GMDB feature Initial waiting period at least 10 of years future gains locked in on each contract anniversary Target value initially equal principal to payments with Investment Protector (GMAB)

nt nt fee is 1.05%/1.20% fee is 1.05%/1.20% for Income ria ble ble annuity a has maximum -

5427.

F 8 F

© Allianz SE 2011 VA provides market upside with income benefits income with upside market VA provides charges charges and 3.15%expenses of with a charge withdrawal begins that 8.5%at declines and 0%to over years. 7 each of listed Investment Option annual and an maintenance contract charge of 50 end of $ at each year.Alsoincluded the are The historical Pimco Total returns Return for the Fund at were 6/30/11: 1yr: not reflected. of for 2.50% the Income Protector (as a percentage of Base) the Benefit are in reflected the values The shown. current rider annual maximum mortality and expense risk charge 1.40% of for the contract, Base average an investment option expense of 1.05 assume the Income Protector is selected at issue, and no withdrawals (other than Lifetime Plus Payments) partial or annuitiza might work down in a market. It not predict does or project the actual performance Allianz of VisionSM Variable Annuity or it This hypothetical example is to provided show conceptually how the 8% Annual Increase, automatic quarterly reset feature, and F. ProductF. design and management risk (USD) illustration Vision Protector) (Income 100,000 120,000 140,000 160,000 180,000 200,000 40,000 60,000 80,000 1/2001

1/2002 S&P 500 Benefit base Account Account value

1/2003

1/2004

1/2005

1/2006

1/2007

1/2008 - 5.38%,5yr:4.15%, 10yr:figures 3.53%; reflect de

1/2009

1/2010

149,220 185,087 1/2011

95,256

. . . . . after after income election Benefit base stops growing election (e.g., 4.5%) policyholder age time at of base annually on based fixed percentage of benefit Withdrawal benefit limited to in withdrawalform of benefit Benefit base only available Assumed product features: premium Assumes USD 100k single - - s s i cha nvestment nvestment These options. examples tio Return Return fund allocation to PIMCO Total Illustrated full with step a quarterly reset and Rollup 8% simple = with

rge rge of 1.05% to (subject change) is ns are taken. Please note that an si ngle Lifetime ngle Lifetime Payments Plus %, %, - and a maximum maximum and a rider charge up up account to value duction of actual expense duction expense actual of

ma ximum ximum potential

F 9 F

© Allianz SE 2011 Allianz Vision Variable Annuity Variable Vision Allianz . . . VAs designed investments long term are growth. investment or income to guarantees offer that riders optional purchase however, lose money;to can clients VAs is possible and it risk, involve market beoutlived can’t that stream an income for opportunitythe and options, investment variable select in uponchanges based accumulation for potential the deferral, offertaxThey purposes retirement for

. . penalty 59 age to prior taken if and taxes, income VAs from Withdrawals to subject are fees and administrative and investment charges, risk M&E as such charges, VAs involve insurance - 1/2, an additional additional taxan federal 10% 1/2,

- related fees & fees related

F 9a F

© Allianz SE 2011 reflected reflected would be higher. (single Lifetime Plus Payments), which is percentage a of the Benefit Base. The current rider charge of 1.05% (subject to cha contract, and an average investment option of expense 1.05%. The net rate of return also considers the maximum rider charge o All reflect values the net rate of return of This hypothetical examples an reflects initial payment purchase of $100,000 and gross a aggregate investment option return of Income Protector in a down market adown in Protector Income F. ProductF. design and management risk

Distribution Accumulation Year 3 2 1 7 6 5 4

contract contract value End $95,042 $41,718 $60,331 $69,982 $79,872 $90,005 $50,911 - of

- year

- 6.50%, 6.50%, takes which into consideration an annual maximum mortality and expense risk

Benefit Benefit Base $108,000 $116,000 $116,000 $116,000 $116,000 $116,000 $116,000

Payments Payments Lifetime Plus $5,220 $5,220 $5,220 $5,220 $5,220 NA NA

Surrender Surrender Value $38,718 $55,331 $63,482 $72,372 $81,505 $86,542 $46,911

nge

charge charge of 1.40% the Base for f 2 ) is not illustrated, and values

00% 00% in the seven first years. .50% for the Income .50% the Income for Protector Benefit Benefit Value Death $100,000 $100,000 $66,796 $74,427 $81,477 $88,044 $94,200

F 9c F

© Allianz SE 2011 reflected reflected would be higher. (single Lifetime Payments), Plus which percentage is a of the Benefit The Base. current rider charge of 1.05% to (subject cha contract, and an average investment option of expense 1.05%. The net rate of return also considers the maximum rider charge o All reflect values the net rate of return of 2.44%, takes which into consideration an annual maximum mortality and expense ri This hypothetical examples an reflects initial payment purchase of $100,000 and gross a aggregate investment option return of Income Protector fixed rate of return of rate fixed Protector Income F. ProductF. design and management risk

Distribution Accumulation Year 3 2 1 7 6 5 4

contract contract value End $102,862 $105,580 $102,815 $90,431 $93,790 $96,976 $99,997 - of

- year

Benefit Benefit Base $108,000 $116,000 $116,000 $116,000 $116,000 $116,000 $116,000

Payments Payments Lifetime Plus $5,220 $5,220 $5,220 $5,220 $5,220 NA NA

Surrender Surrender Value $87,431 $89,790 $91,976 $93,497 $95,362 $97,080 $94,315 sk

nge

charge charge of 1.40% the Base for 8. f 2 ) is not illustrated, and values 00% 00% in the seven first years.

.50% for the Income .50% the Income for Protector Benefit Benefit Value Death $102,862 $105,580 $102,815 $90,431 $93,790 $96,976 $99,997

F 9d F

© Allianz SE 2011 reflected reflected would be higher. (single Lifetime Plus Payments), which is percentage a of the Benefit Base. The current rider charge of 1.05% (subject to cha contract, and an average investment option of expense 1.05%. The net rate of return also considers the maximum rider charge o All reflect values the net rate of return of 2.15%, takes which into consideration an annual maximum mortality and expense ri This hypothetical examples an reflects initial payment purchase of $100,000 and gross a aggregate investment option return of Income Protector in fluctuating market fluctuating in Protector Income F. ProductF. design and management risk

Distribution Accumulation Year 3 2 1 7 6 5 4

contract contract value End $107,023 $105,248 $110,845 $115,773 $86,027 $98,492 $91,196 - of

- year

Benefit Benefit Base $143,748 $143,748 $133,100 $133,100 $133,100 $121,000 $112,200

Payments Payments Lifetime Plus $6,468 $5,989 $5,989 $5,989 $5,445 NA NA

Surrender Surrender Value $100,523 $108,273 $102,345 $83,027 $94,492 $86,196 $96,748 sk

nge

charge charge of 1.40% the Base for 8. f 2 ) is not illustrated, and values 00% 00% in the seven first years.

