Recent volatility in financial markets will curb inflows this year into Allianz’s asset management business, which includes U.S. bond giant Pimco, a board member told Reuters.

In 2017, Allianz reeled in 150 billion euros ($175.25 billion) in net inflows, a record for a single year, lifting the group’s third-party assets under management to 1.45 trillion euros.

The resulting higher income helped the company offset claims it paid for a series of major hurricanes, fires and earthquakes in North America during the costliest year ever for the industry.

But Jacqueline Hunt, the Allianz board member who oversees the German insurer’s asset management and U.S. life insurance businesses, said in an interview that volatility would make itself felt in 2018.

“The flow position will be far more muted this year,” she said. “Last year we brought in around 150 billion euros. We won’t see that repeat this year.”

“Whether it’s the political uncertainty, whether it’s the removal of QE, whether it’s any of the trade debates that are raging out there, it causes more volatile markets over the course of this year,” she said at an interview at Allianz’s Frankfurt office.

“We expect that in terms of flow numbers, it is going to be a tougher year inevitably,” she said.

Munich-based Allianz operates two big asset management groups that are among the world’s largest, Pimco and the smaller Allianz Global Investors.

Pimco has bounced back from several years of cash withdrawals in some of its main funds, including its flagship Pimco Total Return Fund. In a major blow to the money manager, co-founder Bill Gross, known as “the Bond King” during his years at Pimco, left in 2014 for Janus Capital Group Inc.

Hunt said that a key objective was to grow the asset management business in Asia, but she said mergers and acquisitions “are not a strategic priority for us.”

“We will continue to focus on bolt-ons,” she said. “If the right large deal came along, sure, we’d look at it… But it would need to meet our criteria, which is strategic fit, availability and the right terms.”

Earlier this year, Allianz chief executive Oliver Baete said he was generally open to a merger of equals. Speculation grew that Allianz could bid for rival Zurich Insurance, though Zurich played down the prospect.

Hunt also vigorously defended Allianz’s two-pillar model of operating Pimco and Allianz Global Investors separately, arguing that uniting them would not save costs and could destroy value because the “cultures of the two are so different.”

“The minute you start integrating, you are put on watch by clients and consultants,” she said. “You take the risk of losing important individuals.” ($1 = 0.8559 euros) (Reporting by Alexander Huebner and Tom Sims Writing by Maria Sheahan; Editing by Jan Harvey)