America - 04/01/11

America (52.6% of asset mix) (with net present value in 1 year) 1. Manulife Financial (MFC) CA$31.4 STRONG BUY 2. Google Inc. (GOOG) US$754.6 BUY 3. Wells Fargo Financial (WFC) US$43.8 STRONG BUY 4. General Electric (GE) US$23.5 => US$25.2 HOLD => BUY 5. TD Bank (TD) CA$92.3 HOLD 6. American Express (AXP) US$48.6 HOLD (pending to update) 7. Suncor Energy (SU) CA$50.0 BUY (pending to update) · Mar 11 major transactions: switch Imperial Oil (IMO) CA$52.0 to Suncor Energy (SU) CA$41.3; add Canadian Pacific CA$61.20; sold TransCanada at CA$39.2 · General Electric may get into lawsuit on Japan’s nuclear crisis. So far, analysts think it is very unlikely for GE to have a high contingency loss. On the other hand, given the fact that lots of people rise concern about the security of nuclear power, Bilibala think GE will receive lots of additional orders · government will not and cannot replace all nuclear plant at once, clearer energy to use are wind & solar, which both will benefit GE · in order to improve security & safety, government need to spend more on existing nuclear plant, which will benefit GE as well · Investors rise concerns on the internal control of Berkshire Hathaway on how Warren Buffett handle David Sokol purchase of Lubrizol stocks in Jan 11 just before Berkshire Hathaway announce to acquire it in Mar 11 & took a capital gain of $3M. To me, even Mr Buffett think Sokol did nothing wrong, as a CEO of a well respected giant corporation, the way he managed this issue should be done better by taking action and disclose it earlier. · As some of you hold RIM (Research in Motion), let me spend some time to share my opinion. · 2010 revenue & profit up 33% & 47% to US$19.9B & US$3.4B compare to last year while net margin improved from 16.4% to 17.1% · According to its own outlook, 2011 revenue & profit will up 41% & 22% to US$28.0B & US$4.2B while net margin will fall from 17.1% to 14.8% (with a estimated 2011 market shares in smart phone of about 15%) · Some analysts said RIM will be the next Nortel Network, Bilibala don’t think that will be the case cuz: 1. RIM’s earning growth is strong, above 20% per year, while price over earnings ratio is just 9, in comparison to Nortel’s tiny earnings and over 100 P/E before it fall, they are totally different 2. RIM has no long term debt, while Nortel had tones!! · Yes, RIM’s growth is slowing down, its profit margin is dropping, but given its P/E ratio at 9, PEG ratio of 0.5. I still think RIM should have potential to climb back to CA$70. Even though I won’t recommend a BUY, but for those who are holding it, Bilibala’s suggestion is to hold till release of 1st quarter (around jun 2011), the price should climb back because I think its earnings will beat expectation. · With more information, Bilibala will revised Manulife Financial’s Japan earthquake impact. · Assume 30,000 death, 80% insurance penetration, 8% market shares, CA$0.5M coverage, 80% loss & found & submitted claims, offset with 10% reserve release, the additional losses set up for the event will be CA$0.7B, less 29% tax rate, after tax impact will be CA$0.49B, while equity market rebound, estimate drop in EPS is about CA$0.3. # Bilibala personally uses fair value @ 2016 to do all investment, however, I think for most small investors, net present value @ 2011 (fair value multiply by discount factor), would be more relevant. · STRONG BUY with NPV over MV above 30% · BUY btw 15% to 30% · HOLD btw (15%) to 15% · RE-RE-RECONSIDER below (15%)

