In the face of intensifying geopolitical developments and their economic implications, Allianz Group CEO Oliver Bäte said the firm has been “carefully and thoughtfully” optimising its diversification, an approach that, he added, has long been central to its business model.
“One of the things in our business model, even though we measure short term, is to try to look through the noise and focus on the signal,” Bäte told a CNBC panel ahead of the 2026 World Economic Forum Annual Meeting in Davos, Switzerland.
According to the CEO, economic risk has been building for a long time, raising the question of why it has not yet been fully reflected in market prices.
“That’s what concerns us. But the most important question for us is: how do we keep our customers safe? I keep saying that, and it really matters.
“So we have been de-risking. When people said, ‘Yeah, but you lost a lot of money last year on the US dollar,’ we said, ‘No, we didn’t,’ because we’ve been hedging our net cash flow in US dollars forward for a long time. That’s what we do.”
Discussing the renewed focus on tariffs, Bäte said there was “absolutely” a risk to be managed, but noted that tariffs are ultimately a tool used by politicians seeking to achieve a particular outcome.
Recent headlines have underlined that point. US President Donald Trump has suggested that acquiring Greenland is imperative for national and global security.
He has said he would impose a 10% tariff “on any and all goods” sent from the UK to the US from 1 February, rising to 25% from 1 June, unless Washington reaches a deal to purchase Greenland from Denmark.
He added the same measures would apply to goods from Denmark, Norway, Sweden, France, Germany, the Netherlands and Finland.
“If you go back many, many years and ask, ‘What’s the art of the deal?’ you can read the scripts—they’re right there. That doesn’t mean it’s not dangerous. But again, we need to ask: what’s the noise, what’s the signal?” Bäte stated.
Expanding on the company’s approach to de-risking well ahead of recent events and the question of reducing US assets on its balance sheet, the CEO said. “No. We’ve been preparing—we’ve been preparing.
“We discussed the US dollar previously. Europe holds a particularly large exposure to it, and it’s important for the US government to consider what it means if confidence in these assets erodes. We’ve been monitoring that closely. At the same time, we’ve been carefully and thoughtfully optimising diversification, that’s the key point.”
The panel wrapped up the discussion on diversification and risk assessment, including whether Allianz anticipates further weakness in US assets.
Bäte concluded, “It depends on what happens over the next few months. The biggest risk would be a loss of fundamental trust in the future of the US financial system. We don’t see that risk materialising. I’m an optimist, but a cautious one, so call me a careful optimist.”
