- Qianhai Insurance has increased its stake in the Bank of Zhengzhou (6196.HK) by 4.1%, according to Sina.
- The market value of the insurance company’s holding now amounts to HK$ 1.08 billion.
Why It Matters:
- The Bank of Zhengzhou is a regional commercial bank with a market capitalization of HK$ 26.4 billion. By the end of June, the bank posted a net profit of RMB 2.1 billion and it had total assets of RMB 315.8 billion.
- Qianhai Insurance is building a financial conglomerate, and it currently still lacks a banking licence. Controlling a commercial bank, or participating with one, can help the insurance company access low cost deposits and secure credit offerings in emergency situations.
- The China Insurance Regulatory Commission (CIRC) is conducting investigations into Qianhai Insurance, but purchasing stocks in the Hong Kong market can bypass the regulator’s scrutiny.