Date
20 August 2017
Chief financial officer Vincent Li (extreme right) says Taiping is studying the investment risk and return of its planned overseas expansion. Sheldon Yu (extreme left), general manager of the corporate planning and actuarial department, is optimistic abou
Chief financial officer Vincent Li (extreme right) says Taiping is studying the investment risk and return of its planned overseas expansion. Sheldon Yu (extreme left), general manager of the corporate planning and actuarial department, is optimistic abou

Taiping Insurance weighs risk in overseas foray

China Taiping Insurance Holdings Co. Ltd. (00966.HK) will proceed cautiously with its overseas expansion plans amid volatile interest rates.

“We are looking at some projects and their investment risk and return,” chief financial officer Vincent Li told reporters in Hong Kong. “We are very cautious about fluctuations in interest rates and exchange rates.”

Li said the insurer is looking to expand into infrastructure and real assets “but we have yet to decide on specific areas”.

China Taiping is following in the footsteps of other Chinese insurers. 

China Life Insurance Co. Ltd. (02628.HK) and Qatar Holding LLC bought a one million-square-foot commercial building in London for 795 million pounds (US$1.4 billion) from Canary Wharf Group, the British company said in a statement on June 20.

On July 18, real estate services provider Savills Plc. said German asset management company Commerz Real sold The Lloyd’s Building to a Chinese insurer, the first purchase by a Chinese insurance company in the United Kingdom.

Some media reports quoted sources as saying the buyer was Chinese Ping An Insurance (Group) Co. of China Ltd. (02318.HK), the mainland’s second largest life insurer.

Taiping posted a nearly threefold increase in net profit to HK$1.93 billion (US$248 million) in the first six months compared with the same period last year. Life insurance contributed the most to the bottom line after rising 5.3 times to HK$1.82 billion, according to a stock exchange filing Thursday.

Bancassurance accounted for HK$29.73 billion of Taiping’s first-half premiums of HK$50.72 billion, followed by individual agency at HK$20.11 billion. 

Sheldon Yu, general manager of the corporate planning and actuarial department, said the insurer is optimistic about the long-term prospects of the bancassurance business.

“The value of our prime bancassurance product this year is up 19 percentage points compared with our prime product last year,” Yu said.

More than 20,000 bank branches sell Taiping products. More than half of them are among the five biggest Chinese banks, he said.

Last week, the State Council said the insurance industry should be completely modernized by 2020 as part of efforts to raise protection standards for individuals and businesses and boost the quality of risk and wealth management in the country.

– Contact the reporter at [email protected]

RA

Ayishah Ma is a financial reporter on Greater China issues.

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