SourceFlyfishingnearme: Huibao the world

Despite the poor performance of the capital market in 2023, the insurance management industry, which mainly depends on asset management fees, was less affected by market fluctuations, and even reversed the downward trend of the previous two years in 2023, with revenues and profits rebounding. According to Huibao World, 34 insurance asset management companies have a total revenue of 362 in 2023.FlyfishingnearmeWith a total net profit of 15.543 billion yuan, excluding non-comparable data (the incomplete year of postage management in China), the two increased by about 4% and 6% compared with the same period last year.

On the whole, with the help of the advantage of shareholders, the head insurance asset management company has more advantages in the development, not only the large scale of business, but also the strong Matthew effect in net profit. The top three Guoshou Capital Management, Ping an Capital Management and Taikang Capital Management account for 40% of the industry's revenue, while the net profit accounts for almost half of the total.

The release of the new rules on asset management makes the regulatory indicators, business areas, and customer groups of the asset management agencies in various industries getting closer and closer. The so-called big asset management era is even more challenging. It can be seen that about 40% of the companies in the industry have experienced a decline in revenue and nearly half of their profits have declined. The two companies continue to lose money.

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About 60% of the company's revenue and net profit increased compared with the same period last year, with three companies taking half of the industry's profits and four companies' net profits doubling.

Although the insurance asset management companies as a whole seem to have achieved both revenue and profit growth in 2023, the proportion is not high, and the characteristics of development differentiation are obvious: in terms of operating income, a total of 20 have achieved positive revenue growth and 13 have negative growth. The proportion of positive growth is 60.6%; in terms of net profit, 18 are positive, 14 are negative, and the proportion of positive growth is 54.5%. At the same time, there are also companies that continue to lose money. Taiping Capital and Allianz Capital Management continue to lose money, with net losses of 11 million yuan and 45 million yuan respectively in 2023.

It can be seen that the insurance asset management industry is an industry with a strong Matthew effect. As an asset management company under the head insurance company, Guoshou Capital Management, Ping an Capital Management and Taikang Capital Management have a huge scale of asset management by virtue of the advantages of shareholders. it has also brought far more revenue and profits than the same industry, and both revenue and net profits are among the top three on the list. According to the data, the three companies have a combined operating income of 14.635 billion yuan in 2023, accounting for 40.4%, and a total profit of 7.66 billion yuan, accounting for 49.28%, accounting for nearly half of the industry.

At the same time, these head insurance asset management companies occupy a place in the large asset management market, or even rank among the best, relying on strong shareholder resources, as well as the industry's necessary sound investment style and relatively long-term asset allocation strategy. For example, in 2023, Guoshou Asset Management rose to 31st place in the annual global ranking of asset management institutions published by IPE, a well-known international institution, from the previous 38 places. Data show that the company's combined assets under management reached 5.37 trillion yuan in 2023, an increase of 12 percent over the same period last year, while the scale of third-party business reached 720 billion yuan, an increase of 28 percent over the same period last year.

Therefore, under the "Daifei" of its shareholder, China Post Life Insurance, China Post Capital Management, which was approved to open in 2023, can claim to be "a leading insurance asset management company in China". From the performance point of view, China Post Capital Management officially opened on October 27, 2023, and achieved a revenue of 81 million yuan and a net profit of 19 million yuan in about two months at the end of the year.

This is related to the business model of insurance asset management. with the growth of the scale of insurance assets year by year, the insurance asset management industry, which mainly depends on the growth of the scale of management assets to achieve the growth of management fee income.

It is worth noting that apart from these head companies that attract the most attention, there are actually many small and medium-sized companies with outstanding performance. for example, in 2023, four institutions doubled their profits with amazing growth. They are all small and medium-sized insurance asset management companies. They are Yongcheng assets, Great Wall Wealth Management, China re-assets, and Guohua Xingyi Management. Apart from the reason that their small base growth is more obvious, they also focus on strategies to give full play to their strengths and abilities.

