Source: China Times
New China Life Insurance has taken another step in the equity market. Recently, New China Life disclosed a tender offer announcement: after increasing its stake in Guotai Junan H-shares by 995.96 million shares through New China Asset Management, its combined holding with concert parties—New China Asset Management and New China Asset Management (Hong Kong)—rose to 7.1 billion shares, representing 20.24% of Guotai Junan's total H-share capital. This marks the first time in China that an insurance investor has pushed its single-brokerage H-share holding above 20%.
Tian Lihui, a finance professor at Nankai University, told China Times that 20% is a high level in insurance capital share acquisitions. Most acquisitions cluster around 5%, while a few top insurers have reached the 15%-20% range for bank H-shares—a first for broker H-shares. Choosing H-shares over A-shares offers key advantages: significant discounts, higher dividend yields, and smaller floating markets that facilitate strategic positioning, aligning with the "long-term, long-horizon" nature of insurance capital.
Notably, the overall frequency of insurance capital taking significant stakes has declined this year, with only 9 instances recorded. However, equity allocations continue to increase, as funds are shifting from secondary market takeovers toward more diversified approaches such as IPO strategic placements and cornerstone investments.
Year-end stake-raising activity cools down
Exchange filings show that the Xinhua Group steadily increased its stake in Guotai Haitong H-shares starting this year from 5: it crossed 16% on 5/15, 17% on 7/15, 18% on 9/3, and 19% on 9/16, reaching 20% by 9/29. The holding grew from 5.6 billion shares to 7.1 billion shares.
From the transaction details, the increase in holdings on 9/29 was executed by Xinhua Asset Management; Xinhua Asset (HK) did not participate. The funds originated from insurance liability reserves. This purchase involved only 995.96 shares, representing approximately 0.28% of Guotai Haitong's H-share capital. Following this change, the combined holding percentage of the Xinhua group rose from 19.96% to 20.24%. As of 9/29, Xinhua Insurance's book balance for its Guotai Haitong H-shares stood at 89.70 billion yuan, accounting for 0.48% of Xinhua Insurance's total assets as of the end of Q2026.
Xinhua Insurance and Guotai Haitong share a historical connection. Since 2019, Xinhua Insurance has been a major shareholder of Guotai Junan with representation on its board, and it continued increasing its holdings in both companies' H-shares during the merger and restructuring process. Currently, Chen Yijiang, General Manager of Xinhua Asset Management, still serves as a director of Guotai Haitong. In 2024, Xinhua Insurance triggered a mandatory disclosure by increasing its stake in Hui Tong Securities' H-shares in 11. Following the merger of Guotai Junan and Hui Tong Securities, Xinhua Insurance further increased its position, making continuous purchases over several months this year.
Sustained investment requires a strong fundamental foundation. Guotai Haitong was formed by the merger of Guotai Junan Securities and Haitong Securities. As of the end of the first half of 2026, total assets reached 2.5 trillion yuan, ranking first among domestic securities firms. In the first half of 2026, Guotai Haitong generated revenue of 471.63 billion yuan, up 97.56% year-over-year, with net profit attributable to parents of 202.60 billion yuan, up 28.74% year-over-year, setting a new record high for the period.
This marks the second time Xinhua Insurance has triggered a major shareholding disclosure this year. On 9 month 22, Xinhua Insurance increased its stake in AVIC Industry Holdings Limited (H shares) by 1687.6 million shares via centralized bidding on the secondary market, raising its total holding to 5.17% and triggering the disclosure requirement.
However, across the industry, the enthusiasm of insurance capital for block acquisitions has noticeably declined. According to data released by the Insurance Association, as of 10/12, a total of 5 insurance companies carried out block acquisitions this year, with 9 transactions covering 6 listed companies. In contrast, during the same period last year, 13 insurance companies conducted 31 block acquisitions. Zhang Xiaotong, Co-Head Analyst at China Merchants Securities for Non-Banking Finance, stated that the core reason is the high base formed after concentrated allocation of high-dividend assets in 2025, which has narrowed the room for new block acquisitions.
