IN­SUR­ERS EX­PECT BET­TER FOR­TUNES IN 2013, AF­TER TOUGH 12 MONTHS

Insurance - - INDUSTRY UPDATES -

DE­SPITE a plunge in 2012 net prof­its, China's ma­jor in­sur­ance com­pa­nies say they ex­pect a more pros­per­ous 2013, thanks to the re­lax­ation of rules mak­ing it eas­ier for them to raise new funds and ex­pand into in­vest­ment busi­nesses. Six of China's largest in­sur­ers listed in Shang­hai and Hong Kong have re­leased an­nual fig­ures for 2012, show­ing com­bined net prof­its of 46.7 bil­lion yuan (MYR22.79 bil­lion), a 22% drop on 2011. Ac­cord­ing to Xiang Junbo, chair­man of the China In­sur­ance Reg­u­la­tory Com­mis­sion, the slow­down in profit growth by the oth­ers was blamed on shrink­ing in­come from life in­sur­ance pre­mi­ums due to fierce com­pe­ti­tion, com­par­a­tively lower in­vest­ment re­turns, and an im­mi­nent peak in ma­tur­ing poli­cies and other pay­outs. The reg­u­la­tory au­thor­i­ties have no­ticed the prob­lems faced by China's big­gest in­sur­ers. An­a­lysts said that an eas­ier fundrais­ing en­vi­ron­ment in 2013 may help im­prove sol­vency lev­els and long-term liq­uid­ity, as will any ex­pan­sion of in­vest­ment chan­nels by the reg­u­la­tors, who have al­ready sensed the dif­fi­cul­ties be­ing felt in the in­sur­ance sec­tor.

CNY100 = MYR48.80

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