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We can't just rely on the "father": small and medium-sized companies accelerate their competition for third-party business, and they need to have out-of-system funds and diversified businesses.

Of the four companies with double profits mentioned above, Yongcheng Asset was the most impressive, with revenue of 217 million yuan in 2023, an increase of 141.11% over the same period last year, and net profit of 116 million yuan, an increase of 286.67%. Of course, this amazing growth rate is related to its small base, but from its specific business ideas, we can also see that it is thinking deeply about the development of small and medium-sized asset management companies in the current large asset management era. we can also see that the small and medium-sized insurance asset management companies represented by it are accelerating the development of third-party businesses that test their business capabilities.

Under the implementation of the new regulations on asset management, the decline of the interest rate center, and the transformation of the economic structure, the development challenge of insurance asset management is coming. Cao Zhiqiang, deputy general manager of Yongcheng Asset (presiding over the work), thinks that it is all the more necessary to vigorously develop third-party business at this time. However, as it lags behind other asset management forces in market-oriented mechanism construction and brand construction, it is more necessary to make clear the strategic precision. The development of Yongcheng assets is to "take the characteristics, products and marketization of third-party business as its core development strategy." According to Cao Zhiqiang, Yongcheng assets has launched its third-party business from serving small and medium-sized insurance companies, and has carried out business cooperation with nearly 100 financial institutions and industrial and commercial enterprises mainly insurance companies inside and outside the industry.

In addition to the development of the same industry, another idea of Yongcheng assets is to tap local demand and actively develop market-oriented business in Ningbo. For example, take the asset custody business as a link to cooperate deeply with Ningbo financial institutions, serve forums such as the "attracting Investment into Ningbo" Promotion Association, and develop financial advisory business in the infrastructure construction of services.

Looking back to the whole industry, in fact, the third-party business can be regarded as a consensus, and it is an important growth point for the insurance asset management industry in the future. According to the China Insurance Asset Management Industry Development report (2023), by the end of 2022, the total amount of funds managed by 32 insurance asset management companies was 24.52 trillion yuan, of which the proportion of insurance funds reached 80.39% (of which 90.85% of the insurance funds in the system and 9.15% of the third-party insurance funds), and 19.61% of the non-industry funds. Non-industry funds are mainly composed of bank funds, basic pensions, enterprise annuities, occupational annuities and other funds. With the steady improvement of the level of fund management, insurance capital has made great efforts to develop third-party asset management business. in the past three years, the proportion of capital sources in the system has declined, while the proportion of non-industry capital sources has continued to rise. among them, the scale of bank funds has increased significantly, accounting for 77.75%.

In addition to the diversification of capital sources, business diversification is also the direction of insurance asset management companies. The main business of insurance asset management companies is divided into two parts: investment banking business and asset management business. The former includes debt investment plan, equity investment plan, asset support plan and insurance private equity fund. The latter includes insurance asset management plan, enterprise annuity business, old-age security, public offering business, third-party asset management business and investment-related insurance management.

Huibao World counted the income of asset management fees disclosed in the annual report of insurance asset management companies. It can be seen that the proportion of revenue from management fees of more and more companies is decreasing. At present, 9 companies are less than 80%. The lowest is Guoshou's alternative investment platform, Guoshou Investment, which is 41.43%. This side proves that the industry is reducing its single dependence on asset management business and striving to expand other business income.

In addition, from a counterexample, Ping an Capital Management, the only company with negative growth in the top three, actually saw a decrease of only 2.59% (86.77 million yuan) in management fee income in 2023. More importantly, it comes from other business income and other income decreased by 116 million yuan and 50.93 million yuan respectively.

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The national development strategy is also the betting direction of head insurance management, looking for a "long-term investment password" from policy opportunities.

