Asset allocation

Asset allocation

At 31 December 2016, total investments amounted to € 474,069 million, up by 4.7% over the previous year.

Group investments amounted to € 395,752 milion (+4.8%) and unit/index linked investments amounted to € 78,317 million (+4.5%).

With respect to the ratio of the main investment categories, the relative exposure of the fixed income instruments was up to 88.1% (87% at 31 December 2015). The ratio of investment properties is stable at 3.7% (3.7% at 31 December 2015), while the incidence of the equity instruments declined to 4.5% (4.9% at 31 December 2015) and that of other investments remained substantially stable, at 0.9% (0.9% at 31 December 2015). Other investments mainly include receivables from banks or banking customers, equity investments and derivatives. Lastly, the liquidity ratio decreased from 3.7% to 2.8% due to the planned gradual reinvestment of liquidity.


Sustainability Report 2016, p. 36 for further information on Group responsible investments

Fixed income securities: bond portfolio

With reference to the bond portfolio, government bonds which represent 54.9% (54.9% at 31 December 2015) were up, standing at € 174,364 million (€ 163,474 million at 31 December 2015). The change during the period was due primarily to the acquisitions made in 2016. The exposure to individual government bonds is mainly allocated to the respective countries of operation, in line with the Group’s ALM policy.

The corporate component increased in absolute terms to € 143,063 million (€ 134,077 million at 31 December 2015), equal to 45.1% of the bond portfolio (45.1% al 31 December 2015). The change is due to the net purchases made during the year, as well as the increase in value resulting from the decrease in the credit spread. The corporate component includes guaranteed bank corporate bonds, financial sector bonds and bonds issued by industrial companies. With reference to the new investments those in the non-financial sector were preferred in order to increase diversification. The decrease of Covered bonds was mainly due to maturities not replaced by new acquisitions, also due to a lack of new issuances for this kind of instruments.

A breakdown by credit rating of the bond portfolio at 31 December 2016 split between corporate and government bonds follows.


Rating changes in comparison with previous period reflect net sales as well as market movements; moreover further variations in some rating classes – mainly AAA – are due to a changed methodology in the rating attribution process, which foresees the use of internal rating when lower than the external one.

Equity securities: share portfolio

Equity securities: share portfolioEquity securities decreased in absolute terms, standing at € 17,701 million (€ 18,353 million at 31 December 2015).

The change during the period is partially due to the sales made in the year and partially to the rotation of the portfolio, aimed at reducing of equity risk against negative performances of the market at the beginning of the period.

In this context the exposure to financial securities - more volatile - decreased, and priority was given to countries and sectors with a more promising economic outlook.

Investment properties

Investment properties

Investment properties in terms of book value amounted to € 14,489 million (€ 13,783 million as at 31 December 2015).

In particular, the direct investment properties of the Group, at market value, amounted to € 18,522 million (€ 17,385 million as at 31 December 2015), and are almost all in Western Europe, mainly in Italy, France and Germany. The properties are mainly located in their respective countries of operation.

Investment result4

Return on investiment

Economic components    
Current income from fixed income instruments 10,737 10,880
Current income from equity instruements 704 583
Current income from real estate investments(*) 775 826
Net realized gains 2,167 3,212
Net impairment losses -1,134 -737
Net unrealized gains -382 -784
Average stock 395,343 373,097
Current return(*) 3.2% 3.4%
Harvesing rate 0.2% 0.5%
P&L return 3.3% 4.0%

(*) Net of depreciation of the period.

The current return recorded a modest decline, standing at 3.2% (3.4% at 31 December 2015), with a slight decrease in absolute terms in current income, amounting to € 12,469 million (€ 12.552 million at 31 December 2015).

The reduction in the ratio is partly due to the significant increase in average investments, and also to the low interest rates that can be obtained when reinvesting.

The contribution to the result for the period from realized gains and losses through profit or loss (harvesting rate) experienced a reduction to 0.2% (0.5% at 31 December 2015) mainly due to a decline in realized gains both in the life segment and in the property&casualty segment, in particular on equity securities and investment properties, aimed at preserving future return of portfolio in a context of ongoing low interest rates, and to an increase of impairment losses, mainly on the equities side, due to the negative trend of the markets.

4 Please refer to the methodological notes attached to this report for details on the calculation of this indicator.