America - 03/25/11

America (53.6% of asset mix) (with net present value in 1 year) 1. Manulife Financial (MFC) CA$31.4 STRONG BUY 2. Google Inc. (GOOG) US$754.6 BUY 3. Wells Fargo Financial (WFC) US$43.8 STRONG BUY 4. General Electric (GE) US$23.5 HOLD 5. TD Bank (TD) CA$92.3 HOLD 6. American Express (AXP) US$48.6 HOLD (pending to update) 7. Suncor Energy (SU) CA$50.0 BUY · Mar 11 major transactions: switch Imperial Oil (IMO) CA$52.0 to Suncor Energy (SU) CA$41.3; add Canadian Pacific C$61.20; add Manulife (MFC) between C$15.8-C$16.2 · Manulife Financial: no revised adjustment on $1.2B reserve change due to Japan earthquake. Claims cost increase as # of death rise will offset by equity market recovered. The actual reserve # may be lesser. · Research in Motion release its 4q10 earnings, above expectation but lower its 1q11 sales, trigger the shares down 11% on Friday. Its blackberry continue to grow in # of sales, however, to lots of individual customers, Apple & Google are a much better choice. Its Playbook launch too late, again, no one think it will win the battle. On the other hand, the share price is just $55, with P/E ratio lower than 9. Is this a opportunity or not? To Bilibala who has already hold Google, I won’t consider it. # Bilibala personally uses fair value @ 2016 to do all investment, however, I think for most small investors, net present value @ 2011 (fair value multiply by discount factor), would be more relevant. · STRONG BUY with NPV over MV above 30% · BUY btw 15% to 30% · HOLD btw (15%) to 15% · RE-RE-RECONSIDER below (15%)

Asia/Europe - 03/25/11

Bilibala Finance’s 7 Top Holding by Region: (with net present value in 1 year) Asia / Europe (46.4% of asset mix) 1. China Mobile (0941/CHL) HK$101.2 STRONG BUY 2. China Life (2628/LFC) HK$43.3 => HK$41.5 STRONG BUY 3. China Construction Bank (0939) HK$9.0 BUY 4. Total SA (TOT) US$61.6 HOLD 5. Siu On Land (0272) HK$6.7 STRONG BUY (pending to update) 6. HSBC Holding (0005/HBC) US$67.3 BUY (pending to update) 7. IFSE A50 China Fund (2823) HK$22.4 STRONG BUY · Mar 11 major transactions: add Honda Motor (HMC) US$36.93; add MTR (0066) HK$29.1; add China Resource Power (0836) HK$13.0 · China Life 2010 earnings up 2.3% to RM$1.19 meet expectation. However, as I kept mentioned, earnings is irrelevant to the valuation of an insurance co. Let’s read those meaningful data · Analysts concerns about loss ratio, let’s look at it 1st, it up 1.5% to 88.5% (mainly because of addition reserve on higher premium) to me, it looks reasonable. Combine ratio up 0.6% to 108.8% (which means every dollar of premium China Life received, it loss about 8.8 cents if excluding investment). Premium earned up 15.6% to RM$318B while value of business up 22.5%, looks great with strong growth. Sales to VNB up by 3.2% to 16.2 times, VNB up slightly slower than premium growth · Future sales growth continue looks great, as interest rate continue to go up while equity market is recovering and should back to peak in 10 years, China Life is in nice growing pace · Embedded value up 4.9% to RM$10.6 & based on all estimation & assumption, I will calculate China Life’s value at 4.05 times of its embedded value & discounted by 25.3% (instead of 21.6% previously) to come up with Bilibala’s new NPV of HK$41.5. · Japan Economy: Japan 1q11 GDP for sure will be hurt by the earthquake & the fall of the national electricity capacities, but most of the analysts think it will pick up in 3q & 4q (Bilibala think it will pick up even earlier than that) · Japan government estimate the damage will be US$0.3T and death may end up close to 30,000. · Bilibala believes in Keynesian Economic Theory, the damage may help Japan to have more meaningful & useful construction development. Given the following fact: 1. Japan’s debt will top 213% of total GDP (after counting the damage, the highest among G7), however, its net debt is only 120% (similar or bit lesser than the PIIGS), 94% of all debts are holding within Japan (means the government do not have interest rising pressure from foreign investors nor force to cut expenditures). 2. Also, Japan’s citizens are rich, having US$14T saving, while there are only US$7T government debt. Meaning Japan still have room to borrow from its nation to spend in order to boost up economy 3. In normal time, Japan can’t change much, where’s now, I hope the government will be able to try something “new”, instead of holding the money supply tie to control inflation, it should let inflation grow a bit to stimulate consumption and economic activities · Corporation like Automotive Toyota, Honda, Nissan etc, lol, you may think they are in big trouble cuz few of their plants have been damaged badly. Production line stopped till end of march, may affect global auto sales. But is it really bad for Japanese auto makers? Think again!! 1. insurance will compensate all the damage in the plants 2. parts can be produced in all other unaffected plants around the world 3. while lots of cars are total loss, people have to buy brand new cars in the coming 2-3 years, and they will most likely buy their own nation’s cars · I will talk about the impact to China economy later. # Bilibala personally uses fair value @ 2016 to do all investment, however, I think for most small investors, net present value @ 2011 (fair value multiply by discount factor), would be more relevant. · STRONG BUY with NPV over MV above 30% · BUY btw 15% to 30% · HOLD btw (15%) to 15% · RE-RE-RECONSIDER below (15%)

