(Yicai Global) Sept. 28 -- Shares in HSBC Holdings closed up 9.75 percent today, the biggest gain since 2009, on the news that Chinese insurer Ping An Insurance Group has upped its stake once more in the UK lender.

Shares in HSBC [HKG:0005] ended the day at HKD30.95 (USD4), giving it a market capitalization of HKD640 billion (USD82.6 billion).

The Shenzhen-based insurer increased its shareholding to 8 percent from 7.95 percent on Sept. 23, according to the Hong Kong Stock Exchange. It has bought another 10.8 million shares at an average price of HKD28.30 (USD3.65) bringing its total holdings to 1.7 billion shares. The world’s biggest asset manager BlackRock is the second largest shareholder with 7.1 percent equity.

The 150-year-old lender has been hit by difficult times due to the impact of the Covid-19 pandemic on the financial sector, dwindling interest rates and big jump in credit loss provisions.

HSBC's stock has halved in value this year, and last week fell to their lowest level since 1995. Net profit slumped by 76.8 percent in the first half from the same period last year to USD1.98 billion and the London-based bank has suspended paying dividends to shareholders for the rest of this year.

Ping An, meanwhile, is taking full advantage of the bargain share price and appears to remain confident in the bank’s long-term prospects. This is despite already losing over 50 percent of its previous investment of HKD91.1 billion (USD11.8 billion) in additional shares bought in December 2017 and November 2018, now worth only HKD40 million.

Editor: Kim Taylor