China Life: Fixed-Income Investment to Continue

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Mar. 23 – China Life Insurance Co., the nation’s largest life insurer by premiums, will continue to put money into fixed-income investments in the midst of a possible interest rate-hike.

China Life Vice President Liu Jiade said fixed-income products, including debt securities and bank deposits, will continue to account for 78 percent of the bank’s portfolio in 2011.

China’s central bank has raised benchmark interest rates three times since October, and analysts across the board expect that there will be many more such interest rate hikes to come as the government struggles to battle inflation.

China Life said that as of December 31, bank deposits accounted for 33 percent of its investment portfolio, up 4 percent from the end of 2009. The percentage of bonds in its portfolio dropped to 46 percent from 50 percent, while stock holdings fell to 7.5 percent from 8.8 percent over the same one-year period.