China Life Insurance Co. (2628), the nation’s largest insurer, said profit jumped 68 percent in the first half of this year as investment income rose and impairment losses dropped.
Net income increased to 16.2 billion yuan ($2.65 billion), or 0.57 yuan a share, from 9.64 billion yuan, or 0.34 yuan a share, a year earlier, the Beijing-based insurer said in a statement to the Shanghai stock exchange today. The company said July 30 that first-half profit may increase by more than 50 percent.
China Life wrote off 31.1 billion yuan last year to absorb declines in the value of its equity holdings, helping it to book gains from a bull run in the benchmark Shanghai Composite Index (SHCOMP) early this year before stocks tumbled amid an economic slowdown. Net premiums earned climbed 8.7 percent, reversing a decline in the same period last year, as the company boosted sales of lower-margin products to improve growth.
“As a major institutional investor, China Life’s investment returns benefited hugely from improvements in the market, pushing up its profit growth,” Chen Xingyu, a Shanghai-based analyst at Phillip Securities Group, said before the statement.
Investment income rose 25 percent to 49.4 billion yuan, the company said. Impairment losses from investments, which jumped 140 percent last year, dropped 76 percent in the first half to 3.7 billion yuan, according to the statement.
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