Dresdner Bank Loss Spoils Allianz's Earnings Party

Dresdner Bank posted a 453 million euro ($694.4 million) operating loss in the first quarter after writing 845 million euros off the value of structured finance products, marring gains from property and casualty insurance at parent Allianz.

Dresdner's operating loss was worse than the 398 million euro average loss expected in a Reuters poll of 11 analysts.

Europe's biggest insurer on Friday gave details of its first quarter results after announcing key figures late last month.

Group quarterly operating profit fell 35 percent to 1.856 billion euros from 2.870 billion euros a year earlier, while net profit declined to 1.148 billion euros from 3.240 billion in the first quarter of 2007, which had been flattered by investment gains.

Dresdner said in March it would split itself in two -- a retail bank and investment bank, Dresdner Kleinwort -- to play a more active role in industry consolidation.

Speculation that the Dresdner parts could be sold or merged has since periodically boosted Allianz's share price.

Allianz bought Dresdner in 2001 in a 24 billion euro deal a shareholder once described as the biggest disaster in German industrial history.

Dresdner racked up losses of almost 3 billion euros after the merger that Allianz struggled to put right.

Allianz shares have fallen nearly 12 percent since the start of the year, lagging a 9 percent drop in the DJ Stoxx index of European insurers.

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