Under the background of the current downward interest rate center, fluctuations in the equity market and the reduction of high-quality non-standard assets, the insurance asset management industry is also facing new challenges for development. Jiang Zeshen, deputy director of the Supervision Department of the General Administration of Financial Supervision, believes that the solution is to "unify thinking and action with the spirit and task deployment of the Central Financial work Conference and the Central Economic work Conference."

At the forum on the 20th anniversary of insurance asset management reform and development, Jiang Shen put forward four major development directions in the future, two of which are related to business:

First, we should always adhere to high-quality service to the real economy, actively think about how to give full play to the advantages of long-term and stable funds, and be deeply bound with the strategy of the transformation of the real economy. Do a good job in five major articles: science and technology finance, green finance, inclusive finance, pension finance and digital finance.

The second is to continuously improve the ability of long-term investment, steady investment and value investment, continuously improve the investment management ability of the whole chain, and give full play to the role of long-term capital and patient capital transformation.

Third, actively explore coordinated development with other capital management institutions in the market, based on their respective functional characteristics, and form a competitive and cooperative pattern of organic cooperation, complementary advantages and integrated development.

Fourth, effectively enhance the awareness of compliance, adhere to the risk bottom line, and set an example of law-abiding and compliance management. Strict internal control, form organic checks and balances in the process, strengthen the training and cultivation of employees' compliance awareness and compliance culture, insist on benefit from righteousness, and do not make profits by playing "edge ball" and stepping on "grey areas".

From the public information, we can see that the head insurance management companies are more positive about this. For example, China Life recently issued the insurance industry's first RMB equity fund with the theme of "silver hair industry", with a total size of 10 billion yuan and an initial payment of 5 billion yuan. In fact, this is not only for central state-owned enterprises to improve their political position and play a backbone role in key economic areas, but also for these companies to bet on future development with "real money and silver".

As the largest insurance asset management company in China, Guoshou assets under management exceeded 5.37 trillion yuan in 2023, of which the investment scale of serving the real economy exceeded 3.3 trillion yuan. In the future, the scale of relevant investment will only continue to grow. At the 2024 annual work meeting of China Life Asset Management, Cai Xiliang, deputy secretary of the party committee and president of China Life Group, proposed that "unswervingly follow the road of financial development with Chinese characteristics, actively integrate into the overall situation of development, and strive to do a good job in science and technology finance and green finance", and "seize the policy opportunity to stabilize growth and speed up the strategic investment layout". Yu Yong, vice president of Guoshou asset management (presiding over the work), also made it clear that "insurance asset managers should pay more attention to finding a 'long-term investment password' from the national strategic deployment."

In 2021, PICC assets, the first insurance asset management company in the industry, has begun to reap the fruits. In 2021, PICC assets successfully launched the "Advanced Manufacturing Industry Fund Equity Investment Plan", raising no more than 1.02 billion yuan. It is used to subscribe for the share of the second phase of the advanced manufacturing industry investment fund and invest insurance funds into advanced manufacturing industries, including a number of current industry leading enterprises. For example, United Pictures Medical, which broke the monopoly of China's high-end medical imaging equipment by foreign companies for a long time, was successfully listed in 2022 and continued to grow by double 20% in 2023, with revenue exceeding 10 billion yuan.

In early 2024, Chen Dongsheng, chairman and CEO of Taikang Insurance Group, also said publicly, "Taikang has 3.3 trillion of its assets to invest. in the past, we invested in real estate, urban investment, finance, and consumption. today, we have to change four tracks: dual carbon, science and technology, great health, and consumption," closely following the national strategy.

As Yu Yeming, chairman of Taibao assets, concluded, "the issuance of insurance asset management products also covers transportation, energy, municipal, environmental protection, water and many other fields." Insurance funds are found in major national projects such as the Beijing-Shanghai high-speed railway, the south-to-north water diversion project and the west-to-east natural gas transmission project. " It is certain that with the development of five major financial articles in the future, the insurance asset management industry, which strives to achieve the investment goal of passing through the economic cycle, short-term low waves and long-term absolute returns, also has more opportunities for development.