Acquisition of assets from parent boosts insurer China Taiping’s profit
Mainland insurer China Taiping said its first-half earnings rose by 179 per cent year on year as the profit contribution from premium business increased following the acquisition of assets from its parent.
Net profit for the six-month period rose to HK$1.93 billion from HK$692 million in the same period last year, the company said in a statement to the Hong Kong stock exchange on Thursday.
The acquisition of shares in Taiping Life and Taiping General Insurance was completed by the end of last year, it said. The newly acquired interests in the life and property and casualty subsidiaries contributed an additional HK$560 million of profit to China Taiping in the first half.
The company acquired an additional 25.05 per cent interest in Taiping Life from parent China Taiping Insurance Group late last year, with its shareholding increasing to 75.1 per cent. It also acquired its parent’s 38.79 per cent shareholding in Taiping General Insurance, raising its interest in the unit from 61.21 per cent to100 per cent.
Premium income in the first half increased by 28 per cent year on year to HK$65.3 billion, while its new business value, a gauge of the profitability of new policies, increased by 44 per cent to HK$2.38 billion.
Operating profit for life insurance business jumped 5.3 times to HK$1.8 billion, and that for property and casualty insurance increased 25.6 per cent to HK$262 million.
Total investment income for the six-month period rose 55.5 per cent to HK$7.8 billion, with total investment yield improved by 0.36 of a percentage point to 5.14 per cent.
The company said it believed its overall operating results would be “significantly improved” this year as three years of restructuring came to a close.
Shares in China Taiping rose 0.12 per cent to HK$17.02 in the morning trading session, while the benchmark Hang Seng Index edged down 0.92 per cent. No interim dividend was declared.