Ping An Insurance profit rises 28 per cent to 17.91 billion yuan

Ping An Insurance, the mainland's second-largest insurer, posted stronger-than-expected first-half profit growth of 28.3 per cent, boosted by improved investment income and contributions from its banking operation.

Net profit for the six months to June rose to 17.91 billion yuan (HK$22.53 billion) from 13.96 billion yuan in the same period last year, the company said in a statement to the Hong Kong stock exchange yesterday. The figure was higher than an average estimate of 13.58 billion yuan of three analysts polled by Reuters.

Total investment income for the period increased by 90 per cent to 26.43 billion yuan, while annualised investment yield was 0.3 of a percentage point higher at 4.8 per cent, the highest in three years, the company said. Impairment losses on investments also contracted to 1.05 billion yuan from 3.91 billion yuan a year ago as capital markets improved.

Ping An chairman Ma Mingzhe said in the statement that the company steadily increased its high-interest fixed-income investments in its portfolio and also seized investment opportunities arising from volatile capital markets in the first half.

Profit contribution from Ping An Bank, its banking unit, increased by 11.8 per cent to 3.88 billion yuan.

Ping An said its written premium for life insurance rose 10.4 per cent to 126.8 billion, while premium income for property and casualty business increased by 10.2 per cent to 53.74 billion yuan. New business value, a measure of the present value of future business, grew by 14.2 per cent, outperforming rivals. Analysts said the insurer was well-positioned amid rising competition with solid growth in first-year regular and single premiums through the agent channel, which offered a higher profit margin.