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Bank of Beijing could buy half of ING life venture

Bank of Beijing Co (北京銀行), part owned by ING Groep NV, is in talks to buy half of ING’s Chinese life insurance venture in what would be its second acquisition in three months.

Bank of Beijing is negotiating terms for Beijing Capital Group Co’s 50 percent stake in ING Capital Life Insurance Co (首創安泰人壽), it said in a statement yesterday. ING Groep, the biggest Dutch financial-services firm, owns the other half of ING Capital Life, which was established in 2002 and had 2 billion yuan (US$293 million) in premiums at the end of last year.

China is letting banks expand into brokering, fund management and insurance, winding back former Chinese premier Zhu Rongji’s (朱鎔基) 1993 restrictions, to help them become less reliant on income from lending. A 64 percent stock market drop this year has curbed mutual fund sales at banks, and a slowing economy is eroding demand for loans while pushing bad debts higher.

Bank of Beijing won approval in July to buy 20 percent of Langfang City Commercial Bank (廊坊市商業銀行) for 127.5 million yuan. The bank now has 131 branches in Beijing and outlets in Tianjin, Shanghai and Xian.

ING, which received a 10 billion euro (US$13.4 billion) lifeline from the Netherlands, agreed to sell its Taiwanese life insurance unit for US$600 million to Taipei-based Fubon Financial Holdings Co (富邦金控), the two firms said on Monday.
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