German insurer Allianz has announced it will close its own bank because of a difficult business environment. The move is expected to cost hundreds of jobs nationwide and end one of the company's failed experiments.
Insurance giant Allianz of Germany announced on Thursday it would close down its own banking subsidiary, Allianz Bank, by June 30, 2013.
The insurer had hoped to make profit out of selling banking products with the help of its own distribution network, but hadn't been able to push its banking subsidiary into positive territory.
"Our growth expectations have not been met and our banking operations have remained unprofitable," Allianz said in a statement. "A sustainable reversal of the trend is not in sight, given the continuously difficult market environment," CEO Andre Moschner added.
Jobs at stake
The company said 450 jobs would have to be slashed nationwide as a result of closure. Long-term financial products would not be discontinued, though.
But the 325,000 or so current account owners would have to look for alternatives as the Allianz Bank's deposit, debit card and loan business would be stopped in summer.
The insurer said since its founding four years ago, the bank had cost the company some 400 million euros ($534 million). It's been Allianz's second unsuccessful foray into banking. As the former owner of Dresdner Bank, it lost several billion euros before the lender was acquired by Commerzbank.
hg/dr (Reuters, dpad, dpa)