© Reuters.
By Geoffrey Smith
Investing.com — Allianz (ETR:) stock rose in early trading in Frankfurt on Wednesday after booking another 1.9 billion euro charge against its imploded Structured Alpha hedge fund, hoping to draw a line under an episode that has been deeply embarrassing for the insurance and asset management giant.
Allianz said it “believes that this provision booked is a fair estimate of its remaining financial exposure in relation to compensation payments to investors and to payments under any resolution of the governmental proceedings.”
After taxes, it expects the charge to take 1.6 billion euros off the group’s net profit for the quarter when it publishes its first quarter results on Thursday.
Allianz stock rose 2.5% by 4:10 AM ET (0810 GMT) in response to the announcement, outperforming the German , which was up only 0.6%.
The Structured Alpha fund had collapsed last year, leading to an investigation by U.S. authorities and numerous claims for compensation from its investors. Allianz had initially taken a charge of 3.7 billion euros ($3.9 billion) to cover the costs.
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