China Life Insurance Co (中國人壽), the nation’s fifth-largest life insurer by market share, yesterday said the company was better equipped than its peers to make property investments this year as it is the only major insurer with a capital adequacy of more than 300 percent.
China Life chairman Alan Wang (王銘陽) made the statement during an investors’ conference in Taipei, where he said the company is set to take advantage of its strength to increase its property stakes to between 5 and 8 percent of its total working capital, from less than 3 percent at present.
“China Life enjoys greater flexibility and competitiveness in making offers given its capital adequacy level,” Wang said.
The Financial Supervisory Commission recently said it was considering lowering yield requirements on property investments by insurers, allowing them to make greater investments in property.
The commission could cut the yield threshold to a range of between 2.375 percent and 2.875 percent, from a flat 2.875 percent, depending on a company’s capital strength, local media reported.
China Life will limit its property investments to the Greater Taipei area as some districts in New Taipei City (新北市) are now as commercially viable as areas in Taipei, Wang said.
However, the company is not planning to join the bidding for a plot of land in Xinyi District (信義), he said.
The company yesterday updated its embedded value (EV) to NT$94.8 billion (US$3.16 billion) at the end of last year, an increase of 19.2 percent from a year earlier.
The figures represent an EV of NT$39.71 per share, company data showed, compared with a share price of NT$31.85 at close of trading on the local bourse yesterday, according to Taiwan Stock Exchange data.
Meanwhile, the insurer voiced satisfaction over its investment in Jian Xin Life Insurance Co (建信人壽), a subsidiary of China Construction Bank Corp (中國建設銀行), which may add five to eight new branches this year.
Jian Xin’s ranking climbed to 16th place in terms of premiums as of February, up from 18th place last year, Wang said.