Asia Financial Holdings said it is considering increasing its stake in PICC Life Insurance by about 15 per cent, from HK$867 million to HK$1 billion, betting on the further development of the mainland's insurance industry. 'PICC Life insurance liability reserves and solvency ratios were maintained at high levels, in line with the fast-growing business volume,' said Bernard Charnwut Chan, president of Asia Financial. He said he was upbeat about future co-operation with the mainland insurance company. PICC Life Insurance posted HK$94.3 million in net profit attributable to shareholders in the first half of the year, up 276.6 per cent compared with the same period last year. Chan said the gain was largely due to increasing profits among joint ventures and associated companies, including BC Reinsurance and Hong Kong Life Insurance, both of which had improved performance. PICC reported 43.7 billion yuan (HK$53.35 billion) in premium income in the first half of the year, up 6.4 per cent compared to the same period last year. The group is also involved in real estate projects in Shanghai and Suzhou. Its main project is a residential and commercial complex in the Jiading district of Shanghai in which it owns a 27.5 per cent stake. Chan said the company had sold about 95 per cent of the first phase of the project, posting a total profit of about HK$46 million. The second phase of the project was expected to be completed in the first quarter of next year, while the company will launch construction on an area of 160,000 square metres in 2012. The group's underwriting profit fell 7.4 per cent to HK$48.8 million in the first half compared with last year due to natural disasters in Japan, Australia and New Zealand, the company said. Asia Financial recorded a decline in year-on-year unrealised losses on trading investment. The improved results were brought about by a more cautious investment approach and minimum exposure to the vulnerable European sovereign debt market, Chan said. For the company's investment portfolio, Chan said Asia Financial would increase its exposure to blue chips stocks in the near future.