CHINA PACIFIC INSURANCE (GROUP) CO., LTD. Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.
中國太平洋保險（集團）股份有限公司
CHINA PACIFIC INSURANCE (GROUP) CO., LTD.
(A joint stock company incorporated in the People's Republic of China with limited liability)
(Stock Code: 02601)
OVERSEAS REGULATORY ANNOUNCEMENT
This overseas regulatory announcement is made pursuant to Rule 13.09 and Rule 13.10B of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules") and the Inside Information Provisions (as defined in the Listing Rules) under Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong).
The announcement is attached hereof for information purpose only.
By Order of the Board
China Pacific Insurance (Group) Co., Ltd.
KONG Qingwei
Chairman
Hong Kong, 31 October 2019
As at the date of this announcement, the Executive Director of the Company is Mr. KONG Qingwei; the Non-executive Directors of the Company are Mr. WANG Tayu, Mr. KONG Xiangqing, Ms. SUN Xiaoning, Mr. LI Qiqiang, Mr. WU Junhao, Mr. CHEN Xuanmin and Mr. HUANG Dinan; and the Independent Non-executive Directors of the Company are Mr. LEE Ka Sze, Carmelo, Mr. CHEN Jizhong, Ms. LAM Tyng Yih, Elizabeth, Mr. JIANG Xuping and Mr. GAO Shanwen.
Summary of Quarterly
Solvency Report
China Pacific Property Insurance Co., Ltd.
3rd Quarter of 2019
Contents
I. BASIC INFORMATION ........................................................................................... | 1 |
II. MAIN INDICATORS .............................................................................................. | 2 |
III. ACTUAL CAPITAL ................................................................................................ | 2 |
IV. REQUIRED CAPITAL ............................................................................................ | 3 |
V. INTEGRATED RISK RATING................................................................................... | 3 |
VI. RISK MANAGEMENT STATUS ............................................................................. | 3 |
VII. LIQUIDITY RISK ................................................................................................. | 4 |
VIII. REGULATORY MEASURES TAKEN AGAINST THE COMPANY ............................. | 5 |
I. Basic information
(I) Registered address
South Tower, Bank of Communications Financial Building, 190 Middle Yincheng Road, China (Shanghai) Pilot Free Trade Zone, Shanghai, the PRC
(II) Legal representative
GU Yue
(III) Business scope and territories
1．Business scope
Property indemnity insurance; liability insurance; credit and guarantee insurance; short term health and personal accident insurance; reinsurance of the above said insurance; insurance funds investment as approved by relevant laws and regulations; other business as approved by the CIRC.
2. Business territories
The People's Republic of China (excluding Hong Kong, Macao and Taiwan)
(IV) Ownership structure and shareholders 1．Ownership structure
Equity categories | Shares or contributed amounts | Percentage（%） |
(10K shares) | ||
Domestic shares held by legal entities | 1,947,000 | 100 |
Domestic shares held by natural persons | ||
Foreign shares | ||
Others | ||
Total | 1,947,000 | 100 |
2．Top 10 shareholders
Names of shareholders | Shares held as at the end of the | Percentage of shareholding (%) |
reporting period | ||
China Pacific Insurance (Group) Co., Ltd. | 19,178,214,743 | 98.50 |
Shenergy Group Co., Ltd. | 90,874,742 | 0.47 |
Shanghai Haiyan Investment Management | 90,620,982 | 0.46 |
Company Limited | ||
Yunnan Hehe (Group) Co.,Ltd. | 59,586,361 | 0.31 |
Shanghai State-owned Assets Operation | 50,703,172 | 0.26 |
Co., Ltd. | ||
Total | 19,470,000,000 | 100 |
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(V) Controlling shareholder or de facto controller
China Pacific Insurance (Group) Co., Ltd. is the majority shareholder of the Company,
holding 98.5% of its stake.
(VI) Subsidiaries, joint or associate ventures
Name of companies | Number of shares (10K) | Percentage of the |
shareholding (%) | ||
Ningbo Xikou Garden Hotel | 386 | 48.20 |
Shanghai Binjiang-Xiangrui Investment and | 1,071 | 35.70 |
Construction Co., Ltd. | ||
Anxin Agricultural Insurance Co., Ltd. | 36,490 | 52.13 |
Shanghai Juche Information Technology Co., Ltd. | 148 | 25.20 |
Zhongdao Automobile Assistance Co., Ltd | 1,280 | 22.07 |
CPIC Euler Hermes Credit Insurance Sales Co., Ltd | 2,550 | 51.00 |
Shanghai Xingongying Information Technology Co. Ltd. | 20 | 6.44 |
Shanghai Heji Business Management Partnerships ( LP) | 50,000 | 99.60 |
(VII) Contacts for solvency information disclosure
1．Contact person：CHEN Mo
2．Tel. number：021-33966153
II. Main indicators
As at the end of this | As at the end of last | ||
Item | quarter/during this | ||
quarter/during | last quarter | ||
quarter | |||
Core solvency margin ratio | 230% | 224% | |
Core solvency margin (10K RMB) | 2,110,051 | 2,007,309 | |
Comprehensive solvency margin ratio | 291% | 286% | |
Comprehensive solvency margin (10K RMB) | 3,110,051 | 3,007,309 | |
Latest IRR result | - | B | |
Premium income (10K RMB) | 3,118,726 | 3,306,604 | |
Net profit (10K RMB) | 91,288 | 248,950 | |
Net assets (10K RMB) | 3,782,955 | 3,676,196 | |
III. Actual capital
Item | As at the end of this quarter | As at the end of last quarter | |
Admitted assets (10K RMB) | 17,032,332 | 16,939,400 | |
Admitted liabilities (10K RMB) | 12,297,438 | 12,313,540 | |
Actual capital (10K RMB) | 4,734,895 | 4,625,860 | |
Tier 1 core capital (10K RMB) | 3,734,895 | 3,625,860 | |
