Henning Schulte-Noelle, the chief executive of Allianz, Europe's largest insurer, yesterday resigned after a disastrous year for the company following the acquisition of Dresdner Bank.
Mr Schulte-Noelle, 60, will step down in April, when he will be replaced by Michael Diekmann, 47, who currently heads the group's insurance business in the Americas and the group's human resources.
Mr Schulte-Noelle, who has worked for Allianz for 26 years, masterminded the €24bn (£15bn) acquisition of Dresdner last year. But bad loans and unprofitable business at the investment bank caused the Allianz group to post a record pre-tax loss of €2.5bn for the third quarter. Mr Schulte-Noelle yesterday said his reasons for stepping down were personal.
Allianz has also suffered from the downturn affecting many European insurers, taking heavy losses on the floods that swept across Germany and Poland this summer, while its exposure to tumbling equity markets have eroded its capital reserves.
While many analysts responded positively to the end of Mr Schulte-Noelle's reign, his successor's lack of experience in banking is causing concern. Mr Diekmann has vowed to make Dresdner profitable by 2003.
Shares in Allianz closed down 3.2 per cent at €101.60 in Frankfurt yesterday.
"He deserved to go," one analyst said. "But once they have stripped down Dresdner to the bare bones, they won't get much revenue out of it. So it's hard to see when they are ever going to be able to make it profitable."