Achleitner

"If you expect Italy to default, then you shouldn't buy these bonds no matter what insurance is attached to it," says Mr. Achleitner, who is involved in advising European Union authorities on the plan's implementation.

Calming Bond Markets Laura Stevens 2012

Mr. Achleitner stresses he doesn't believe any country will leave the euro zone but he adds that the company is well hedged if it does happen.

Calming Bond Markets Laura Stevens 2012

Allianz would be eager to use the bond-insurance program to justify buying Italian debt, as would many banks and investors, Mr. Achleitner says.

Calming Bond Markets Laura Stevens 2012

Mr. Achleitner says the insurance plan will become an important tool and a source of stability for those who believe in the long-term strength of countries such as Spain and Italy.

Calming Bond Markets Laura Stevens 2012

Mr. Achleitner began his career as strategy consultant at Bain & Co. in the U.S., then moved quickly through the ranks to investment banking at Goldman Sachs & Co ., ending up as head of the firm's German business in the late 1990s.

Calming Bond Markets Laura Stevens 2012

There's no doubt, those fit well into our investment strategy, Mr. Achleitner says.

Calming Bond Markets Laura Stevens 2012

Despite these concerns, Mr. Achleitner says even a limited insurance facility for newly issued bonds will give investors an incentive to start buying them again, acting as a mechanism for more market stability.

Calming Bond Markets Laura Stevens 2012

Looking back on his 12 years at Allianz, Mr. Achleitner says others will have to judge his success.

Calming Bond Markets Laura Stevens 2012

The most important step toward easing the debt crisis will take place when a new government-bond-insurance plan to help fiscally weaker countries attract investors is up and running in the coming weeks, says Mr. Achleitner, one of the architects of the plan.

Calming Bond Markets Laura Stevens 2012

Bloomberg News Paul Achleitner will return to his banking roots in May when he becomes chairman of Deutsche Bank's supervisory board after spending 12 years at German insurer Allianz.

Calming Bond Markets Laura Stevens 2012