The COVID-19 induced turmoil in the financial markets and a slowing economy have clearly aggravated business conditions for the financial services industry. However, Allianz with its well-diversified business portfolio and a robust balance sheet is well prepared to manage the Corona crisis and has achieved good results in the first quarter of 2020.
Internal revenue growth, which adjusts for currency and consolidation effects, amounted to 3.7 percent, driven in particular by our Life/Health business segment but also supported by our other business segments. Total revenues increased 5.7 percent to 42.6 (1Q 2019: 40.3) billion euros. Operating profit declined 22.2 percent to 2.3 (3.0) billion euros. Our Asset Management business segment reported a strong increase in operating profit due to a rise in assets under management driven revenues. Our Property-Casualty business segment saw a decrease of the operating profit due to higher claims from natural catastrophes, as well as COVID-19-related losses. Operating profit from our Life/Health business segment also declined mainly driven by the market downturn, which impacted the investment margin and deferred acquisition costs. Net income attributable to shareholders decreased 28.9 percent to 1.4 (2.0) billion euros mostly driven by the lower operating profit. The non-operating result also worsened as realized gains from the sale of Allianz Popular were more than offset by COVID-19-related market impacts. A lower tax rate had a partly offsetting effect.
Basic Earnings per Share (EPS) decreased 27.8 percent to 3.36 (4.65) euros. Annualized Return on Equity (RoE) amounted to 9.3 percent (full year 2019: 13.6 percent). The Solvency II capitalization ratio was at 190 percent at the end of the first quarter of 2020, compared to 212 percent at year-end 2019.
In light of the uncertainties for the macroeconomic development caused by the current pandemic and the now available updated financial plans of the operating entities of the Group, as already announced in the media release from April 30, 2020 the Board of Management does not assume that Allianz Group can achieve the target range for the operating profit for 2020 in the amount of 12 billion euros, plus or minus 500 million euros. A new profit target for 2020 will be announced by the Board of Management upon completion of the revised planning once the impact of the Corona crisis can be better assessed.
"The first quarter of 2020 showed the resilience of Allianz in these unprecedented circumstances," said Oliver Bäte, Chief Executive Officer of Allianz SE. "I am very proud of the operational preparedness of Allianz, the dedication of our employees and our IT that ensures the highest service levels for our customers even in this challenging situation. These are very testing times for us all, but I believe that together we will rise to this challenge."