Allianz SE's fund management arm should be profitable this year and next as its large holdings of fixed-income assets help shield it from global market turmoil, a senior executive said, according to Reuters.

But profit margins at the fund arm of Europe's largest insurer are under pressure, prompting the firm to imposed a "soft freeze" on new hires and look at scaling back bonuses from 2007 levels, said Marna Whittington, chief operating officer at Allianz Global Investors.

The Frankfurt-listed firm has no current plans for widespread job cuts, given that it wants to maintain fund performance and customer service levels, she said, adding that managers were being encouraged to "part company with underperformers."

"We want to be top quartile in profitability through a full market cycle, which means we're very willing to take profit margin pressure in times like this," she told the news service in an interview in Hong Kong.

Allianz Global Investors, which controls a stable of fund managers including fixed-income giant PIMCO, had €970 billion ($1.2 trillion) of assets under management at the end of last year.

Excluding funds from its parent's insurance operations, it had €725 billion from third partner investors, about 78 per cent of which were invested in fixed-income markets.

Allianz said this month that operating revenues at its asset management division decreased to €698 million in the third quarter from €803 million a year earlier, and operating profit fell 44 per cent.