China Life buys bank stakes
China Life Insurance Group Co. acquired a 1.75% stake in Industrial Bank Co. for 392.5 million yuan, as a move to search for higher returns on assets, The Wall Street Journal reported.
China Life, which is the parent of China Life Insuarnce Co., the country's largest life insurer by premiums, purchased the 70 million shares from Guohua Energy Investment Corp. at an auction held in Beijing in June, said the paper, quoting Industrial Bank as saying.
Earlier in the year, China Life moved to join a consortium led by Citigroup Inc. that seeks to buy 85% of Guangdong Development Bank, another southern domestic lender.
Even without the expected synergies, China Life may generate returns by reselling its newly acquired stake in Industrial Bank.