Euler Hermes

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Euler Hermes
Type Société Anonyme (EuronextELE.PA)
Founded 2002 (group), 1917 (Hermes), 1893 (ACI)
Headquarters Tour First 1, place des Saisons - 92048 La Défense Paris, France
Key people Clement Booth, chairman of Euler Hermes Supervisory Board (since Jan. 01, 2010); Wilfried Verstraete, chairman of Euler Hermes Board of Management (since April, 2010)
Products Credit insurance, Reinsurance, Trade debt collection, Bonding
Revenue € 2,486 million (2013)[1]
Operating income € 458,6 million (2013)[1]
Net income € 313,7 million (2013)[1]
Total assets € 6,062,656 (2013)[1]
Total equity € 2,461,870 (2013)[1]
Employees 6,140 (2013)[1]
Parent Allianz
Divisions Euler Hermes Americas; Euler Hermes Asia-Pacific; Euler Hermes Germany-Austria-Switzerland; Euler Hermes France; Euler Hermes Mediaterranean countries, Africa and Middle-East; Euler Hermes Northern Europe; Euler Hermes World Agency; Solunion
Website http://www.eulerhermes.com

Euler Hermes is the largest global credit insurance company in the world that offers a large range of bonding, guarantees and collections services for the management of business-to-business trade receivables. It is also one of the oldest credit insurance company in the world, with the history spanning back to 1893. Its credit intelligence network analyzes the financial stability of 40+ million businesses worldwide.

Euler Hermes products and services help manage the payment default risks - the risk that a buyer fails to pay for the products of services it buys on trade credit terms. These products include Trade Credit Insurance, Bonding, Instalment Credit Protection, Reinsurance Business and Collections

A subsidiary of Allianz SE, Euler Hermes is listed on ELE.PA and is rated AA- by Standard & Poor's.[2] The Group posted a consolidated turnover of €2.5 billion in 2013.[3] Euler Hermes employs 6,000+ employees in over 50 countries and insured global business transactions for €789 billion in exposure at the end of 2013.[4]

History[edit]

With a history dating back over 100 years, Euler Hermes has grown both organically and through acquisitions. Today it ranks as the leading credit insurer worldwide, present in over 50 countries. Today’s Euler Hermes group grew out of Euler SFAC in France and Hermes Kreditversicherungs-AG in Germany.

  • Hermes Kreditversicherungsbank-AG (Hermes) was founded in 1917 by two members: Münchner Rückversicherungs-Gesellschaft and Globus Versicherungs-AG
  • In 1949, it began underwriting export credit transactions in the Federal Republic of Germany, in cooperation with Deutsche Revisions-und Treuhand AG. SFAC was founded in 1927 by several major insurance companies, including Assurances Générales (the predecessors of Assurances Générales de France (AGF)) and Compagnie Suisse de Réassurance.
  • In the 1990s both SFAC and Hermes embarked on a program of international expansion, acquiring credit insurers and creating new subsidiaries.
  • In 1996 AGF became SFAC’s majority shareholder. SFAC changed its name to Euler. The same year, Allianz took control of Hermes.
  • In 1998 Allianz acquired a majority interest in AGF’s capital.
  • In 1999 Euler and Hermes signed a cooperation agreement with a view to coordinating their international expansion.
  • On April 27, 2000 Euler was listed on the Premier Marché of Euronext Paris.
  • In September 2001 Allianz group and AGF announced their intention to merge their respective credit insurance subsidiaries through the acquisition of Hermes by Euler.
  • In July 2002 the Euler group finalized the acquisition of Hermes.
  • In 2003 the Group and its subsidiaries adopted the brand name Euler Hermes.
  • From 2004 the Group continued its international development.
  • In 2010 Euler Hermes launched the “Excellence” initiative and changed its governance to strengthen the Company’s customer centricity and international integration.
  • In 2011 the legal restructuring project “Blue Europe” merged 12 separate Euler Hermes units under the single Brussels-based insurance carrier Euler Hermes Europe. A memorandum of understanding was signed with MAPFRE to create a Spain and Latin America strategic alliance: Euler Hermes to combine credit risk underwriting expertise with MAPFRE distribution and sales strength.
  • In 2012 Euler Hermes and MAPFRE committed to launch the Solunion joint venture in Spain and Latin America in 2013. An Excess of Loss (XoL) policy launch completed the Euler Hermes product range. 2013 saw the official launch of Solunion, the joint venture between Euler Hermes and MAPFRE. In 2014, Euler Hermes also increased its equity interest in ICIC, the Israeli credit insurance specialist, to 50%. Euler Hermes also forged an innovative global distribution partnership in credit insurance with HSBC. Euler Hermes’ expertise was rewarded by industry awards around the world.

