Allianz moved to shore up $19 billion structured investment vehicle K2 managed by its Dresdner Bank unit and said it was rolling back its business in complex finance products hit hard by global credit turmoil.

Europe’s biggest insurer confirmed on Thursday it made record net profit of nearly 8 billion euros ($11.79 billion) in 2007, despite earnings that nearly halved in the fourth quarter as a result of big write-downs at Dresdner.
Dresdner Bank said it was cutting back on its activity in structured investment vehicles  and other structured products at the root of the credit crisis and cutting 450 jobs, though most had already been shed. “Dresdner Bank will reduce its engagement in the SIV business as the model of interest arbitrage faces a tough future,” Allianz Chief Executive Michael Diekmann said.