America - 03/21/11

Bilibala Finance’s 7 Top Holding by Region:
(with net present value in 1 year)
(53.7% of asset mix)
1. Manulife Financial (MFC) CA$31.4 STRONG BUY
2. Google Inc. (GOOG) US$754.6 BUY
3. Wells Fargo Financial (WFC) US$43.8 STRONG BUY
4. General Electric (GE) US$23.5 HOLD
5. TD Bank (TD) CA$92.3 HOLD
6. American Express (AXP) US$48.6 HOLD (pending to update)
7. Suncor Energy (SU) CA$50.0 BUY (pending to update)

· Mar 11 major transactions: switch Imperial Oil (IMO) CA$52.0 to Suncor Energy (SU) CA$41.3; add Manulife (MFC) between C$15.8-C$16.2 add Berkshire Hathaway (BRK.B) US $85.0
· Warren Buffett pull the trigger to buy Lubrizol, a lubricant maker for $9B. Can’t tell whether it is good or not, but global demand on lubricant are rising. Also Berkshire Hathaway held 10% share in Munich Re (10% SwissRe is preferred shares only, will have no impact), It sure took the hit from Japan earthquake

# Bilibala personally uses fair value @ 2016 to do all investment, however, I think for most small investors, net present value @ 2011 (fair value multiply by discount factor), would be more relevant.
· STRONG BUY with NPV over MV above 30%
· BUY btw 15% to 30%
· HOLD btw (15%) to 15%
· RE-RE-RECONSIDER below (15%)

review Manulife on impact due to Japan earthquake

I try not to analysis for terrible events, cuz I think in certain degree that is unethical.
I changed my mind, read details from the following link:
http://bilibala-life.blogspot.com/2011/03/blog-post_16.html

Ok, how’s the earthquake impact Manulife? & is Act of God need to pay claim?

Summary
To me, it is over-react just like what most ppl do in history when bad news happen.
Life insurance need to pay claim for Act of God. P&C insurance may not, depends on the type of policy.

Analysis
Yes, from a growth perspective, Japan’s sales growth is huge in 2010, but from the corporate Japan business is tiny.
Japan’s Premium & Deposit is about 3.5% of the entire corporation (you can’t just look at 1st year premium growth when you calculate the benefit & claims in earthquake)
Japan’s asset under management (included insurance reserve) is about 5.9% of MFC’s AUM - US$28B ($11B in insurance & $17B in variable annuities)

Assume 15,000 dead (+4000 confirmed dead & +9000 missing) with general 8% market shares & 80% insurance penetration and each with a coverage of said C$1M, Manulife may set asided $1.0B addition reserve, after tax, will be about $0.7B.

C$0.7B is about 2.6% of Manulife’s book value while 2011 original estimate earnings after tax are C$2.0B.
Manulife’s book value (before dividend) will still go up by 5.2% to C$28.2B after this addition reserve.

Compare to its share price, down by 8.6% to C$16.0 since the earthquake.

Other concerns
· Since the earthquake has triggered a downside in equity market and a potential slow down in economy in 2011, if market fall 10% (another 5% from today’s), Manulife will loss $0.7B.
· Partially offset by $0.2B on reserve release as government debt interest rate go higher by 20 bps
· Usually, premium & deposit growth rate will go up, lapse rate will go down, claims will go down…..in the next 3 years after earthquake. But I will not take those benefit into account

Conclusion
Overall impact of $1.2B to net earnings or C$0.67 per share.
Bilibala’s previous NPV for Manulife Financial is C$31.4, and based on all the above calculation, it will reduced to C$30.7
If you think that’s too good to be true. Then take the overall wall/bay street 12 month’s target price (which is C$19.27) and reduced by $0.67 will be C$18.6 (around 15% above current market value).

