CHINA Life Insurance said profit surged 174 per cent in the first nine months of the year as a rally in the nation’s stock market bolstered investment returns.
Net income rose to 104.5 billion yuan (S$19.4 billion) this year through Sep 30, from a revised 38.2 billion yuan a year earlier, the Beijing-based company said in a filing to the Shanghai stock exchange on Wednesday (Oct 30). The increase quickened from an 11 per cent gain in the first half.
A 17 per cent jump in the benchmark CSI 300 Index boosted Chinese insurers’ investment returns during the period, offsetting the impact of lower bond yields. China Life’s profit is set for a record high this year as it benefits from higher exposure to equities, according to Bloomberg Intelligence analyst Steven Lam.
Total investment income for the nine months rose 152 per cent from a year earlier to 261 billion yuan, according to the filing. Fair-value gains on investments surged more than 80 times to 147.7 billion yuan.
The CSI 300 surged 27 per cent in late September after the government’s economic stimulus package fuelled optimism. The index has since pared gains as investors waited for more clarity on further fiscal support.
New business value, which gauges the profitability of new life policies sold, rose 25 per cent in the first nine months, accelerating from a 19 per cent increase in the first half.
Competitor Ping An Insurance (Group) last week reported a 36 per cent gain in net income for the nine months as investment income more than tripled.
China Life fell 2.73 per cent to HK$16.36 in Hong Kong trading before the announcement. The shares have gained 62 per cent this year. BLOOMBERG
