MUNICH - Allianz AG's top executive, who has overseen 50 acquisitions to build Europe's biggest insurer, is resigning amid the record losses and stock plunge blamed on his biggest deal - last year's purchase of Dresdner Bank.
Henning Schulte-Noelle will leave in April after 11 years as the top executive, the company announced Wednesday. He will be succeeded by Michael Diekmann, 47, who sits on Allianz's management board and oversees the company's U.S. insurance business.
Investors have criticized Mr. Schulte-Noelle, 60, since the $20 billion Dresdner takeover left Allianz with mounting bad loans and the unprofitable Dresdner Kleinwort Wasserstein investment banking firm, where he has had to cut costs. He has also had to work to keep Dresdner's top bankers from leaving.
Allianz spent $637 million last year on an overhaul that included firing 8,000 employees, including Bruce Wasserstein, who sold his boutique to Dresdner for $1.56 billion in 2000. Germany's third-largest bank, Dresdner lost $999 million in the third quarter and helped Allianz post record quarterly losses of $2.6 billion. Provisions for bad loans climbed to $1.8 billion.
Mr. Schulte-Noelle is among Germany's most powerful executives; he sits on the boards of companies ranging from Siemens AG to Munich Re. However, investors have been losing confidence in his ability to revive Allianz, according to a survey published in September by Germany's Manager Magazine. Only 48% of those surveyed said they thought Mr. Schulte-Noelle could boost Allianz shares, compared with 58% in a June poll. Allianz shares have dropped 61% this year.
The Dresdner acquisition was supposed to be the crowning achievement of Mr. Schulte-Noelle's 26-year career at Allianz, during which he turned the 112-year-old casualty insurer into a global financial services provider with 150,000 employees in 70 countries.
He has been an active acquirer on this side of the Atlantic, buying two U.S. fund managers, Pimco Advisors Holdings LP in 1999 and Nicholas-Applegate Capital Management LP in 2000, for more than a combined $2.4 billion as prices were peaking. Allianz also owns Fireman's Fund Insurance Co., where reserves for asbestos-related claims have doubled this year, to $1.5 billion.
Mr. Schulte-Noelle is the latest top European executive to fall victim to widening losses. Lukas Muehlemann was replaced in September as the top executive of Credit Suisse Group, Switzerland's No. 2 banking company.
Investors on Wednesday were supportive of Mr. Schulte-Noelle's successor. Mr. Diekmann "wasn't the inventor of the Dresdner deal, and he has to make the best of it, which Mr. Schulte-Noelle couldn't do," said Juergen Lukasser, who helps manage $5.1 billion at the Vienna-based Constantia Privatbank AG and holds Allianz shares.
Since joining the company in 1988 as an assistant to the head of the Hamburg regional office, Mr. Diekmann has moved up the ranks at Allianz. He was eventually put in charge of operations in Central and Eastern Europe, the Middle East, Africa, and group management development in 2000. This year he was given responsibility for the North and South American businesses, including Fireman's.
