Ping An loses crown as Asia-Pacific's largest insurer by market cap in Q3 to AIA

Ping An Insurance (Group) Co. of China Ltd. lost its position as the biggest insurer by market capitalization in the Asia-Pacific to Hong Kong-based AIA Group Ltd. in the three months ended Sept. 30, ceding the spot it held for at least four years.

Ping An's market capitalization dropped to $131.28 billion after a 26.9% decline in its stock price in the third quarter, while AIA saw its market cap fall by a smaller 6.8% to $139.41 billion, according to data compiled by S&P Global Market Intelligence. China Life Insurance Co. Ltd. retained its third-place position on the list of the 20 largest Asia-Pacific insurers even after its market cap fell 12.3% to $108.51 billion.

The plunge in Ping An's market cap came as investors considered potentially tighter rules for the sector, regulatory scrutiny of the company's property investments and concerns over China's slowing growth. In early September, the China Banking and Insurance Commission proposed tighter rules for insurance groups that would require them to establish clear shareholding structures and mechanisms to detect potential contagion risks as well as to bolster oversight of their noninsurance units. Separately, the regulator is probing Ping An's investments in the property sector after the company disclosed a 20.8 billion yuan first-half impact from its exposure to China Fortune Land Development Co. Ltd.

Five out of six mainland China-based insurers on the list posted declines in market cap, with PICC Property and Casualty Co. Ltd. the only exception. PICC Property and Casualty logged an 11% growth in its market cap, the data showed.

Growing risks

The increasing frequency of extreme weather events in China could test the profitability and risk-selection processes of major property and casualty insurers, S&P Global Ratings credit analyst WenWen Chen said in an Aug. 9 research note. Heavy rains and floods in the country's Henan province in July led to a record for single-event insurance losses in China, at 11.2 billion yuan for life, property and casualty insurance claims combined, as of Aug. 3, the analyst said.

Indian insurers Bajaj Finserv Ltd. and SBI Life Insurance Company Ltd. recorded the biggest gains in market cap during the three-month period. Bajaj Finserv reported a 46.9% rise in market cap to $38.16 billion and jumped to the fourth spot on the ranking list, while SBI Life logged a market cap of $16.38 billion after a 20.6% quarter-over-quarter rise.

All Japanese insurers on the list logged market cap growth during the quarter, with Dai-ichi Life Holdings Inc. leading the pack with an 18.6% increase. Australia's Suncorp Group Ltd. entered the list to occupy the 20th spot, with a market cap of $11.56 billion.

As of Oct. 5, US$1 was equivalent to 6.45 Chinese yuan.

This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings, a separately managed division of S&P Global. Descriptions in this news article were not prepared by S&P Global Ratings.