Operation[edit]

Euler Hermes provides guarantees or insurance on accounts receivable arising from the sales of commercial goods and services on credit terms of 30-day and 60-day time scales especially for export companies (as an alternative to making the foreign purchaser obtain a letter of credit), sometimes on longer time scales; it manages guarantees for exports by corporations globally; and also provides other international support for exporters. It distributes its products and services through a network of direct agents, brokers, and banks and tracks companies in markets representing 92% of the world’s GDP.[5]

Euler Hermes in Germany[edit]

Main article: Hermes cover

Euler Hermes manage the official export credit guarantee scheme on behalf and for account of the German Federal Government. Decisions on matters of principle and the underwriting of large export transactions are made by an inter-ministerial committee comprising representatives not only of the German Federal Ministry of Economics and Technology but also of the Federal Ministry of Finance, the German Foreign Office and the Federal Ministry for Economic Cooperation and Development. Euler Hermes acts as leading partner in this consortium, which explains why these guarantees are widely known as Hermes cover in the business world. These guarantees enable exporters to cover themselves against economic risks (customer risks) and political risks (country risks). The federal guarantee is necessary because it is not possible to obtain adequate cover from private insurers, particularly against political risks for exports to non-OECD countries.

Euler Hermes in North America[edit]

Euler Hermes North America, the North American subsidiary of Euler Hermes was incorporated in 1893. It is the oldest and largest insurance carrier in North America exclusively writing receivables insurance and providing risk mitigation services. It is headquartered in Owings Mills, Maryland. Euler Hermes North America provides trade credit insurance policies covering both domestic and export trade in more than 200 countries.

One of the main spokespersons for Euler Hermes North America is Chief Economist Dan North, who after having predicted the 2008/2009 recession and its implications accurately, was ranked 4th on Bloomberg’s list of the 65 top economic forecasters in 2010 .

Euler Hermes worldwide[edit]

The Group’s economic organization is based on six geographic regions: Germany, Austria and Switzerland; France; Northern Europe; Mediterranean countries, Middle East and Africa; Americas and Asia Pacific. The Group is present throughout the world via insurance companies, service companies and/or branches. Additionally, The company form relations with other shareholders within the Moroccan subsidiary Euler Hermes Acmar (55%), the Austrian companies Prisma Kreditversicherungs-A.G, and OeKB EH Beteiligungs-u. Management (both 49% owned), Israël Credit Insurance Company Ltd (ICIC – 50%), the Portuguese company Companhia de Seguro de Credito SA (COSEC – 50%), and Solunion (50% owned).

Global network[edit]

The company has 54 subsidiaries throughout Europe, in France, Italy, Belgium, United Kingdom but also in the United States and Canada, including regional service hubs in New York City, Chicago, Atlanta, Los Angeles, Houston, Toronto and Montreal. It employs approximately 6,000 around the world, and insures over $789 billion in commercial transactions.

Euler Hermes covers global risk management on six continents, with risk and information specialists located in 54 countries. Euler Hermes has a database with proprietary information on more than 40 million companies worldwide, and provides coverage on shipments to 200 countries around the globe.