.50% for the Income .50% the Income for Protector Benefit Benefit Value Death $107,023 $105,248 $115,773 $110,845 $86,027 $98,492 $91,196

F 9e F

Product management Product management (newand inforce) Product design

...... impact impact benefit costs mortality improvements may Longer expectancies life due to expected profitability as lapse may rates, etc. impact policyholder behavior such Deviation from expected may impact hedging costs Changes in volatilitymarket by equity market performance Credited amounts are driven pressure on earnings investments can cause Defaults on fixed income increase in lapse activity Higher rates may cause may cause spread compression investment yields and Decreasing rates reduce

4 3

ALM (asset (asset ALM/ liability management) Hedging

Mitigation 1 1 1 3 1 1 1

2 2 2 2 2 2

4 4

F 10 F

Product management Product management (newand inforce) Product design

. . . . impact benefit costs mortality improvements may Longer expectancies life due to expected profitability as lapse may rates, etc. impact policyholder behavior such Deviation from expected guaranteed benefits volatility can increase value/cost of Negative market performance and benefits higher value/cost guaranteed of Lower interest rates can lead to

4 3

ALM (asset (asset ALM/ liability management) Hedging

Mitigation 1 1 1 1

2 2 2 2

3 3

F 11F

© Allianz SE 2011 Illustrative FIAIllustrative structure F. ProductF. design and management risk 3) 2) 1) 4.5% 4.5% and a targeted levelprofitability of targeteda and covernonpolicyholder to expenses,Reflects interest in of thecredited yieldto excess assets (book)reservesbacking onrateEarned reservesonBased Yield 5.0% Product design 1

guarantee Excess above above 1.75% 1.75% FIAeconomics product 2.0%

Option/credit

guarantee Minimum 0.25% 0.25%

0.5%

1 -

(new business) (new

expenses 2.5% 2.5% Spread Spread before before 3.0% -

- interest policyholder benefits (bonus,policyholder benefits interest Targetprofitability Product management Product New New business Payback period NBM IRR 7. Premium 7. Premium bonus 6. Commissions 5. valueContract 4. Rider charges 3. Income guarantees 2. Index caps 1. Credited rates guarantees

NBM/IRR

rider guarantees), taxes,riderguarantees), 7 2. 2. Index caps 1. Credited rates Inforce 13 - ~2.5% 8 years

- 14%

IRR F 12 F

© Allianz SE 2011 Illustrative VAIllustrative structure F. ProductF. design and management risk 1) expense expense Mortality (M&E) 1.4% 1.4% Based on account value account onBased 1.7% fees fees Product design & 1

0.4% 0.4% Fund Fund 0.6% VAeconomics product fees

0.9% 0.9% Rider 1.2% fees

1 guarantees

(new business) (new Cost of Cost of

0.9% 0.9% 1.2% -

expenses Margin 2.0% 2.0% before before 2.3% -

Targetprofitability Product management Product New New business Payback period NBM IRR 4. 4. Funds 3. valueContract 2. Income guarantees 1. Fees (rider, M&E) guarantees

NBM/IRR

5 2. 2. Funds 1. Rider fees Inforce 13 - ~2.5%

6 years

- 14%

F 13 F

© Allianz SE 2011 . . . F. ProductF. design and management risk 1) defining key product attributes product key defining Tailwhen part integral an is thus analysis risk scenarios tail these for limits defined withinstay as as well targets achieveto designed Products risks market and behavior policyholderfor scenarios case worstwellas as MCEV IRR and both considers design Product Impacts based upon 2010 VA VA sales levelUSD 3.2bn of 2010 uponImpacts based - - - Product design 1 Levers Guarantees Features Taillevers design and product product through managed risk 1 3 2

Management actions Market risk Non

Addressing tail tail risk Addressing -

market risks

Scenario

levers Exerciseproduct Market volatility Policyholderefficiency (USD mn) VNB VNB -150 -100

100 VA VNB risk (annualized tail -50 50 0

PH efficiency

. . . . Vola +10%

Reduceequity fund exposure by10% Move to max fee bylevel year 4 10% for for persistency and fund allocation Most efficient policyholderbehavior - p higher volatilitylevel going forward

Mgmt action 1 )

Total

F 14 F

© Allianz SE 2011 -2,5% -1,5% -0,5% F. ProductF. design and management risk 2) 1) WeeklyNBM 0,5% 1,5% 2,5% 3,5% 4,5% management Guaranteed minimum minimum Guaranteedvalue illiquidityExcludes premium from business calculation newmargin of Product 2

Jan Index cap changes

4 3 2 1

Feb FIAexample management product December December 2010: Income increased Simple rider fee December 2010: reduced X bonusMasterDex October 2010: rider fee charged to GMV September 2010: reduced X bonusMasterDex

Mar 1

– Apr

FA FIA /

May

Jun 2010

Jul

FA / FIA NBMFIA / FA Aug

Sep 2

Oct

10yrswap 4 3 Nov

Dec

Not charged Previouslevel Jan 60bps 10% 8%

2011

Feb

Mar

New levelNew . . . . Charged 75bps 7% 8% 2010 VNB: USD152mn 2010 NBM: 2.1% rate environment through a verylow interest profitability on products Ability for management of during 2010 Strong actions taken preserved through 2010 Profitable margin

F 15 F

© Allianz SE 2011 -6% -5% -4% -3% -1% NBM ProductF. design and management risk 1) 0% 1% 2% 3% 5% 6% 7% management Before expense overrunexpenseBefore Product Pay Rolluprates Bonus rates Funds fees Rider 2 0.3%

Q1 VIX

out rates / rates age bandsout

U.S. 10yr

0.1% Q2 2008

VA product management example management VA product

0.7%

- 4.6% Q4

- 4.3% Q1

- 1.1% Q2 2009

0.4% Q3

0.5% Q4 Old products

VA management VA management levers 2.2% new products Q1 Launch Launch of

Significant de

- 2.3% risking

Q2 2010

2.3% Q3

New products New

1.8% Q4

2011 Q1 2.1%

swap 10

New business New business only New business and legacy book - 0% 1% 2% 3% 4% 5% yr