Tier 2 core capital (10K RMB) | - | - | |
Tier 1 supplement capital | (10K RMB) | 1,000,000 | 1,000,000 |
Tier 2 supplement capital | (10K RMB) | - | - |
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IV. Required capital
As at the end of this
Item
quarter
As at the end of last quarter
Required capital (10K RMB) | 1,624,844 | 1,618,550 | ||
Required capital for quantitative risks (10K RMB) | 1,648,583 | 1,642,198 | ||
1）Required capital for insurance risk | (10K RMB) | 1,236,265 | 1,256,805 | |
2）Required capital for market risk (10K RMB) | 325,111 | 317,141 | ||
3）Required capital for credit risk | (10K RMB) | 617,137 | 580,974 | |
Required capital for control risk | (10K RMB) | -23,740 | -23,648 | |
Supplement capital (10K RMB) | - | - | ||
1）Counter-cyclical supplement capital | (10K RMB) | - | - | |
2）Supplement capital of D-SIIs | (10K RMB) | - | - | |
3）Supplement capital of G-SIIs | (10K RMB) | - | - | |
4）Other supplement capital (10K RMB) | - | - | ||
V. Integrated risk rating (IRR)
The Company was rated B in IRR for both Q1 and Q2 of 2019.
VI. Risk management status
(I) The latest CBIRC solvency risk management assessment of the Company
In 2018, CBIRC conducted Solvency Aligned Risk Management Requirements and Assessment (SARMRA) of the Company, and the result was 82.88 points: 16.73 points for risk management infrastructure and environment, 7.55 for risk management objectives and tools, 8.60 for insurance risk management, 8.32 for market risk management, 8.38 for credit risk management, 7.66 for operational risk management,
8.68 for strategic risk management, 8.28 for reputation risk management, and 8.68 for liquidity risk management.
- Measures taken to improve solvency risk management and the latest results in the reporting period
During the quarter, the Company took the following steps to further improve the objectives and tools of risk management systems, management of insurance risk and early-warning and screening of major risks.
First, it enhanced risk management emergency response mechanisms: formulated and issued Regulations on Emergency Reporting based on the Company's realities and Provisions on Emergency Reporting of the Banking and Insurance Industries by CBIRC, in a bid to strengthen risk prevention and mitigation, as well as reporting of emergent and unexpected incidents.
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Second, it improved insurance risk management: amended business processes for reinsurance, optimized business management rules for health and import duty surety insurance in compliance with solvency risk management requirements.
Third, it stepped up early warning and screening of major risks: closely monitored developments of material adverse events such as the supply chain financial risk of Noah Group, P2P defaults which involved certain insurance companies and other risks on the credit market, and issued early warning within the organization promptly; paid close attention to risks relating to P2P loans and organized multiple campaigns for risk screening including the screening of insurance risk relating to anti-povertymicro-loans, investments on P2P platforms and financing trade.
VII. Liquidity risk
(I) Liquidity risk management indicators
(1) Net cash flow
Item | During/as at the end | ||||
of this quarter | |||||
Net cash flow (10K RMB) | -106,015 | ||||
(2) Comprehensive current ratio | |||||
Item | Within 3 months | Within 1 year | Above one year | ||
Comprehensive | current | 95.6% | 60.4% | 218.4% | |
ratio | |||||
(3) Liquidity coverage ratio
Item | Stress | Stress |
scenario 1 | scenario 2 | |
Liquidity coverage ratio | 518.5% | 333.8% |
(II) Liquidity risk analysis and mitigation
- Cash flows
In this quarter, net cash outflow of the Company was RMB1.06 billion. Of this, cash inflow from primary insurance premiums reached RMB31.88 billion, up 13.1%. Cash outflows from claims payout grew by 11.3% to RMB17.63 billion. Net cash flow from business activities in this quarter increased by RMB340 million from the previous quarter.
Net cash inflow from the Company's investment activities was RMB620 million, mainly
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due to asset allocation in bank deposits, bonds and equity securities.
Net cash outflow from the Company's financing activities was RMB3.73 billion, mainly as a result of allocation in financial assets repurchase and payment of shareholder dividend.
(2) Liquidity indicator analysis
The Company has allocated a certain proportion of highly liquid assets in its SAA to meet liquidity requirements. Therefore, its liquidity coverage ratio is 518.5% and 333.8% under stress scenario 1 and 2 respectively in the next quarter, enough to meet short-term cash flow requirements.
To mitigate liquidity risk, the Company attaches importance to daily cash flow management, coordinates cash flows from business, investment and financing activities to ensure sufficient liquidity to meet needs of surrenders, claims and other benefits payments. It will continue to monitor changes to its liquidity status and enhance risk management capabilities.
VIII. Regulatory measures taken against the Company
(I) Regulatory measures taken against the company by CBIRC
None.
(II) Corrective measures taken by the Company
None.
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Disclaimer
China Pacific Insurance (Group) Co. Ltd. published this content on 30 October 2019 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 October 2019 14:36:02 UTC
