The Paper reporter Hu Zhiting
China Re Visual China Data chart
China Re had previously expected net profit to decrease by about 40% to 50% year-on-year in the first half of this year, and the disclosed semi-annual report exceeded expectations.
html On August 29, China Reinsurance Group Co., Ltd. (China Re, 1508.HK) released its 2022 semi-annual report, which showed that in the first half of this year, China Re achieved total premium income of 87.98 billion yuan, a year-on-year increase of 45.6%; it achieved net profit attributable to shareholders of the parent company of 1.681 billion yuan, a year-on-year decrease of 58.1%.As for the reasons for the decline in net profit, China Re said that firstly, affected by factors such as the rebound of the new crown epidemic, geopolitical conflicts, and macroeconomic pressure, the capital market experienced significant fluctuations, and investment income decreased year-on-year; secondly, the investment income of the associate Great Wall Assets decreased significantly year-on-year.
China Re also explained that the above-mentioned net profit data attributable to shareholders of the parent company are different from the company's previously disclosed "Announcement on Pre-Reduction of Performance for the First Half of 2022", mainly due to the fact that Great Wall Assets announced its audited 2021 financial data on August 26, 2022.
China Re stated that based on the forecast data of Great Wall Asset's future operating performance provided to it by Great Wall Asset Management, after careful evaluation, China Re made an impairment provision of 548 million yuan for the Great Wall Asset Project , resulting in an increase in the decline in China Re's net profit attributable to shareholders of the parent company in mid-2022, exceeding the 40% to 50% decline range disclosed in the performance reduction announcement, reaching 58.1%. Excluding the impact of the above-mentioned factors of Great Wall Asset, the company's first-half performance is consistent with the information in the performance reduction announcement.
China Re, through its subsidiaries China Re Property and Casualty Insurance and Continent Property and Casualty Insurance, holds a total of 6.5% of Great Wall Asset's shares . The Paper noticed that Great Wall Asset’s 2021 annual report disclosed on August 26 showed that the company achieved a net profit attributable to the parent company of -8.562 billion yuan last year, turning from profit to loss. China Re also stated in its semi-annual report that on August 26, Great Wall Asset provided the company with its audited financial statements for 2021. There were differences with the financial statements previously provided to the group. Therefore, the company's 2021 accounting results based on the equity method need to be adjusted accordingly. At the same time, the company implements the relevant regulations of the Ministry of Finance on the salary management of state-owned financial enterprises and determines the salary for the year based on the operating conditions in 2021. Therefore, the company's salary for 2021 also needs to be revised accordingly.
In the first half of this year, China Reinsurance's total investment income was 4.352 billion yuan, a year-on-year decrease of 57.8%. The annualized total investment return rate was 2.76%, a year-on-year decrease of 3.79 percentage points. The net investment income was 7.606 billion yuan, a year-on-year increase of 5.6%. The annualized net investment return rate was 4.82%, a year-on-year increase of 0.24 percentage points.
's semi-annual report shows that in the first half of this year, China's reinsurance business structure continued to optimize. Domestic property reinsurance non-auto insurance business increased by 42.1% year-on-year, accounting for an increase of 6.6 percentage points, of which emerging businesses increased by 52.9% year-on-year; Foreign property reinsurance and bridge insurance business increased by 17.7% year-on-year; domestic personal reinsurance protection business increased by 12.6% year-on-year, accounting for an increase of 7.3 percentage points; domestic property insurance direct insurance non-auto insurance business increased by 9.2% year-on-year, accounting for an increase of 1.9 percentage points, accounting for more than half of the total for the first time.
In terms of underwriting efficiency, in the first half of this year, China Re's direct property insurance business achieved a significant reduction in underwriting losses; Bridge Society still achieved good underwriting profits despite cautiously setting aside reserves for the Russia-Ukraine conflict and enduring losses from natural catastrophes.
China Re is China's only state-owned professional reinsurance company, approved by the State Council and established on the basis of the original China Reinsurance Co., Ltd. (established in January 1996). It was officially established on March 18, 1999. In August 2003, it was restructured and established as a wholly state-owned insurance group company on the basis of the original China Reinsurance Company.
Editor in charge: Zheng Jingxin Picture editor: Jiang Lidong
Proofreading: Ding Xiao
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