Ping An's profits fall sharply as pandemic hits new business

[BEIJING] Ping An Insurance (Group) of China on Thursday reported a 29.7 per cent fall in first-half net profit compared with the same period the year before, its biggest drop in more than a decade as the coronavirus pandemic hit new insurance sales.

Ping An, the only Asian insurer deemed globally systemically important by regulators, said its net profit was 68.68 billion yuan (S$$13.6 billion) for the six months to June, according to a filing with the Hong Kong stock exchange on Thursday.

That compares to 97.68 billion yuan over the same period in 2019, which marks the biggest drop in first-half earnings since at least 2008, when they fell 11.9 per cent in the first half of that year, Reuters calculations showed.

"So far 2020 has been challenging, having witnessed a complex fast-changing macro-environment, the dramatic impact of Covid-19, and highly volatile global markets," Ping An said in its interim report.

Though the disruption of travel during Covid lockdowns had a positive impact on auto claims, the company said.

Gross written premiums at Ping An Insurance fell 0.2 per cent year-on-year to 445.5 billion yuan in the first six months of the year, while the number of retail customers increased 4.6 per cent from the beginning of 2020 to 210 million.

Investment income fell 16.7 per cent to 78.21 billion yuan with a 1.1 percentage point cut in annualised yield, driven by "sharp year-on-year capital markets fluctuations", the company said.

Ping An's banking business, posted a 11.2 per cent fall in profit in the first half from last year as it boosted loan loss provisions.

REUTERS