China Life vows bigger overseas investment, and to limit exposure to equities
Current US$7.6b offshore portfolio ‘too small’, says vice chairman. Focus likely to be property sector and stakes in unlisted companies
China Life, the nation’s biggest life insurer that backs car-hailing giant Uber Global, has vowed bigger investment into overseas markets, after reporting an 67 per cent plunge in interim profit, which officials blamed on the low-interest rate environment home and a volatile capital market.
Zhao Linjun, its vice president, said the group has currently allocated around US$7.6 billion onto offshore markets, mainly focused on the property sector, and stakes in unlisted companies.
“But the proportion is too low, and we expect to raise it and diversify our portfolio,” he told a press briefing on Friday morning, adding the company would work to raise its overseas investment ratio to 15 per cent, the cap set by the China Insurance Regulatory Commission.
China Life has teamed up with an many as seven US-based private equity funds, to actively seek opportunities in the US and Europe. It invested in Uber Global in 2015, but the stake and value was not disclosed.
Gross investment yield for the first half dropped to 4.36 per cent from 9.34 per cent in the same period last year, mainly due to losses from equity investment, compared with big gains in the same period last year, Zhao said.
We will continue to limit the exposure to equity investment based on a prudent investment style... we do not see the A-share market turning around its performance in the second half
Its biggest property investment has been two office buildings in London and one in New York city, carrying tenant contracts. The company is also interested in serviced apartments complexes, while target sectors logistics and retail operations, he added.