...... Actions taken 2010 2010 VNB 2010 NBM product changes Enhanced ability make timelyto volatile conditions market Focus on sustainability under Launch newof riders in 2009 3Q 1Q 2009 Living benefit riders suspended - - - of of product Significant de

Reduced Reduced fund volatility Lower benefits Higher fees

1 1 : USD : 68mn : 2.2% :

risking

F 16 F

© Allianz SE 2011 F. ProductF. design and management risk management Interest Interest credit / option to policyholder Averageguarantee minimum Product spread Portfolio Portfolio Product Business Business in force yield 2 5.5% 2.8% 2.7%

4.5% Sufficient levers to protect targeted returns targeted protect to levers Sufficient

earn target profitability

Required yield to to yield 150bp 1.3% 2.7% 4.0%

FIA

money yield Newbusiness New 2.0% 2.9% 4.9%

earn target profitability Required yield to to yield 170bp 0.3% 2.9% 3.2%

. . . Fund lineup within certain funds equity exposure Ability to reduce volatility lineup to reduce Have changed fund fund allocation at 40 Separate accounts Newand legacy - 50% 50% equity

rider fee Current Current Newbusiness 0.9% 1.2% -

fee fee (post Maxrider 2.75% issue) 2.5 -

F 17 F

© Allianz SE 2011 F. ProductF. design and management risk 2) 1) 31.03.11 (USD bn) Account Account value at Primary products Rho hedge applies to Vision business issued issued 8/2009Vision afterbusiness applies to hedgeRho 2Q2011in VA gamma hedging of Introduction Unhedged risks Hedging Hedged risks Benefit Benefit type instruments 3 Hedging governed by stringent monitoring and risk limits risk and monitoring stringent by Hedging governed

Hedge

Hedging overview Hedging

Rho (immaterial) Rho Annual indexing Annual Futures, vanilla Futures, Delta, gamma, Delta, MasterDex, Endurance options credits

vega 39.0 FIA

interest rate swaps, rate interest Delta, gamma Delta, GMWB, GMAB GMWB, return swaps, return Futures, total Futures, options Vision Vega rho 9.5 2

1 ,

Alterity,Rewards, Delta, gamma Delta, GMIB, GMWB GMIB, return swaps, return Futures, total Futures, Valuemark Vega,rho options

9.7 VA

Gamma, vega, rho vega, Gamma, Futures, total Futures, return swaps return GMAB High 5 High Delta 7.3

F 18 F

© Allianz SE 2011 . . -10 Allianz (USD bn) flowAllianz cash Life ProductF. design and management risk 10 12 -8 -6 -4 -2 case, and up/down 100bp shocks 100bp up/down case, and stochastic MCEV(ALIM)200 of baseaverageforscenario as eachLiabilityrepresentedthevaluessets are 0 2 4 6 8 where necessary Changes to strategic asset allocation recommended Quarterly monitoring of asset and liability durations 2011e ALM 4

2014e spreads and liquidity and spreads of maintenance enables matching ALM 2017e

2020e

2023e

2026e

2029e Net cash Net cash flow Liability assets Reserve 2032e

2035e

2038e Effective duration trend (in years) Effective trend duration 6.1 1Q10 Liability assets Reserve 6.3

5.8 2Q10 6.7

6.3 3Q10 6.7 6.3 4Q10 6.5 F 19 F

© Allianz SE 2011 Regular monitoring of key risks of key monitoring Regular F. ProductF. design and management risk New business New business NBM by product New business IRR by product Liquidity Counterparty collateral Investment performance VA basis risk Policyholder behavior Product financial sensitivities Hedge exposure limits VA hedge effectiveness FIA hedge effectiveness

Daily

Weekly

Monthly

Quarterly

F 20 F

. . . . Strong risk management framework management risk Strong accumulation and income accumulation both value through customer provide Products product profitability and risk and profitability product managing of record track proven Allianz a has Life profitability inforce and newbusiness available manage to are Levers

F 21 F

© Allianz SE 2011 possibility of such damages. consequential damages (including profits), even lost if notified of the Barclays Capital any have any liability for special, punitive, or indirect, included therein. Without limiting any of the foregoing, event in shall no limitation, Capital the Barclays Aggregate U.S. Bond Index, any or data or with use respect to Capital the Barclays indices, including without disclaims all warranties of merchantability fitness or for particular a purpose Capital makes no express implied or and warranties, hereby expressly connection withlicensed the hereunder rights for or any other Barclays use. without limitation, the Barclays Capital Aggregate U.S. Bond Index,in person or entity from the of use Capital the Barclays indices, including otherwise obtained by Allianz, owners of Allianz products, any or other completeness the Barclays of Capital indices, any or data included therein, or Barclays Capital not guarantee does the accuracy, quality, the and/or connection with the administration, marketing, or trading Allianz of products. be converted cash. into Barclays Capital no has obligation or liability in determination or calculation the equation of by Allianz which are products to timing of, prices at, or Allianz quantities of to products be issued or in the is not responsible for and not has participated the determination in of the calculating the Barclays U.S. Capital Aggregate Bond Index.Barclays Capital of Allianz products consideration into in determining, composing, or Barclays Capital no has obligation to the take needs of Allianz or the owners calculated Capital by Barclays without to regard Allianz or Allianz products. Capital U.S. Aggregate Bond Indexwhich is determined, composed, and North America and affiliates its (“Allianz”) is the licensing of the Barclays Barclays only Capital’s relationship Allianz to Insurance Life Company of Aggregate U.S. Bond Index, track to general bond market performance. Barclays Capital indices, including limitation, without the Barclays Capital in securities generally or in Allianz products particularly or the of ability the products any or the member public of regarding the advisability investing of representation or express warranty, implied, or to the owners of Allianz endorsed, sold, promoted or Capital. byBarclays Barclays Capital makes no Capital (“Barclays Inc. Capital”). Allianz products are not sponsored, Barclays Capital Aggregate U.S. Bond Index are trademarks of Barclays agency, corporate, and mortgage investment The Barclays Capital Aggregate U.S. Bond Indexcomprised is of U.S. disclosures Additional F. ProductF. design and management risk Services, LLC, FINRA, 5701 55416 Services,Drive,Minneapolis, GoldenMN Member Hills Products issued byAllianzLife Insurance Company of North America. Variableproducts are distributed byaffiliate,its Allia - grade, fixed - rate bond market securities, rate market bond securities, including government

