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Chinese insurers look overseas; Standard Life to sell Hong Kong biz

S&P Global Market Intelligence offers our top picks of insurance news stories and more published throughout the week. Please note that some entries may have links to third-party sources that may require a subscription.

Chinese insurers to boost overseas investments

* China Life Insurance Co. Ltd. plans to increase its overseas investments in 2017 as it looks to increase returns despite more stringent rules for outbound transactions. Overseas investment would diversify the insurer's investment portfolio and increase its investment return, said Zhao Lijun, a vice president at China Life, at the company's annual results briefing.

* Ping An Insurance (Group) Co. of China Ltd. will invest in more Japanese companies and real estate through private equity funds in a bid to get higher returns and manage currency risks.

M&A updates

* Standard Life Plc agreed to sell its Hong Kong Insurance business Standard Life (Asia) Ltd. to its Chinese joint venture insurance business, Heng An Standard Life Insurance Co. Ltd. Once the proposed transaction is complete, Standard Life (Asia) will be wholly owned by Heng An Standard Life.

* Sompo Holdings Inc. completed its acquisition of Endurance Specialty Holdings Ltd. The total consideration for the acquisition was US$6.3 billion.

* New Zealand-based CBL Corp. Ltd. plans to acquire U.S.-based Affirmative Direct Insurance Co. Ltd. in a US$5.7 million transaction.

* ICICI Lombard General Insurance Co. Ltd. shortlisted three private equity companies to acquire a 35% stake in the insurer. The companies are Warburg Pincus LLC, Carlyle Group LP and Temasek Holdings (Pvt) Ltd. The deal is expected to fetch up to US$1 billion.

Rating agency actions

* S&P Global Ratings affirmed AIG Insurance New Zealand Ltd.'s A rating with a stable outlook. The rating reflects the insurer's adequate market position and reasonably strong capital adequacy.

* Moody's upgraded the ratings of AIA Group Ltd. and its units due to the insurer's strong financial profile, earnings track record and robust capitalization. The rating agency raised the issuer rating and the senior unsecured debt ratings of the Hong Kong-based insurer to A2 from A3.

* Moody's assigned New China Life Insurance Co. Ltd. an A2 insurance financial strength rating with a stable outlook. The rating reflects the insurer's established market franchise and diversified product mix.

Chinese insurers report drop in 2016 profits

* People's Insurance Co. (Group) of China Ltd. reported a year-over-year drop in net profit for the year ended Dec. 31, 2016, to 14.25 billion Chinese yuan from 19.54 billion yuan.

* China Pacific Insurance (Group) Co. Ltd. saw a 32% year-over-year decline in net profit as investment income dipped. Net profit attributable to equity holders fell to 12.06 billion yuan from 17.73 billion yuan the previous year.

* New China Life Insurance reported a 42.5% decline in net profit for the year, partly due to lower investment income.

* PICC Property & Casualty Co. Ltd. reported a 17.5% year-over-year drop in net profit as claims and underwriting expenses increased.

* Taiwan's Fubon Financial Holding Co. Ltd. saw its net income fall year over year to NT$48.42 billion, or NT$4.73 per share, from NT$63.59 billion, or NT$6.21 per share.

In other news

* SBI Life Insurance Co. Ltd. will move ahead with its proposed IPO after State Bank of India gave its in-principle approval for the plan. The insurer intends to sell a 10% stake through the offering, of which 8% will come from State Bank of India.

* SBI Life Insurance also plans to expand in Bahrain in fiscal 2017-2018. The insurer is waiting for regulatory approval from the Central Bank of Bahrain to open a branch in the country.

* MS&AD Insurance Group Holdings Inc. injected ¥100 billion of capital into unit Mitsui Sumitomo Aioi Life Insurance Co. Ltd. The move aims to enhance Mitsui Sumitomo Aioi Life's financial base.

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