HK Stock Market Move | Non-life insurance stocks strengthened in the morning; the pilot program for equity investment by financial asset investment companies will be further expanded; the advantages of long-term investment of insurance funds are significant.

In the morning, insurance stocks strengthened. New China Life Insurance (01336) rose by 4.16% to 27.55 Hong Kong dollars, CHINA TAIPING (00966) rose by 3.99% to 11.98 Hong Kong dollars, AIA (01299) rose by 3.68% to 63.4 Hong Kong dollars, and Ping An Insurance (02318) rose by 3.44% to 48.05 Hong Kong dollars. On the news front, on March 5, the China Banking and Insurance Regulatory Commission issued a notice regarding further expanding the pilot program for financial asset investment companies' equity investments. By September 2024, the regulatory commission expanded the pilot program from Shanghai to 18 cities including Beijing, and included it in a package of measures to stabilize economic growth. It has achieved full coverage signing in 18 cities, with signed amounts exceeding 350 billion yuan, producing positive results. Based on the summary of the pilot program experience, the regulatory commission issued a notice to further expand the pilot program in three areas. Among them, it supports insurance funds to participate in the pilot program for financial asset investment companies' equity investments. The notice specifies support for insurance funds to legally and compliantly invest in private equity investment funds issued by financial asset investment companies through subsidiary institutions, bonds issued by financial asset investment companies, or to take shares in financial asset investment companies. This is beneficial for leveraging the long-term investment advantages of insurance funds, broadening the sources of funds for equity investment pilot programs, and further enriching the diversified financing system for technology companies. Ye Huaibin, a researcher at the Bank of China Research Institute, stated that the expansion of the pilot program for financial asset investment companies in the notice is an important measure for making major advancements in science and technology finance, and also helps banks and insurance institutions play a positive role in the venture capital market. Banking financial institutions are an important part of China's financial system, with their assets accounting for over 90% of total financial institution assets. Expanding the pilot program with financial asset investment companies as the main players helps fully utilize the rich customer resources and risk control experience of the banking system, increasing the probability of venture capital success.