- backed backed securities. Barclays Capital and

Frank Russell Company. benchmark for small stock investors. is Russell 2000 a registered mark service of companies the within larger Russell 3000® Index. It is looked often as one at Russell 2000® is an Indexequity index representing 2,000 the smallest of ANDRESPECT BEARNOTOTHE LIABILITY PRODUCT(S). WITH promoted by the Corporations. NOCORPORATIONSTHEMAKE WARRANTIES to legality their suitability. or The product(s) are not endorsed, issued, sold, or North America. The product(s) have not been passed on by the Corporations as the Corporations) and are licensed for byuse Life Allianz Insurance Company of registered trademarks of Group, OMXInc. NASDAQ with(which affiliates its are capitalization. The Nasdaq non The Nasdaq shall not have any liability with respect thereto. the Index are wayin sponsored, no endorsed, sold, or promoted by STOXXand trademarks) of STOXXZurich, Limited, Switzerland. Allianz based products on and Spain. STOXX The50 EUROis the intellectual property (including registered France, Germany, Greece, Luxembourg, Ireland, Italy, the Netherlands, Portugal, index50 covers stocks from 12 Eurozone countries: Austria, Belgium, Finland, provides blue a EURO Index, STOXX50® Europe’s leading blue representation regarding the advisability of investing in such product(s). endorsed, sold, promoted or byJones, Dowand Jones Dow makes no XAnnuity, based the Dow on Jones Industrial Average, is not sponsored, purposes by Life Allianz Company Insurance North America. of Allianz MasterDex marks of Jones Dow& Company, and Inc. have licensed been for for use certain overall economy. “DowJones” and “DowJones Industrial Average” are service based on the average closing prices of 30 stocks active U.S. representative of the The Jones DowIndustrial AverageSM popular a indicator is of the stock market - financial financial securities listed on Stock The Nasdaq Market, based on - - 1297. 800.542.5427 www.allianzlife.com 100 100 includes Index® the largest 100 of domestic and international - chip chip representation of supersector leaders in the Eurozone. The

- 100®, 100®, Nasdaq - 100 100 Index,and Nasdaq®, OMX®are

- chip chip index for the Eurozone, nz

Life Financial

New York, July 21, 2011 Financial highlights (1/2) highlights Financial AuM (USDbn) Operating profit Statutory premiums (USD bn) 2) 1) G. G. performance Financial Corporate line consists lineconsists Corporate primarily surplus income assets oninvestment of earned policychangefor accounting profit 2008/09retrospectivelyin Operatingadjusted 2006 10.9 532 62

(USDmn) 2007 527 9.5

2008 - 8.8 117 62

2009 593 9.0 77

2010 10.8 472 87

FIA / FIA FA VA Other

FA FA / FIA 510 account Separate

- 192 VA VA 3.2 Other 0.5

22% 2010

Other 31

FIA FIA FA /

7.1 78%

Corp. 123

account General Total 472

G 2

© Allianz SE 2011 Financial highlights (2/2) highlights Financial MCEV(USD bn) Statutory RBC ratio (%) Expense ratio 1) G. G. performance Financial Expense ratio equal to internal expenses divided by operating revenues (defined as investment income interest of creditedincome investment as net(defined revenuesby operating dividedexpenses internal to ratioequal Expense 2006 27.6 297 4.8

(%)

2007 26.5 4.2

277

2008 24.8 - 206 4.6

2009 21.8 3.9 276

19.2 2010 5.9 294

(USD mn) (USD mn) 4,903

NAV pl us fee revenues)fee us Expenses 31.12.10

294%

456 +11%

Value of in force force (VIF)

2010

1,036 Operating revenue

31.03.11 - p 2,374 305%

31.12.10 MCEV 5,938 19.2%

G 3

2,284 2010 2010

141 1Q 1Q

+16.2%

10.6% 2,655

2011 2011

126 1Q 1Q

(USD mn) Statutory premiums . . . Total Other FA VA FIA NBM of NBMof 3.0% in 1Q 2011 positively impacted byone Solid operating profit result in 1Q 2011; 1Q 2010 of VA riders in 3Q 2009 Strong premium development following re

2009 2,776 1,222 1,120 1Q

121 313

off effects

2010 2,284 1,421 1Q 121 698 44

2011 2,655 1,507 1Q 125 958

65 -

launch

Δ +16.2% +47.7% +37.2% 1Q10 +3.3% +6.1% 1Q G 4 11 /

© Allianz SE 2011 Development of variable annuity block annuity of variable Development G. G. performance Financial VA account value: new business versus legacy book 2) 1) Total USD VA business issued issued 3Q2009 starting VA business plancurrent business onBased AV

89% 11% 26bn 10A

28bn 11e

75% 25%

30bn 12e 64% 36%

32bn 13e 53% 47% 1

(% of AV)

. . . (e.g., interest rates) based on market conditions Profitability potentially accelerated newbusiness positively impacted bybuild Profitability expected to be by2013 Legacy book to drop to ~50% Legacybook business New

up of

G 5

© Allianz SE 2011 (31.12.2010,mn) USD overview annuity Variable 3) 2) 1) G. G. performance Financial VA guarantees Total GMWB GMAB GMIB GMDB Total GMWB GMAB GMIB GMDB Represents the sum of the most valuable benefit for each product; products generally offer more than one benefit whileo onlybenefit one more offer thangenerallyproduct;products eachbenefitfor most valuable thesum of Representsthe loweringtime, actual of periodoverapayments exposure orpayments Accessing b thevalue. account the and base currentthe benefit betweenrisk at difference undiscounted amount is the Thenet nowithridervalue account selected; excludes / purchasedVA forwherevaluerider a Reflects beenhas account

Significant recovery since end of 2008 end of since Significant recovery

IFRS reservesIFRS Account Account value 24,487 1 6,623 9,013 7,437 1,414

701 434 132 (GMxB) 80 55

100% 100% 27% 37% 30% 62% 19% 11% 6% 8% % %

10% 15% 20% 25% 30% VAin GMxB VArisk at amount net

Mar-08 0% 5% amount amount risk at net Max GMWB GMAB GMIB GMDB

Jun-08

Sep-08

Dec-08 3 -

the Mar-09 1Q 1Q 08 1,363 1,214 1,030 - 654 498

Jun-09 of (% money AV)

ne Sep-09 ene 6% benefit can becanelected benefit 2 fit base may require taking lifetime may baselifetime require taking fit

