PICC to Help Life Insurance Unit Increase Capital

People's Insurance Company (Group) of China Limited (PICC) plans to increase the capital base of its life insurance arm PICC Life, President Wu Yan of the parent group disclosed.

In the middle of 2007 and mid-2009, actually, the registered capital of the Beijing-based life insurer had been raised to CNY 2.71 billion and CNY 5.42 billion respectively. As the parent company, PICC currently takes a 80% stake in the life insurance unit directly and indirectly.

PICC Life during the first eight months of this year reaped the premium revenues of CNY 59.44 billion, up 60.5% year on year. This year, the life insurer has set the goal to achieve the premium revenues of CNY 100 billion. From this January to October, the life insurer reaped the net profits of CNY 546 million; and by the end of this October, the assets of the life insurance company stood at CNY 160.7 billion.

As the parent group of PICC Life, PICC currently has 12 professional financial subsidiaries engaged in the property insurance, life insurance, health insurance, assets management, investment and so forth. In the coming year, PICC expects to launch a dual listing in the stock markets of China's Mainland and Hong Kong. By now, the introduction of domestic strategic investors has almost come to the end. Reports said that the group will only have one state-owned enterprise under the control of the Ministry of Finance as its domestic strategic investor.

By now, PICC's total assets have exceeded CNY 400 billion and it has had assets of more than CNY 800 billion under the management, with thee capital utilization balance standing at CNY 350 billion. As the bond and equity investment platform, PICC Capital Investment Management Company Limited in the first half year of 2010 conducted investigations to 29 bond investment projects and 67 equity investment projects.

PICC Property and Casualty Company Limited (PICC P&C, 2328.HK), the Hong Kong-listed non-life insurance platform of Beijing-based PICC, is now the major profit contributor of the parent company. From this January to August, the Beijing-based non-life insurer earned total premium revenues of CNY 105.1 billion, an increase of 22.6% year on year. Solvency adequacy ratio of PICC P&C stood at 117% by the end of this June. However, the market share of the company declined one percentage point from last yearend to 39% in the first half of this year.