Ping An gets regulatory approval for its listing
Ping An Insurance, China's second-largest life insurer, is a step closer to its planned US$1.5 billion overseas listing after the securities watchdog approved its initial public offering, according to sources.
China Securities Regulatory Commission approval is a prerequisite for all mainland companies seeking offshore listings.
Ping An was expected to move on to the final stage of the process in Hong Kong - a listing hearing - next week, the sources said.
However, the initial public offering comes as equity markets are souring amid concerns that the United States Federal Reserve could raise interest rates soon.
Global investors have also been spooked by revelations of accounting irregularities at China Life Insurance, which listed in Hong Kong last December.
Ping An's officials could find it hard to convince investors that it is different from its fellow insurer.
Ping An was selling about 25 per cent of the company in the listing, sources said.
Unlike China Life, where the parent took on huge loss-making policies sold between 1993 and 1999 at a time of high guaranteed rates paid by insurers to policyholders, Ping An would retain its loss-making policies in the listed company, apparently removing future concerns over repayments.
The sources said these policies were not huge compared with its portfolios.