4Q 4Q 08 Dec-09 5,213 2,888 1,498 4,341 4,554

Mar-10

Jun-10 4Q 4Q 09 3,132 1,708 1,059 2,631 2,364

Sep-10

Dec-10 g in 2011in g continuin 4Q 4Q 10 2,191 1,220 1,800 1,497 Trend 785 Mar-11

Jun-11 G 6

© Allianz SE 2011 (USD bn) (USD NB premiums of PV in %of (VNB PV of NB premiums) margin Newbusiness on margin improvement margin on impact significant had have actions Product 1) G. G. performance Financial

Adjusted for illiquidity premium, EIOPA yield curve extrapolation and change of cost capital of chargecost illiquidity forof changeAdjusted premium, yieldEIOPA curveand extrapolation - 2Q 2Q 2.2 0.6

2009 2009 3Q 3Q 0.7 1.7

4Q 4Q 1.0 2.2

1Q 1Q 2.1 2.4 2.2

2Q 2Q 1.8 2.3 2.5

2010 2010

3Q 3Q 0.5 1.7 Adjusted NBM Adjusted 2.8

0.6 4Q 1.6 4Q 2.9

2011 2011 1Q 3.0 1Q 2.7 2.6

(USD mn) (USD Value newbusiness of 2Q - 14

2009 3Q

4Q 22

1Q 53 46

2Q 58 46

2010

3Q 14 49 Adjusted VNB Adjusted

4Q 16 48

2011 1Q 69 78 G 7

© Allianz SE 2011 MCEV development MCEV NAV G. G. performance Financial 2) 1) VIF Includes impact of movement from VNB point of sale to 31.12.2010 market market conditions impact sale from 31.12.2010 of Includes to movement VNB of point for adjustment illiquidity includingadjustments, annualpremium, reflects andvalueStarting yieldextrapolationEIOPA curve

Starting Starting value 2010 3,903 4,583 MCEV driven by strong contribution from inforce and new business and new inforce from contribution strong by driven MCEV 680 1

contribution contribution to to NAV Inforce Inforce 1,217

Change Change in value of value of inforce (VIF) - 27

business

New 207

Dividend - 41

ending ending 4,903 value 2010 1,036 5,938

Total Life VA FA/FIA

2.0% 1.2% 1.6% 2.1% NBM

ch 12M 12M 2010 ange of cost chargecost capital of of ange

NBV 207 152 52 3

3.0% 1.1% 2.5% 3.4% NBM

1Q 1Q 2011

NBV 78 24 54 1

G 8

© Allianz SE 2011 (USD mn) sensitivities VNB and value Embedded 1) G. G. performance Financial (VNB) business Value of new (MCEV) value Embedded Adjusted for illiquidity premium, EIOPA yield curve extrapolation and change of cost capital of chargecost illiquidity forof change Adjusted premium, yieldEIOPA curveand extrapolation

5,938 Base Base case 207

by 10% Drop Drop in equity value - - 53 21

- 100bp - - 27 76 Risk free

Economic Economic factors

+100bp - 109 3

swaption +25% +25%

- 233 - 6 Volatility

equity

+25% +25% -

- 435 28

expense - 108 10% 11

Non

Death Death - risk economic factors 20 3 - 5% 5% mortality

Longevity risk - - 41 1

lapse - 10% 10% - 12 34 G 9

© Allianz SE 2011 (USD mn) (USD expenses Insurance Tight expense management expense Tight Operating revenues (USD mn) revenues (USD Operating ratio Expense 1) G. G. performance Financial credited plus fee revenues, etc.) revenues,feecredited plus interest of income investment as net(defined revenuesby operating dividedexpenses internal to ratioequal Expense Efficiency improvement expected to continue to expected Efficiency improvement

1,771 2006 27.6% 2006 489

1,864 26.5% 2007 2007

494

1,942 2008 24.8% 2008 481

21.8% 2009 2,102 2009 458

19.2% 2,374 2010 2010 456

CAGR CAGR - 7.6% 1.7%

18.5% 2010 1Q

- 0.7% - p

17.8% 2011 1Q

G 10 G

© Allianz SE 2011 Asset growth through strong flows and returns and flows strong through growth Asset 31.12.2010 income, other Interest similar & Inflows 31.12.2009 1) bn) (USD reserves backing Assets Outflows G. G. performance Financial Includes surrenders, death claims, claims, excludesexpenses/commissions surrenders,annuitizations; Includes and death Positive net policyholder flows throughout the financial the financial crisis throughout flowspolicyholder Positive net

+11.2%

76.1

+4.0 84.6 - +10.8 6.3

64.8 2006 4Q

70.5 2007 4Q

68.0 2008 4Q

76.1 2009 4Q

84.6 2010 4Q

G 11G

© Allianz SE 2011 Generating free surplus to fund growth and dividends and growth fund to surplus free Generating (USD bn) 2009 2) 1) G. G. performance Financial 2010 2009 Assumes strain relatedbusiness Assumes newlevelsandannual consistent statutoryBasedonavailable capitalless required agency ratingcapital -

2010 statutory free surplus free statutory2010 YE 2010 YE free surplus Newbusiness In 2009 YE free surplus Newbusiness In 2008 YE free surplus

- - force force

+0.5 +1.0 +0.7 - - -

0.5 0.0 0.4 0.3

. . . . 2011 and future years Planning to continue to pay dividends in in the past nine months Approximately USD90mn of dividends USD100 translates to approximately generation of 2 A normalized statutory free surplus byhigher requirements to market performance but impact offset 2009 - 2010 returns above average due - 200mn annually - 4% 2

of of available capital

G 12 G

Companylevel action Statutoryrequired capital Availablecapital RBC ratio RBC 4.8 31.12.10

294%

1.6

based capital ratio (RBC) capital based

+11%

- p 4.8

31.03.11

305% 1.5

Ratings: Equity markets Interest rate Interest rate +200bps Ratio of 31.03.11as Estimated sensitivity Estimated Moody’s AM Best S&P

- 150bps - 30% AA A2 A

Rating notch 3rd 3rd 6th

292% 299% 305% 309%

G 13 G

© Allianz SE 2011 (31.03.2011) portfolio Investment G. G. performance Financial 2) 1) Quality Investment mix Fixed income Fixedportfolio income USDUSD payablecollateral investment netsecurities 123mn 600mn andlending Cash/ Pfandbriefe. partnershipsowned, and includes assets; otherrealReflects estate general IFRS account market of values Not rated Below BB BB BBB A AA AAA Other Other termCash/short Treasuries ABS/CDO Municipal MBS/CMO Mtg Comm’l CMBS Corporate

