ALLIANZ GROUP 58 SOUTH AMERICA _  In South America, we have a presence in Argentina, Brazil, Chile, Columbia and Venezuela. _  Total premium income from the region came to 614 (768) million euros in 2003. South America Gross premiums by country 2003 2002 2001 ¤ mn ¤ mn ¤ mn Brazil 270 336 355 Colombia 164 222 267 Venezuela 84 106 126 Chile 53 61 76 Argentina 43 43 138 Total 614 768 962 Total premiums earned (net) 408 494 610 Total earnings after taxes 12.8 46.8 29.1 The countries of Latin America have repeatedly suffered from economic crises and currency problems in the recent past. This difficult market context is also reflected in the combined ratio of our insurance portfolio in the region, despite an improvement of the expense ratio, which increased to 103.9 (101.8) percent. Except for Chile, all companies posted an after-tax profit. Total earnings after taxes came to 13 (47) million euros.  In the  current fiscal year , Argentina and Brazil showed the first signs of an economic recovery, but it is very difficult to predict the further course of events at this time. Venezuela is in the grip of political instability that could aggravate the economic situa- tion further. Columbia, on the other hand, managed to enter a stabilization phase. We have introduced measures designed to reduce our risk in this region and will closely follow further developments. Adjusted for currency effects,  premium income in the region grew 7 percent. The biggest contribution to premium income came with 270 million euros from Brazil. Second was our com- pany in Columbia, which posted a premium income of 164 mil- lion euros. _  Allianz Global Risks Rückversicherungs-AG (AGR Re) handles all business with our major international clients. _  Gross premium income increased to 1.3 (1.1) billion euros.  The 18.4 percent  growth in revenues is primarily attributable  to rate increases. With a share of 66 percent property insurance contributed the largest portion to the revenues and grew by  7.3 percent. Allianz Global Risks is a virtual business unit which, in ad- dition to the reinsurance activities of AGR Re, also includes the worldwide industrial clients business of Allianz Group. We were able to lower its combined ratio to 93.8 (126.3) percent.  ALLIANZ GLOBAL RISKS RÜCKVERSICHERUNGS-AG  Allianz Global Risks Rückversicherungs-AG returned to prof- itability in the reporting year and posted  earnings after taxes of 77 million euros, compared to a loss of 256.7 million euros in the previous year.  The  claims ratio improved to 70.9 (100.8) percent. A selective underwriting policy and additional portfolio restructuring meas- ures decreased the claims frequency. Lower claims expenses for elementary losses also helped to bring down the claims ratio. The further optimization of our reinsurance program permitted a substantial reduction of expenses for passive reinsurance. The expense ratio , which had been driven up by the high expenses of building up business, noticeably improved in the year under review from 41.7 percent to 27.9 percent. This resulted in a combined ratio of 98.8 (142.5) percent.