PS:
In theory the nuclear plant keep cooling down every second, right at this moment, the situation still ok, and market will rebound soon. What if the nuclear plant finally & completely meltdown? It is not the meltdown ppl worry, but the worry trigger the hearts & the market to meltdown, until either 1) the nuclear plant really meltdown; 2) it's under control. Either way, the market will recover (a lot greater & much more supportable if it is under control).

Top holding in Asia/Europe 12/23/10

1. China Mobile (0941/CHL) HK$96.4 BUY
2. China Life (2628/LFC) HK$41.1=> HK$43.34 BUY => STRONG BUY
3. China Construction Bank (0939) HK$8.97 BUY
4. Total SA (TOT) US$61.64 BUY
5. Siu On Land (0272) HK$7.4=>HK$6.73 STRONG BUY

• China Life Share price fall mainly due to China stock market, however, premium up 19% in 2010, market shares kept at around 40%, new business value remain highly profitable, interest rate trend is favorable to China Life.
• There are potential 1-2% interest rate rise in China next year, therefore, I’ve readjusted China Life & Shiu On Land’s NPV to reflect such impact.

Top holding in Canada 11/09/10

1. Manulife Financial (MFC)
2. TD Bank (TD)
3. Imperial Oil (IMO)
4. Shoppers Drug Mart (SC)
5. Trans Canada Pipeline (TRP)

• C$ is at par, but I don’t think it will rise further beyond $1.02, as overnight interest rate will most likely keep at 1.0% and the higher the C$ will hurt international trade between US & Canada;
• Wewill have the Shoppers Drug Mart’s 3q10 result this week;
• Manulife Financial: 3q10 result is $1.1B lower than Bilibala’s expectation, cuz it wrote off $1B goodwill in related to its USA insurance business (no way I can’t guessitmate this kind of management decision. It is non-recurring, so, who cares!!). Overall, as interest rate start rising thx to the QE 2.0, Manulife’s performance for future quarters should look better.
  Manulife has 3 major shift in its business model:
  1. diversify by expand its asset management business;
  2. de-equity risk by increase hedge & reinsurance to 50%;
  3. de-interest rate risk by higher duration of its bond holdings.
  From a risk management view, I think it will provide a much smoother quarter to quarter results. However, from a business view, this is not a smart move:
  1. as we all know interest rate will go up eventually, instead of go down
  2. equity market will go up when it was at the bottom (in 2009)
  why should anyone earn less just to smooth things out? Just follow the crowd? Anyway…..

Top holding in Asia/Europe 11/01/10

1. China Mobile (0941/CHL)
2. China Life (2628/LFC)
3. China Construction Bank (0939)
4. Shiu On Land (0272)
5. HSBC (0005/HBC)

• China Life: premium up 23% vs 3q09, total assets up 4.0% vs 2q10 while equity up 7.7% vs 2q10, as Shang Hang A stock break through 3k pt & interest rate up 25 bps, I think China Life will continue to increase shareholders equity value in 4q10 and so on, regardless of how much the reported net income is. In terms of stock value, I think today’s price is quite reasonable, not in big sales.
• China Construction Bank: results look awesome!! I still haven’t completed the trend analysis, will let all u know. It rise 13% from the day I came back to Canada, price over book rise to 2.43 and estimate price over earning rise to 10.1. um…………..still look reasonable but not in big sales.
• Bilibala will sold BYD Ltd. (not a wise decision to invest at 1st place, not cuz it is not good, but cuz I am not that familiar about the company plus I am worry commodity & labour cost will rise at least 10% per year which will hurt BYD’s earning) & invest more Shiu On Land today.

Manulife Buys JV in China

Bilibala: insurance company face aging problem, on the other hand, aging will give opportunity for asset management, that's why Manulife keep acquire aum business in the world.

http://www.benzinga.com/208438/manulife-buys-jv-in-china-analyst-blog
Posted on 04/06/10 at 9:45am by Zacks

Last week, Manulife Financial Corporation (MFC) completed the deal to buy Fortis Bank SA/NV's 49% ownership in ABN AMRO TEDA Fund Management Co. Ltd. The remaining 51% ownership is owned by Northern International Trust, part of Tianjin TEDA Investment Holding Co. Ltd. The deal pertains to MFC Global Investment Management, the asset management division of Manulife Financial.