14% 57% 26% 28% 13% 26% 1% 2% 3% 4% 4% 7% 8% 3% 2% 2%

Total 67.2bnTotal USD

Comments Unrealized gains (USDbn) . . . book book value Market value of all asset classes greater than General account portfolio managed PIMCO by by product design Portfolio focused on credit assets driven

31.12.10

2.9

sh ort term term ort excludes

31.03.11

2.7

G 14 G

14% 27% 57% 40% 39% 13% 2% 4% 3% 1%

Total 38.6bnTotal USD

Comments Unrealized gains (USDbn) . . . . Approximately holdings5% of are private placements benchmarks Overall portfolio quality consistent withmarket its minimal 2009 Corporate portfolio experienced no defaults in 2010, Average rating: A

- 31.12.10

1.9

31.03.11

1.7

G 15 G

© Allianz SE 2011 (31.03.2011) CMBS G. G. performance Financial 2) 1) Quality Credit support Cash flow available to meet interest principalrequirementsmeet andCash to flow available credit loss AZ experiencesLifeany experiencwould that bondholders of percentage to equates versusbalance;class dealbalances total subordinate of Percentage BBB A AA AAA <20% 20 25 30%+

- -

25% 30%

<1% 13% 78% 30% 65% 9% 2% 3%

Total 9.6bnTotal USD

Comments Unrealized gains (USDbn) . . . MV/BV performance performance MV/BV 25% > since 2008 Debt service coverage ratio CMBS portfolio > 30% credit support

31.12.10 0.7

e 1 e 00% loss beforeloss 00%

2 31.03.11

> 1.5 > 0.7

G 16 G

© Allianz SE 2011 (31.03.2011) mortgages Commercial G. G. performance Financial Region Investment mix Mid AtlanticMid New England Central WN EN Central Mountain S Atlantic Central WS Pacific Medical office Retail Office Multi Warehouse - family

10% 11% 13% 46% 10% 20% 30% 36% 3% 3% 5% 9% 4%

Total 5.3bnTotal USD

Comments Loan . . . . hotels, hotels, land development, mezzanine No exposure to performing worst construction, assets: during crisis, only three foreclosures Historyof strong underwriting led minimal to losses 2011 increasing asset allocation in rationalized market in slowAfter production periods in 2009 Average LTV 60%,

80 70% -

value (LTV)

<1% 15% 32% 53%

2010, 2010, G 17 G

aspiration

(USD) 3yr

Operating profit

~10% p.a. Growth of

. . . factors Success growth profit and operating asset on both impact negative or apositive have conditions can market Caveat: available targets achieve to levers management Product market retirement the in opportunity Capturing

G 18 G

Mohamed A. El-Erian PIMCO CEO & Co-CIO Day

New York, July 21, 2011 Outline H. Positioning our clients to benefit the from multi What lies ahead for PIMCO as an integral part of the of part an integral as PIMCO Allianz for lies Group? ahead What responding? Howis PIMCO industry? management investment the for mean it does What clients? our for mean it does What markets? global and the economy for outlook is the What

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© Allianz SE 2011 have unthinkables previously context: The H. Positioning our clients to benefit the from multi . . addition … In ...... etc, etc, etc … etc etc, etc, economies stronger and of sheet ECB the of Contamination and Portugal Ireland Pakistan), than (worse Greece for ratings credit Junk crisis debt peripheral Eurozone nature in structural is increasingly that high unemploymentPersistently U.S. AAAand … rating, S&P for negative outlook Triple calamities Japan in uprisings Middle East The The bumpyjourneyto aNewNormal

become thinkable become

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© Allianz SE 2011 In sum, a changing global paradigm paradigm global a changing In sum, H. Positioning our clients to benefit the from multi Which influences … influences Which … staffing and investing for the future the staffingfor … andinvesting agility frameworkintellectual / and leadership thought … design product … servicing client … positioning investment …

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H 4

© Allianz SE 2011 Secular outlook themes: navigating balance sheets balance navigating themes: outlook Secular H. Positioning our clients to benefit the from multi it is about is also it To about just is not it clients, all well for navigate this investors for consequential implications with in ways,will different and companies respond sectors Countries, lot matter…a to continue balance sheets entitlement, and credit debt leverage, of age” “great off Coming the challenges structural unusual facing multi withremarkable operating is It levels and global national the both multi major of midst the is in economyGlobal how how you think you - speed world

speed dynamicsand speed

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© Allianz SE 2011 Secular outlook themes: multi themes: outlook Secular H. Positioning our clients to benefit the from multi Source: Haver Analytics, HaverSource: Analytics, IMF Emerging Markets versus G versus Markets Emerging 10 12 - - 0 2 4 6 8 4 2

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H 6

© Allianz SE 2011 the changed patterns of surpluses and deficits and of surpluses patterns changed the themes: outlook Secular H. Positioning our clients to benefit the from multi Source: Penn World World TablePennSource: Current Current Account global (% of GDP) - - 0 1 2 2 1

1991

1993

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- speed world 2001

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H 7

© Allianz SE 2011 a challenging stock and flow disequilibrium flow and stock a challenging themes: outlook Secular H. Positioning our clients to benefit the from multi Source: World World Source: Bank, IMF . . involves involves significant andrisks costs while aviable short press, printing the of use Massive pressure under come maystanding government’s credit the U.S. deficits, trillion fiscal plus annual 1 and USD creditors its owedto debt government federal of USD 14trillion over With financial markets financial and capital deep, wellto Access global public and other goods currency reserve Dollar the as U.S. The factors Offsetting contract enforcement contract U.S.’The and law ruleof

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© Allianz SE 2011 of the U.S. unemployment issue unemployment U.S. of the side structural the themes: outlook Secular H. Positioning our clients to benefit the from multi Source: HaverSource: Analytics U.S. teen unemployment teen U.S. long U.S. - term unemployment term

U.S. teen unemployment unemployment rate U.S. teen Recessions Recessions longer than 27 weeks27 thanlonger unemployed% of

- speed world

10% 12% 14% 16% 18% 20% 22% 24% 26% 28% 10% 15% 20% 25% 30% 35% 40% 45% 50% 0% 5%

1960 1960

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H 9 2011 2011

© Allianz SE 2011 approaches to balance sheet rehabilitation sheet balance to approaches different pursuing are economies advanced choices, five the within themes: outlook Secular With growth prospects muted … muted prospects growthWith H. Positioning our clients to benefit the from multi … in the process, look for several historical “contracts” to be revised, be revised, to “contracts” historical several look for process, in the … Financial Financial repression some in an orderly process and some in a disorderly a process and somein in orderly process an some and inflation

