BIZCHINA / Overseas Investment
HSBC to start insurance venture in China this year
(Bloomberg)
Updated: 2006-06-07 15:33
HSBC Holdings Plc, Europe's largest bank by market value, said it'll
start an insurance venture in China by the end of this year, tapping into
a demand by the growing middle class for protection products.
HSBC is setting up the venture with a Chinese company, said Peter Wong,
executive director for Hong Kong and China, on the sidelines of a
conference in Shanghai today. He declined to name the partner.
International companies are competing to get into China's insurance
market, which expanded 14 percent to 493 billion yuan (US$61 billion)
last year, helped by economic growth and an emerging middle class. Urban
households that earn more than 25,000 yuan a year are expected to rise to
215 million by 2015 from 43 million last year, according to a report by
McKinsey & Co. issued earlier this month.
Bank of Communications Ltd, 19.9 percent held by HSBC, isn't
participating in the venture because domestic lenders aren't allowed to
do insurance business in China, Wong said. HSBC would be the only foreign
shareholder in the venture, he said, declining to give more details.
HSBC said last September that it's partnering with Hong Kong's Hang Seng
Bank Ltd., in which it has a 62 percent stake, to invest in a life
insurance venture in China. The bank owns 19.9 percent of Ping An
Insurance (Group) Co., the country's second-biggest insurer.
(For more biz stories, please visit Industry Updates)
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