China Life says A-share downturn to continue; confident in long term

Tue. August 26, 2008; Posted: 01:18 AM

BEIJING, Aug 26, 2008 (XFN-ASIA via COMTEX) -- LFC | Quote | Chart | News | PowerRating -- China Life Insurance Co (SHA 601628; HK 2628), the country's largest insurer and institutional investor, the A-share market's prospects for the rest of the year remain clouded, although it remains confident about its performance over the long term.

Liu Jiade, a China Life vice president, said at a media briefing that negative impact of the US subprime crisis on global financial markets will play out some time longer, leading to more volatility in the A-share market.

"However, we cannot judge a stock market over a period of just half an year or one year. The A-share market will be in an uptrend over the long term, with the fundamentals of China's economy remaining strong," Liu said.

China Life announced late yesterday that first-half net profit fell 32 pct to 15.84 bln yuan, mainly due to the downturn in capital markets during the period.

The benchmark index in Shanghai fell about 48 pct during the period.

China Life said it reduced investment in equities to 13.28 pct of its portfolio at the end of June from 22.95 pct at the end of December.

Separately, Liu Lefei, China Life's chief investment officer, told reporters that overseas investment opportunities are emerging with recent plunges in international markets.

"We will keep in active touch with potential targets but will be prudent before making any decisions," he said, without elaborating.

Liu Jiade added that the insurer will target financial companies when it decides to make a foreign acquisition.

(1 usd= 6.8 yuan)

allen.shu@xfn.com

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For full details on China Life Insurance Company Limited ADS (LFC) click here. China Life Insurance Company Limited ADS (LFC) has Short Term PowerRatings of 6. Details on China Life Insurance Company Limited ADS (LFC) Short Term PowerRatings is available at This Link.

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