- speed world

Austerity

Peripheral Europe Peripheral

Restructuring

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© Allianz SE 2011 ...... a different (and better) set of challenges of set better) (and a different face economies emerging themes: outlook Secular H. Positioning our clients to benefit the from multi breakout dynamics? breakout the related and growth EM accommodate worldWill the and consumers producers between balance a better striking class and middle the empowering including transition,” income a challenging “middle Managing wealth Managing capital inflows Dealing massive with Avoiding overheating success Managing

- speed world

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© Allianz SE 2011 Yet, so far, policymakers have kicked the can(s) down the road the down the can(s) kicked have policymakers far, so Yet, solutions… structural require issues Structural H. Positioning our clients to benefit the from multi US . . . . impairments structural Four Labor markets Labor Public finances intermediation Credit Housing

- speed world Not acan, but a snowball QE2 and risks” costs balancing “benefits, andfundamentals tions Wedgevalua between and consequences Intention

–

to a solvency problem a solvency to A liquidity approach . . . .

Europe of solution of instead problem of part terms absolute and relative in dynamics andgrowth stock debt issues fundamental excessively high old debt Contagion Contagion Situation nowworse, deal with to Failure of on top Piling debt new

–

ECB nowECB

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© Allianz SE 2011 New Normal baseline, with fatter tails sides both on tails fatter with baseline, Normal New outcomes: Possible . . H. Positioning our clients to benefit the from multi Baseline: Multi Left tail (i.e., baseline not pessimistic enough) pessimistic baseline not (i.e., tail Left non unleash to true come bargains grand of three Two pessimistic) baseline too (i.e., tail scenario Right Disorderly end of the balance sheet shell game shell balance sheet the of end Disorderly - - - “ “ “ Importantly … a flatter distribution of outcomes, and withtails and … flatterofoutcomes,Importantlyfattera distribution Unleashing truth of Moment moment Sputnik and emerging economies and emerging wealthbetween income dynamics in convergence and advanced continued and inequalitywithin countries, increased for tendencies - ” speed growth in the context of multi of thecontext in growthspeed

the Chinese Chinese consumer the ” ”

- speed world

- year balance sheet reforms, balance sheet year - inflationary global global growthinflationary

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© Allianz SE 2011 the bumpy journey and the evolving destination evolving the and journey bumpythe both for investors position help wemust Implications: ...... H. Positioning our clients to benefit the from multi Getting all this right is crucial for seizing opportunities and minimizing minimizing risks and seizing opportunities crucial for is all right this Getting variables becoming parameters Several success their accommodate must world andthe well manage success, to continue must but phase, breakout in development are economies Emerging hobbling along are economies Advanced heating up are years,playfor which will issues, be in nowslipping balance sheet is and growthGlobal impaired structurally remains but cyclically recovered has economyGlobal - speed world

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© Allianz SE 2011 delivering high value to clients value high delivering for paradigm global a changing of implications Some Six illustrative principles illustrative Six H. Positioning our clients to benefit the from multi Expectation management Expectation and guidelines benchmark of including underpinnings Evolving conventional wisdom, the agility intellectual / Framework Managing the tails the Managing differentiation classes within asset Greater risks and global of opportunities changing set the Understanding

- speed world

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© Allianz SE 2011 the investment management industry management investment the for paradigm global a changing of implications Some H. Positioning our clients to benefit the from multi How do firms respond to the more fluid regulatory environment? fluid regulatory more the to respond firms Howdo just products? than solutions rather oriented clients’ to respond firms outcome Howdo to evolution clients? their for advantages mover first the whoseizes question: Key What form does industry consolidation take? consolidation industrydoes form What - speed world

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© Allianz SE 2011 on what wecontrol on what delivering to Committed control not we do what well to responding and we control what on delivering is about it PIMCO, For H. Positioning our clients to benefit the from multi . . . . . Forward Recognized thought leadership Responsive solutions and product line up First class client servicing Outstanding investment performance - looking business management

speed world

to respond well respond to committed but control Do not . . . . Market Market valuations for guarantees People are doubtful and looking Demography Asset allocation trends

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© Allianz SE 2011 Period ending May 31, 2011 (Net of Fees) benchmark. portfolio the outperformingdiscretionary assets of Percentage PIMCO performance is always a must a always is performance clients to our value sustainable long delivering is on focus PIMCO’s H. Positioning our clients to benefit the from multi ’ s investment performance: investment s 1 year1 90%

- speed world

3 year3 – 90%

superior investment investment superior

- term and and term 5 year5 92%

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© Allianz SE 2011 and market realities market and economic global of) ahead (and with in line evolve and To adapt will well, PIMCOclients our to serve continue H. Positioning our clients to benefit the from multi . . . . . Thought leadership Thought Client servicing Technologyanalytics and destination) and (journeychanges these optimize fully vehicles to of design and creation Product positioning portfolio and strategies Investment The on Bonds Authority Our heritage Our

- speed world

Your Investment Global Authority Our future Our

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© Allianz SE 2011 continue to grow our presence in non in presence our grow to continue will and platform, global a more We developed have H. Positioning our clients to benefit the from multi AuM (December 31, 2000): USD 216bn USD 216bn 2000): 31, (December AuM 94% Americas 4% Asia Pacific

Europe - speed world 2%

73% Americas 11% Asia Pacific 16% Europe AuM (May 31, 2011):31, (MayAuM USD 1,399bn -

U.S. markets U.S.

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© Allianz SE 2011 continue to do so do to continue fashion dynamic yet afocused in evolve to continued have We H. Positioning our clients to benefit the from multi AuM (December 31, 2000): USD 216bn USD 216bn 2000): 31, (December AuM In % Credit Global Long Duration Equity Non U.S. Core

- U.S. Core -

building on what we do very well, and we will we will well, and verydo we what on building

60.8 4.7 5.6 8.7 2.4 8.3

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term speed world

2.2 3.6 2.6 0.2 0.8

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H 21 10.4 1.8 0.9 0.2 7.3 1.6 1.1 3.0 3.4

© Allianz SE 2011 capital structure and across the world … world the across and structure capital the across capabilities to strengthen Continuing … to be our clients’ preferred providers of global investment solutions global clients’of investment be our to providers … preferred H. Positioning our clients to benefit the from multi

Capabilities Advisory

speed world Income Fixed

Your Investment Global Authority

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Asset Asset Allocation Solutions