The first major stake acquisition by insurance funds this year occurred in 1. CPIC Life increased its holding in Shanghai Airport by 7242.4 million shares via block trade, raising its total stake with affiliates to 5.00%. Following closely, Ping An Life increased its position in China Life Insurance (H-shares) through Ping An Asset Management, reaching 10% on 2 month 3, and further rising to 15% on 5 month 20. As of 5 month 20, the book value of China Life Insurance (H-shares) held by Ping An Life was 293.57 billion yuan.
Notably, cross-shareholdings among insurers are no longer isolated cases this year. While Ping An Life acquired a stake in China Life's H-shares, products under China Life increased their holdings in China Ping An's A-shares by over 4300 million shares in the first quarter of 2026, becoming its 10th-largest shareholder; meanwhile, two accounts under New China Life Insurance increased their combined holdings in PICC A-shares by over 1900 million shares during the same period. "Insurance buying insurance" has shifted from an isolated incident to a prevailing trend.
As the third quarter begins, the baton of shareholding has passed to smaller and mid-sized insurers. In 7, Fude Property & Casualty and its concert party, Fude Technology, acquired a total of 10% stake in Yakang Shares via agreement transfer for a total price of 2.59 billion yuan. In 8, Lianan Life Insurance agreed to acquire approximately 7375.56 shares of Zhongshan Public Utilities, raising its shareholding to 8.16%. In 9, New China Life Insurance made two moves: first, it increased its holding in AVIC Industry Holdings (H-shares) to 5.17% on 9/22; then, on 9/29, it raised its stake in Guotai Haitong (H-shares) to 20.24%.
Funds have not exited
The frequency of insurance capital's block trades is declining, while equity positions are rising.
Latest data released by the National Financial Regulatory Administration shows that as of the end of Q2 2026, total insurance fund assets reached 40.82 trillion yuan, surpassing 40 trillion yuan for the first time. Investments in stocks and securities investment funds totaled 6.39 trillion yuan, accounting for approximately 15.65% of total assets. This marks the highest level recorded since the regulatory system began publishing such data, with consecutive quarterly growth for 8 quarters. Additionally, as of the end of Q2 2026, the five listed insurers held stock-related assets totaling 2.82 trillion yuan, an increase of over 3000 billion yuan compared to year-end 2025.
Jiang Han, a senior researcher at Pangu Think Tank, told China Business Times that the shift from "raising stakes upon hitting thresholds" to "increasing positions" indicates a change in how insurance capital allocates equity. It's not that they're avoiding stocks, but rather moving away from the single-path strategy of raising stakes the moment certain levels are reached. He noted that last year, insurance funds concentrated heavily on high-dividend assets, setting a very high base. This year, many targets are near key threshold levels like 5% and 10%, so institutions are proactively managing their pace to avoid triggering announcements that could lead to excessive market interpretation.
"A significant amount of capital has shifted from traditional secondary market block trades to IPO strategic placements, HKEX cornerstone investments, and agreement-based transfers. While these moves aren't included in standard block trade statistics, they have genuinely pushed total equity positions to record highs," Jiang Han said.
Zhou Jin, a partner at Tianzhi International specializing in financial services consulting, told this reporter that insurance capital investment strategies have shifted noticeably this year. The hallmark has moved from "blockholdings in the secondary market" to "primary/semi-primary IPO lock-up share acquisitions." Investors are transitioning from "financial investors" to "strategic investors," and their focus is shifting from high-yield bank and infrastructure stocks to hard-tech companies representing new quality productive forces. Consequently, compared to last year, the number of blockholdings in the secondary market has dropped significantly.
In Zhou Jin's view, these changes stem from both internal factors within insurance companies and external environmental conditions. From an internal perspective, the shift toward floating-rate products has reduced short-term pressure on yield targets, allowing insurers to be more patient with early-stage investments while waiting for IPO opportunities to achieve higher long-term returns. Additionally, the strategy of locking prices during IPO book-building helps classify more investments under FVOCI, thereby mitigating profit volatility. Externally, long-term regulatory performance metrics, the opening of listing channels for high-tech firms, and transparent rules for cornerstone investments in Hong Kong IPOs have created a favorable regulatory environment for insurers to adjust their market entry strategies.
"Overall, the positioning of insurance capital as 'patient capital' and its long-term allocation model remain unchanged. Equity holdings continue to increase, the 'fixed income plus' strategy is still being pursued, and the approach of leveraging equity market opportunities to enhance returns has not been adjusted," said Zhou Jin.
