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Ping An profits down in H1, but P&C growth stable

28th August 2020 - Author: Matt Sheehan

Ping An Insurance (Group) Company of China, Ltd. has reported a 28.2% decrease in net profit over the first half of 2020, partially offset by continued stable growth in its property and casualty (P&C) segment.

Ping An insurance logoNet profit came to RMB 75.97 billion (USD 9.07 billion) for the six-month period, while operating profit increased by 1.2% year-on-year to RMB 74.31 billion (USD 10.82 billion).

In contrast, Ping An’s P&C business maintained stable growth and better-than-industry business quality in H1, expanding its premium income as well as market share by 10.5% and 0.5 pps year on year, respectively.

Overall combined ratio rose by 1.5 percentage points year-on-year to 98.1% driven by a short-term increase in guarantee insurance claims paid, resulting from COVID-19.

But operating profit for the P&C segment declined by 17.6% year on year to RMB 8.27 billion. Annualized operating ROE was 17.2%.

Ping An’s investment portfolio of insurance funds rose by 7.3% to RMB 3.44 trillion, as of June 30, 2020, with 17.2% of these assets marked to market through the profit and loss under IFRS 9.

The company noted that it secured its portfolio by taking measures to lower investment risks, which enabled it to generate an annualized net investment yield of 4.1% and an annualized total investment yield of 4.4% over H1.

Looking at life and health business, operating profit after tax rose by 6.4% to RMB 51.54 billion, with a 39.2% annualized operating ROE.

With the impacted of the COVID-19 epidemic, new business value (NBV) of the life and health insurance segment decreased by 24.4% to RMB 31.03 billion.

Retail customer development also continued to yield strong results for Ping An, with retail customers increasing by 4.6% from the beginning of 2020 to 210 million.

In the first half of 2020, Ping An acquired 18.09 million new customers, of whom 35.4% were sourced from internet users of the group’s five ecosystems.

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