Friday, March 28, 2008

China Life to focus more on bond investment in 2008

China Life Insurance Co<601628><2628>, the country's leading insurer as well as the largest institutional investor, said it will increase bond investment and reduce stock holdings this year due to the market volatility in mainland China and further tightening measures from the central bank, sources reported.

"We are not so optimistic about this year's investment market. So we will invest more in bonds and fixed-income assets to ensure steady income growth." said Liu Lefei, chief investment officer of China Life.

In response to its biggest rival Ping An's latest move of acquiring 50% stake in Fortis' asset management business, China Life's chairman Yang Chao said he saw "better (strategic investment) opportunities inside China than outside".

It was reported that China Life's equity holdings are mostly in the mainland Chinese market, with a small portion in Hong Kong stocks, which had contributed greatly to the company's profit in 2007 because of the bullish market last year.

Earlier this week, the insurer has invested US$300 million in Visa Inc's IPO, according to China Knowledge's report.

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