Recently, a number of rating agencies have successively released the 2022 Insurance Agency Tracking Rating Report.The report shows that many insurance companies are under pressure to continue to replenish capital.
According to statistics from public information, in the first half of this year, 9 insurance companies successfully issued capital supplementary bonds, totaling 21.15 billion yuan; 13 insurance companies supplemented capital by increasing capital, including shareholder capital increase and introduction of strategic investors Capital increase, and capital increase through undistributed profits.
On the whole, in the first half of the year, the total capital replenishment of insurance companies exceeded 50 billion yuan, and there are still many capital replenishment plans that have been announced but have yet to be implemented.Industry insiders believe that the capital replenishment level of insurance companies is expected to remain at a high level in the second half of the year.
Strong capital needs of insurance companies
Adequate capital is one of the core elements for insurance companies to ensure sufficient solvency and business development.Since the beginning of this year, insurance companies' demand for capital has continued to remain high, and some insurance companies have shown obvious pressure on their solvency.
Xu Yuchen, a founding member of the China Association of Actuaries and a senior actuary, told the "Securities Daily" reporter that as the business scale of insurance companies grows, they need to increase capital to ensure the solvency adequacy ratio; at the same time, this year, with the second phase of the C-ROSS project The implementation of the solvency adequacy ratio of many insurance companies has declined, and insurance companies also need to supplement capital.
Taking a life insurance company as an example, Lianhe Credit pointed out in the rating report that this year, the continuous development of the company's business has increased the consumption of capital. At the same time, under the second phase of the C-ROSS project, the definition of core capital is more Strict, so that its core solvency adequacy index has dropped significantly, and it will face certain pressure on capital replenishment in the future.The report shows that at the end of each year in 2019, 2020, 2021 and the end of the first quarter of this year, the company's comprehensive solvency adequacy ratios were 174.91%, 158.28%, 144.79% and 141.63%, respectively, and the core solvency adequacy ratio was 143.33%. %, 132.52%, 109.47% and 70.81%.It can be seen that the company's solvency adequacy ratio is in a downward trend.
At the same time, at the end of the first quarter of this year, the core solvency adequacy ratio of another life insurance company was 97.79%, down 26.82 percentage points from the end of the previous year; the comprehensive solvency adequacy ratio was 147.69%, down 6.67 percentage points from the end of the previous year."At this stage, the company's solvency has met the regulatory requirements but is at a low level, and the continued development of its business in the future will put the company under pressure to replenish capital," China Chengxin International said in the report.
The Lianhe Credit Report pointed out that Caixin Jixiang Life "with the continuous development of insurance business and investment business, the company's core solvency level has dropped significantly, and there will be great pressure on capital replenishment in the future".
Since the beginning of this year, the second phase of C-ROSS has been fully implemented in the insurance industry. Under the new regulatory rules, the solvency adequacy ratio of insurance companies has generally declined, and some insurance companies have applied for transitional policies.At the same time, the China Banking and Insurance Regulatory Commission recently issued a notice to conduct regulatory assessments on solvency risk management capabilities for 70 insurance companies.The solvency risk management system of insurance companies is facing stricter scrutiny. On the whole, the insurance industry's demand for funds continues to be strong.
Combat in a variety of ways
In order to improve the solvency adequacy ratio, insurance companies actively replenish capital in various ways.In addition to the two more common ways of issuing bonds and increasing capital by shareholders, there are also insurance companies that replenish capital by converting undistributed profits into capital or converting discretionary surplus reserves into shares.Industry insiders believe that this shows that some insurance companies have improved their "self-hematopoietic" function.
From the perspective of bond issuance, according to public information statistics, a total of 9 insurance companies successfully issued capital supplementary bonds in the first half of this year, with a total of 21.15 billion yuan.Among them, Taiping Life Insurance and ICBC-AXA Life Insurance each issued bonds of 5 billion yuan; PICC Health and National Property Insurance each issued bonds of 3 billion yuan.In addition to the bonds that have been issued, more insurance companies have released bond issuance plans in the first half of the year but have not yet "implemented". For example, PICC plans to issue 18 billion yuan of capital supplementary bonds, and New China Insurance plans to issue 20 billion yuan of capital supplementary bonds.
The coupon rates of capital supplementary bonds issued by different insurance companies are quite different.For example, the highest coupon rate is 6.25%, the second is 5.50%, and the lowest is 3.45%.An analyst believes that this is mainly due to differences in the nature of companies and business quality among issuers.
Judging from the bonds issued by the same insurance company at different times, the current interest rate has declined compared with the previous one.For example, CCB Life will issue bonds of 6 billion yuan in 2021 with a coupon rate of 4.3%; in March this year, it issued bonds of 2 billion yuan with a coupon rate of 3.7%.At the same time, China Merchants Renhe Life issued bonds of 1 billion yuan each in June and November last year, with a coupon rate of 4.9% and 4.8%, respectively. In June this year, it issued bonds of 1.1 billion yuan, and the coupon rate further fell to 4.3%.The above-mentioned analysts said that this is mainly affected by the market interest rate. Generally speaking, the coupon rate is positively correlated with the market interest rate.In addition, the current downward trend in market interest rates is also one of the reasons for the lower interest rates on newly issued bonds.
From the perspective of other capital replenishment methods, on April 17, Ping An Pension announced that in order to ensure solvency and support business development, it plans to apply to shareholders for a capital increase of 10.52 billion yuan. After this capital increase, its registered capital will increase by about 4.594 billion yuan. Yuan.Shareholders' capital increase is also a common method of capital increase used by insurance companies, but on the whole, the difficulty of shareholders' capital increase has increased in the past two years.
Xu Yuchen believes that some shareholders have limited cash flow due to various reasons, and may be "intentional and powerless" to increase capital, and some shareholders may be cautious in their expectations for the development of the insurance industry, and their enthusiasm for capital increase will also be affected.
It is worth noting that this year, there are also insurance companies that have used a less common method of capital increase.For example, Yingda Taihe Property Insurance converted undistributed profits into capital, increasing its capital by 3.5 billion yuan. After the conversion, its registered capital increased to 6.5 billion yuan; CPIC Property and Casualty converted its discretionary surplus reserve into share capital, with a total of 4.78 million shares. 100 million shares, with a total amount of about 1.2 billion yuan.This method of capital increase is considered to be "self-hematopoiesis" in the industry, which is one of the manifestations of the company's benign development stage.
Xu Yuchen said that to improve the "self-hematopoietic" function of insurance companies, on the one hand, they should improve the quality of the business side and improve the underwriting profit. On the other hand, on the investment side, they should combine the new solvency regulations to reduce the consumption of capital.
Our reporter Leng Cuihua
(Editor in charge: Jiang Ninglu)
