“Der Standard” Generali Group CEO Philippe Donnet Interview

Generali has Austria in its DNA

Philippe Donnet, CEO of the Generali Group, talks about growth plans in Eastern Europe, the new main pillars of the company and the importance of historic real estate in Vienna.

Standard: Generali’s portfolio contains Italian bonds worth 60 billion Euro. Is this a cause for concern considering the political instability in Italy and the increased spread between German and Italian government bonds?

Donnet: No. We have slightly reduced our Italian bond holding on the one hand; on the other hand, I do not foresee any big problems in the country. Taking into account the many small and medium-sized enterprises that have strong exports, Italy has an important industrial backbone. Moreover, the families’ saving capacity is higher than in other countries, and the Italian trade balance remains positive.

Standard: Italy is the most important market for Generali with ten million customers. Will this continue?

Donnet: We want to grow in Italy as well; however, we aim for greater growth abroad.

Standard: Which countries do you refer to?

Donnet: Our focus is on Central and Eastern Europe. We have plans for acquisitions there if the right opportunity comes along. Only recently, we have invested in Poland and Slovenia. However, we also aim to grow in South America and Asia as well.

Standard: What significance has the Eastern and Central European market had for Generali up until now?

Donnet: We have more than twelve million customers in this region. The market makes up about 10% of our premium income and 15% of our operating result.

Standard: What about Russia?

Donnet: The Russian market is underpenetrated and therefore offers potential for growth. We have, for example, a share of 38.5 % of the Russian insurer Ingosstrakh, and we have recently opened an office in Moscow.

Standard: Rumor has it that Generali wants to sell real estate in Vienna or perhaps also in Prague.

Donnet: We are very proud of our historic property in Vienna. It is part of Generali’s DNA. After all, Austria was the first market for Generali after being founded in 1831 in Trieste. In any case, we are not planning any real estate sales.

Standard: The new strategy 2019 to 2021 includes new areas of business in addition to geographic expansion. What can we expect?

Donnet: In the future, we will not only focus on insurance but also on asset management. Asset management will become the third main pillar of our company. I expect annual growth rates of up to 20%. Here, too, acquisitions play a key role. For this reason, for example, Generali has bought the asset management company CM Investment Solutions from Bank of America Merrill Lynch. Moreover, we want to invest one billion Euro in digitalization and innovation by 2021.

Standard: Do you expect a consolidation process in the insurance industry similar to banks?

Donnet: No, they are two different sectors. Developments in the banking sector will not have significant influence on the evolution of the insurance industry.

Philippe Donnet has been Chief Executive Officer of Generali Group since 2016. The 59-year-old Frenchman previously worked with AXA and Vivendi, among others.

(Source: Der Standard, page 17, 12.02.2019)