Economic Research[edit]

Euler Hermes economic team analyzes sector-specific, country-related and global economic trends producing several publications that are a valuable extension of the research and analysis performed by experienced economic team. These publications cover the world trade environment through innovative macro-economic and country risk research, top-notch analysis of industry risks worldwide and exclusive business insolvency forecasts. The company also publishes insolvency outlook and rating per country.

Awards[edit]

  • Best Trade Credit Insurance Brand in Middle East 2013 awarded by GLOBAL BRANDS MAGAZINE[6]
  • Best Private Insurer in Trade and Best Global Export Credit Agency 2013 voted by the industry at TRADE FINANCE AWARDS[7]
  • Best trade credit insurer 2013 awarded by GLOBAL FINANCE[8]

Financial information[edit]

(in €thousand) 2009 2010 2011 IAS 19 proforma 2012 IAS 19 proforma 2013
Revenue 2,085,711 2,147,734 2,274,922 2,397,896 2,486,240
Operating income 74,771 388,930 466,373 431,835 458,606
Net income 18,988 294,452 332,193 305,500 313,729
Net combined ratio 104.7% 68.7% 69.8% 74.6% 75.3%
Total Equity 1,795,779 2,130,421 2,218,349 2,345,241 2,461,870

Corporate Governance[edit]

Euler Hermes is a limited Company with a Board of Management and a Supervisory Board.[9]

Board of Management[edit]

  • Wilfried Verstraete, Chairman. In charge of coordinating the work of the members of the Board of Management, steering and coordinating the activities of all the Group’s companies, and representing the Company towards third parties. He also supervises the Group’s Internal Audit, Human Resources and Communication functions.
  • Gerd-Uwe Baden, Member of the Board of Management in charge of Business Development and Partnerships.
  • Frédéric Bizière, Member of the Board of Management in charge of Risks, Information and Claims functions and Reinsurance.
  • Clarisse Kopff, Group Chief Financial Officer and Member of the Board of Management in charge of Group Asset Management, Compliance, Finance, Legal, M&A, Tax and Risk and Capital Management.
  • Dirk Oevermann, Member of the Board of Management in charge of Operations, including supervision of the Group IT function.
  • Paul Overeem, Member of the Board of Management in charge of Market Management, Commercial and Distribution.

Supervisory Board[edit]

  • Clement B. Booth, Chairman, Member of the Allianz SE Board of Management responsible for the global insurance lines and the regions UK, Ireland and Australia.
  • Brigitte Bovermann, Vice-Chairwoman and Member of the Nomination and Remuneration Committee and of the Audit and Risk Committee. Head of Business Division « Global Insurance Lines & Anglo Markets » of Allianz SE
  • Ümit Boyner, Independent Member, Executive Board member at Boyner Holding A.S
  • Philippe Carli, Independent Member and Chairman of the Audit and Risk Committee, General Manager Groupe Amaury
  • Elisabeth Corley, Member, Chief Executive Officer of Allianz Global Investors
  • Nicolas Dufourcq, Independent Member, Chief Executive Officer of Banque Publique d'Investissement (BPI)
  • Robert Hudry, Member of the Audit and Risk Committee, Company Director
  • Jean-Hervé Lorenzi, Independent Member and Member of the Nomination and Remuneration Committee, Advisor to the Board of the Compagnie Edmond de Rothschild
  • Yves Mansion, Member of the Audit and Risk Committee, Company Director
  • Thomas-Bernd Quaas, Independent Member and Chairman of the Nomination and Remuneration Committee, Member of the Supervisory Board of Beiersdorf
  • Jacques Richier, Member, CEO of Allianz France

See also[edit]

Hermes cover, the German export credit guarantee scheme managed by Euler Hermes Kreditversicherungs-AG and PricewaterhouseCoopers Aktiengesellschaft

References[edit]

External links[edit]