Insurer wins approval to boost banking unit By Zhang Fengming
PING An Insurance (Group) Co has received regulatory approval to buy Ping An Bank and merge it with Shenzhen Commercial Bank in a move that beefs up the financial services strength of China's second-biggest insurer.
The China Banking Regulatory Commission approved a plan to allow Ping An Insurance to take over the Shanghai-based Ping An Bank through its Shenzhen Commercial Bank, Ping An Insurance said in a statement to the Shanghai Stock Exchange yesterday.
Under the plan, Shenzhen Commercial Bank sought to acquire a 27 percent stake in Ping An Bank from HSBC for US$29.4 million and pick up the rest from Ping An Trust & Investment, a subsidiary of Ping An Insurance, the Shenzhen-based insurer said.
The two banking arms will be merged and renamed Shenzhen Ping An Bank Co, which will operate a network of about 50 outlets in Shenzhen, Shanghai and Fuzhou.
The merger also enables Ping An Bank, formerly a Sino-foreign joint venture, to offer unlimited retail yuan services to Chinese.
Ping An bought 89 percent of Shenzhen Commercial Bank for 4.9 billion yuan in July 2006, gaining 46 branches in the southern Chinese city and a credit-card license.
Sun Jianyi, executive deputy general manager of Ping An Insurance, said last year that the insurer's banking strategy is to create a single-brand lending business.
Ping An Insurance is gearing up to build itself into a Chinese version of rivals such as Citigroup Inc by offering a full range of financial services, including banking, insurance and assets management.
Ping An Insurance said in March that it had gained a license to run an assets management firm in Hong Kong as the group's overseas investment arm.
Ping An expects to get two-thirds of its revenue from banking, securities and asset management in the long run, compared with about 10 percent at the end of last year.
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