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Taiwan Ratings: China Life Insurance outlook stable

2012/07/24 20:14:37

Taipei, July 24 (CNA) Taiwan Ratings Corp., a local partner of Standard & Poor's, said Tuesday that the outlook for Taiwan-based China Life Insurance Co.'s credit rating is stable after assigning"twAA-" on the basis of the company's issuer financial strengthand counterparty credit rating.

"The stable outlook reflects our expectations that China Life's adequate underwriting and strong asset liquidity management will support its credit profile in the coming one to two years," Taiwan Ratings said in a statement.

"We also expect China Life to grow its business in a profitable way with adequate product pricing," the ratings agency said.

Taiwan Ratings said it assigned the "twO-" rating as the company has "good liquidity, satisfactory operating performance and adequate financial flexibility."

According to the ratings agency, China Life's assets totaled NT$730.3 billion (US$24.34 billion) in 2011, making the company the fifth-largest life insurer in Taiwan.

In addition, China Life grasped a 6.6 percent share of the total local premiums last year, up from 5.2 percent recorded in 2010, although the domestic insurance market was full of fierce competition, Taiwan Ratings said.

As it is a listed company on the local bourse, China Life has a good track record in fund-raising from the capital market, including new funds of NT$7.3 billion in 2009 after the onset of the global financial crisis, and a fund of NT$7.5 billion in 2011, Taiwan Ratings added.

As of the end of March 2012, China Life 's cash and deposits, and fixed income securities -- which were largely liquid government bonds and financial bonds -- made up about 84 percent of the company's total invested assets, according to Taiwan Ratings.

Shares of China Life Insurance closed up 0.90 percent at NT$27.95 on the main board Tuesday, when the benchmark weighted index ended down 0.28 percent, at 7,008.35 points.

(By Kao Chao-fen and Frances Huang)