China's Insurance Regulator Extends its Inquiry of Insurers to Anbang
Yicai Global
/SOURCE : Yicai
China's Insurance Regulator Extends its Inquiry of Insurers to Anbang

(CBN - Global)(CBN Global) May 10 -- The China Insurance Regulatory Commission is to send a task force to look into major insurer Anbang Insurance Group Co. to gain a better understanding of their business dealings.

This comes just a week after the government agency dispatched an inspection task force to survey Funde Sino Life Insurance Co., a Shenzhen-based professional life insurance company.

Anbang Insurance and Funde Sino Life have both rapidly risen from obscurity to become the 'dark horses' of China's private insurance industry by offering non-traditional yet lucrative short-term, low-security wealth management insurance products.

Anbang Insurance has recently exploded onto the international scene with a succession of high-value mergers and acquisitions. Last year the company bought New York's Waldorf-Astoria Hotel from Hilton Worldwide Holdings Inc. [NYSE:HLT] for USD1.95 billion. In March it agreed to buy Strategic Hotels & Resorts from Blackstone Group LP [NYSE:BX] for USD6.5 billion, marking the highest price paid by a mainland Chinese buyer for a real estate asset in the US.

Chinese regulators were clearly not supportive of either deal. Anbang Insurance announced plans last month to purchase German insurer Allianz SE's [FWB:ALV] South Korean businesses for more than USD3 million. However, this transaction has yet to be approved by regulators, CBN has learned.

In the first quarter Anbang Insurance became China's third-largest insurer in terms of premiums, just CNY7.6 billion (USD1.17 billion) behind the second-largest insurer, Ping An Insurance Group Co. [SHA:601318], according to data from CIRC.

Anbang Insurance's premiums for its wealth management insurance products have jumped by leaps and bounds. The CIRC is very concerned about their liquidity, solvency risks and asset quality.

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