Overlays

natives Alter

Equities

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© Allianz SE 2011 “One PIMCO” is a competitive differentiator is a competitive PIMCO”“One “how”: the for Now “what” the for So much . . . H. Positioning our clients to benefit the from multi Organic growth Organic culture PIMCO and strong Local presence andsolutions process Investment - - - - - can be costly, distracting, and dilutive of culture and standards of excellence of standards and culture dilutive of and distracting, be costly, can which acquisitions individual / vs. based team deliberate … and Measured leadership thought local developing our further basis, on aglobal equity brand value of enhance and Cultivate worldthe ensure to culture, our in consistency while maintaining local ourresources in invest to Continue up insights and bottom welldown Combine top opportunity investment and growthglobal of economic nature transitioning the reflect to process, investment our of features and enhance evolve to Continue

“ One PIMCO One - speed world

”

throughout our offices around offices our throughout

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© Allianz SE 2011 Reflecting all this in responsive facts on the ground the on facts in responsive all this Reflecting H. Positioning our clients to benefit the from multi Working with and AZ Life space recognized all leader retirementbecome a AZ to in globalization continuing our and platform NY management portfolio Equities ETFs Advisory Tail hedging Solutions PIMCO Investments PIMCO

- speed world

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© Allianz SE 2011 Managing the transformation: challenges and risks andrisks challenges transformation: the Managing H. Positioning our clients to benefit the from multi management Talent Governance Reputation Culture Resilience

skills, skills, diversity and orderly transition We must maintain our efforts, emphasizing forward We must continue to evolveour internal governance valuable asset, and must protect it at all cost We have built our brand into an incredibly success as wegrow across regions and capabilities We must maintain and enhance the key elements of our investment opportunities, economic developments, and regulation on our ability to anticipate and adapt to evolving client needs, We are operating in an environment of change; our success depends - speed world

- looking

wemust remain “constructively paranoid”

In sum

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© Allianz SE 2011 enable PIMCO’s long PIMCO’s enable to help managers, of senior group a broader to develop continued we have succession: and management Talent . . . H. Positioning our clients to benefit the from multi 1) Denotes numbers of years as an MD of the firm; MDshownfirm; asnumbers yearsan of Denotes as 2011 the of The current group of MDs has an average of 20 years of investment experience - - - - Since 2006: contributions of a broader group of individuals The pool of MDs has been refreshed and expanded to recognize the experience and have hired MDs from the outside 14 MDs have retired or left the firm 30 newMDs havebeen appointed the total number of MDs has increased from 28 to 44 (+57%) MD tenure profile tenure MD 0 5 10+ years - - 4 years 9 years

1 22% 22% : 2006 : (6) (6) -

term success term - speed world

57% - of May31st of

(16)

MD tenure profile tenure MD 0 5 10+ years - - 4 years 9 years

11% 1 : 2011: 25% (5)

(11)

64% (28) H 26

© Allianz SE 2011 best days are still ofus ahead still daysare best PIMCO’s success, historical our on Building . . . . . H. Positioning our clients to benefit the from multi Responding to our clients’ evolution from products to solutions to products clients’ Responding ourevolution fromto PIMCO driven have that values Living the Deepening and broadening our successful DeepeningAllianz withinbroadeningsuccessful interactions our the and Group success business future of enablers in investments targeted Building making byresilience value the throughout leadership and thought quality Applying PIMCO ------to to “our clients provider of global investment solutions” Completing our multi Technology analytics& Human capital Integrity, always Professional discipline drives us People are our most valuable asset Clients come first - added chain

- year evolution from “just bonds” to “more than bonds”

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’ s success for 40 years 40 for success s

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© Allianz SE 2011 of partnership with of partnership Allianz years great eleven extending and Reinforcing H. Positioning our clients to benefit the from multi … and therefore thrive as acompany as thrive and therefore … … stakeholders and shareholders, well clients, our serve ability to PIMCO, supporting enabling Byand our to instrumental Allianz been has Allianz Group is committed to… committed is Allianz Group of the member anintegral as PIMCO Looking forward, ...... clients, and other stakeholders and other clients, shareholders, value growingto and deliver large to continue thus, And initiatives Group strategic and other leadership in thought assist to continuing … … income andnet earnings in operating deliver solid growthto continuing … retirement) (e.g., initiatives fertilization cross profitable withadvancing … us to entrusted assets well Group manage to continuing … line business Management Asset Group’s enhance the to continuing … sources of earnings for the Group the for earnings of sources other with correlated andlowlystable, relatively relativelyhigh, is that - speed world

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© Allianz SE 2011 in an evolving world evolving an in clients our of needs the adapt and toanticipate ability our on depends success continued our In conclusion, H. Positioning our clients to benefit the from multi in the midst of a consequential paradigm change We must position PIMCO to continue to serve wellclients’ needs versatility and innovation, absorption and agility, defense and offense We willmaintain and enhance keyelements of our historic success: If If we succeed, and we fullyintend to, PIMCO’s best days are ahead of us The ability to understand, anticipate, respond and adapt is key and global re Economies and markets are in the midst of consequential national choice choice in the global investment management industry, today and tomorrow with Allianz Together withcontinued strong support from – -

alignments we willcontinue to position PIMCO as our clients’ provider of

- speed world

–

and expanding collaboration

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© Allianz SE 2011 change withoutnotice. change (described in PIMCO's form ADV, part II) commissions, other expenses, and the deduction of actual investment (describedadvisoryinvestment b PIMCO'sactual in of fees; deduction form II) commissions, the ADV, partand expenses, other Pastindicatorperformance not reliable is ofor guaranteea afuture results All All investments contain risk may andlosevalue.This material containscurrent such theandmanagertheofopinions opinions a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained f obtained beenhasherein particular any security, of recommendation strategyaorproduct.Information contained investment believed to be reliable, but not guaranteed. No part of this material may be reproduced in any form, form, Nootthis material anyorpartanyin of reproducedreferredin to may be guaranteed. not but be reliable, to believed the deduction of custodial custodial fees. of deductionthe

This material has been distributed for informational purposes only and should not be considered as as consideredinvesbenot should and onlyinformational distributedforThis purposes material beenhas

The "net of fees" performance figures above also reflect reflect reinvestment earnings.thealso of performanceabovefigures fees" of The"net without express written permission. withoutexpresswrittenpermission. PIMCO. ©2011,

. Performance figures are presented net of management fees fees management of netPerformance arefigures presented .

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© Allianz SE 2011 Disclaimer convergence levels exchange levels, expenses, including credit including core conditions, from statements “potential”, “plans”, looking implied performance and on expectations The Cautionary These assessments are, as always, subject to the disclaimer provided below.

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