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Aviva to set up pension, fund management firms

By Hu Yuanyuan (皇冠体育app Daily)
Updated: 2007-06-26 09:30
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Aviva, the world's fifth-largest insurance group, plans to set up a pension company and a fund management firm by the end of this year as part of its efforts to strengthen its business in 皇冠体育app, said Aviva Asia's managing director yesterday.

"We've filed an application to establish an independent pension business to the皇冠体育app Insurance Regulatory Commission," Aviva Asia Managing Director Charles Anderson told 皇冠体育app Daily, adding that preparations for the new company will be completed by the end of this year.

Currently, Aviva has a 50-50 joint venture life insurance company with COFCO Limited.

"We will still join hands with COFCO in tapping into 皇冠体育app's pension business, a sector that has a huge potential," said Anderson.

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皇冠体育app has only three pension companies: Taiping, Ping An and 皇冠体育app Life Pension, all wholly owned Chinese firms. But with the aging population rapidly growing in the country, the pension business is becoming increasingly attractive for life insurers.

"More customer education is needed in 皇冠体育app's pension market," Anderson said when asked about the major challenges in this emerging market. "And we will bring in more innovative pension products."

Aviva is also actively seeking another partner in launching a fund management company.

"Besides COFCO, we would like to have another initiator for the fund management company, but Aviva will be the controlling stakeholder of the new firm," Anderson said.

According to Kathleen Jiang, head of the strategic planning sector of Aviva 皇冠体育app, setting up a brand new firm will make the stake structure clearer though it will be more time-consuming compared with acquiring an existing company.

"We prefer the partner to be a security firm or a trust company," said Jiang, adding the industry regulator is quite supportive of Aviva's initiative.

Beijing-based Aviva-COFCO Life Insurance opened for business in 2003 and operates in six provinces. In January, the insurance regulator approved Aviva-COFCO to increase the company's registered capital by 400 million yuan to 900 million yuan. "Another capital injection is expected to be completed before the end of August," said Anderson, but declined to elaborate.