Hong Kong-listed life insurer National Mutual Asia, soon to be 74 per cent-owned by Australian parent National Mutual Holdings, revealed a 80 per cent drop in net profit for the year to September 30. Losses on its share and investment portfolio prompted a fall in full-year profit to $282 million, from an adjusted $1.47 billion for the previous 12 months. The company had announced an interim net profit of $352 million. Chief executive Terry Smith yesterday refused to reveal the exact figure of the investment loss, saying only that the investment portfolio's value was 6.6 per cent less than it was a year ago. Earnings per share were 12.98 cents, down sharply from 51.6 cents last year, while the final dividend was slashed from 17.9 cents to just one cent a share. The payout is 6.9 cents, down from 25.7 cents. Mr Smith said the insurer would have achieved a profit of more than $1 billion had it not been for the hefty investment losses. Operating profit for the past year had been strong with premium income rising 12 per cent to $5.89 billion and a 4 per cent jump in new life premiums to $911 million. The company also suffered losses on Hong Kong bonds because of interest rate rises. One of the most severe hits was the halving in value of its biggest property investment - the National Mutual Centre - to $670 million from $1.26 billion a year ago. Mr Smith forecast improved investment income in the present year after radical changes to the firm's $20 billion investment portfolio, such as withdrawing from world equity markets and shifting to cash and bonds. At the end of September, its investment portfolio was 65 per cent bonds, 31 per cent cash, 4 per cent property and nearly no equities. A year earlier it held 20 per cent equities, 19 per cent cash, 54 per cent bonds and 7 per cent property. 'The current portfolio has a moderate level of risk, which can cope with the current market volatilities,' Mr Smith said. 'However, we could return to the equities market again when the stock market returns to stability, in a bid to achieve the maximum return. 'For the long-term investment strategies, we hope to keep 20 per cent equities in our investment portfolio.' National Mutual Asia is to change its name to Axa China Region but the name of insurance arm National Mutual Insurance will stay. Mr Smith said the change reflected its link with ultimate parent, French-based Axa group.