Ping An eyes overseas financial, infrastructure sectors
(Reuters)Updated: 2007-06-04 13:59 Ping An Insurance (Group) Co. , China's second-largest life insurer, plans to broaden its overseas investment portfolio into the foreign financial sector and overseas infrastructure, once it gets approval from the government, a top executive said on Friday.
China will soon let insurance firms plough more money into equities and other assets overseas, including London- and New York-listed stocks, and is expected to let domestic insurers invest 15 percent of total assets abroad, up from 5 percent now.
"Currently, domestic insurers' investment channels are quite limited, the risk for investing in mainland bonds is low, but by globalising and diversifying investments, our investment portfolio could be more balanced," said Louis Cheung, an executive director of Ping An, in comments embargoed until Monday.
Ping An had 494.3 billion yuan ($65 billion) in total assets at the end of last year, meaning it could invest at least 74 billion yuan abroad if China lifts the cap to 15 percent.
"Once the new rule is implemented, we will initially look into financial, infrastructure and property sector investment opportunities in overseas markets," said Cheung.
Ping An becomes a component of Hong Kong's main stock index on Monday and it plans eventually to team up with Wall Street firms Morgan Stanley and Goldman Sachs to invest in emerging markets such as India and eastern Europe.
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Ping An currently has a $1.7 billion quota under the Qualified Domestic Institutional Investor scheme, which allows it to buy overseas-listed Chinese stocks.
Ping An's targeted investment return for its overseas porftolio should be at least 4.5 percent, Cheung said.
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The government has been relaxing restrictions on insurers by allowing them to buy equity stakes in banks and to finance long-term infrastructure projects.
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