8.3. Capital management
Capital management takes place with due regard to the regulatory and statutory requirements. Available own funds and risk capital requirements are defined and calculated in accordance with Directive 2009/138/EC of 25 November 2009 and Delegated Regulation EU 2015/35 of 10 October 2014 for Solvency II requirements.
The eligible own funds comprise the consolidated Tier 1 capital, which essentially consisted of the subscribed share capital including the allocated share premium account and the reconciliation reserve. The Tier 2 capital consists entirely of subordinated liabilities. Tier 3 own fund items are mainly net deferred tax assets.
In the context of Group management, the appropriate coverage of the solvency capital requirement in accordance with Solvency II on a consolidated basis is constantly monitored. Active capital management is implemented to ensure that the individual Group companies and the Group as a whole have a reasonable capital base at all times. Aside from the five-year planning, another objective of active capital management is also to actively guarantee UNIQA’s financial capacity, including under difficult economic conditions, in order to safeguard the continued existence of the insurance business.
In addition to the regulatory requirements to meet solvency capital/minimum capital requirements, UNIQA has also set itself a target capitalisation for the Group in the form of a solvency capital ratio – i.e. the eligible own funds in relation to the solvency capital requirement – of at least 180 per cent. The solvency capital ratio is managed using strategic measures which result in a reduction in the capital requirements and/or increase the amount of existing capital.
UNIQA also takes the potential impact on the rating by recognised rating agencies into account in the capital management process. Standard & Poor’s (S&P) currently applies a credit rating of “A” to UNIQA Insurance Group AG. UNIQA Österreich Versicherungen AG, UNIQA Re AG and UNIQA Towarzystwo Ubezpieczeń S.A. each have a rating of “A+”. The supplementary capital bond issued in 2015 (originally: €500.0 million, outstanding balance: €326.3 million Tier 2, first call date: 27 July 2026) and the subordinated bond issued in 2021 (€375.0 million Tier 2, first call date: 9 July 2031) are rated “BBB” by S&P.