The new joint venture has been renamed Manulife TEDA Fund Management Company Ltd. It will continue to provide traditional retail and institutional asset management services for clients across the Chinese market. As of Dec 31, 2009, Manulife TEDA's assets under management were RMB 30 billion (US$4.4 billion). This represents a 45% increase from the prior year level. The transaction has received the necessary regulatory approvals.

The agreement to purchase the fund management joint venture in China was announced last November. At that time, Manulife said that the purchase was for a cash consideration of €105 million (US$156 million). The acquisition is expected to be accretive to Manulife Financial’s earnings in the first year and would have a negligible impact on capital levels.

The asset management and insurance market in China is attractive to investors for its growth potential. Manulife Financial is also growing its insurance business in China through Manulife-Sinochem.

Manulife-Sinochem is a joint venture company between Manulife (International) Limited (51%) and China Foreign Economic and Trade Trust & Investment Company, a member of the Sinochem group (49%).

Manulife-Sinochem, which began operations in Nov 1996, was the first Chinese-foreign joint-venture life insurance company established in the country. The company currently serves over 500,000 customers in 41 cities across China through approximately 11,000 professionally trained staff and agents.

Manulife's fourth-quarter earnings of 48 cents per share were below the Zacks Consensus Estimate of 51 cents. The miss was driven by mark-to-market adjustments in real estate investments, model refinements to actuarial liabilities and tax adjustments.

However, the company benefited from equity market appreciation and increases in corporate bond yields. In addition, we think that such an expansion drive will considerably add to Manulife's scale and strengthen its position globally in the foreseeable future.

Shares of Manulife Financial increased 36 cents or 1.83% to $20.05 during the regular session on the New York Stock Exchange last Thursday.

AEGON restructure

Bilibala: pray that my company will not put my division on sales la.

Posted on 04/05/10 at 1:30pm by Zacks

Keeping pace with its ongoing restructuring program that began in 2009, Aegon NV (AEG) announced the sale of its funeral insurance business in Netherlands. Although the sale took place on Feb 1, 2010, it was announced on Friday. The company’s insurance unit has been disposed off to Egeria, a Dutch investment firm for €212 million.

The decision of vending off the funeral insurance business was in line with the Aegon’s strategy of reorganizing its product portfolio and getting rid of the problematic units. In February 2009, Aegon disposed off its institutional spread-based business in the U.S.

The runoff will significantly reduce the company’s exposure to credit risk and help lessen overall sensitivity to fluctuations in financial markets. We believe the sale is expected to have a positive effect on Aegon’s excess capital position and is projected to result in a modest book gain in the first half of 2010.

As such, the company has also been laying off a substantial number of its employees in order to rightsize its operations in the Netherlands. As a result, Aegon’s total workforce declined 7% in 2009 to just over 25,000 employees, mainly due to restructuring in the U.S. and the U.K., as well as the sale of real estate brokerage activities in the Netherlands and life insurance operations in Taiwan.

Earnings Highlights
On Mar 29, Aegon reported the filing of its Annual Report on Form 20-F for the year 2009 with the U.S. Securities and Exchange Commission (SEC). Accordingly, Aegon reported fourth quarter net income of €393 million, which came in substantially ahead of the net loss of €1.18 billion recorded in the year-ago quarter. The significant swing was primarily the result of improved earnings, realized gains on investments and lower impairments.

During 2009, the company realized cost reductions of €250 million, significantly ahead of the target of €150 million. Excluding the impact of restructuring charges, increased employee benefit expenses in the U.S. and currency movements, operating costs decreased in 2009 by 5% from 2008.

For full year 2009, Aegon’s underlying earnings before tax amounted to €1.2 billion, compared to €1.6 billion in 2008. New life sales declined to €2.0 billion from €2.6 billion in 2008, primarily due to weak market activity based on volatile market conditions.

However, gross deposits increased to €23.6 billion against €22.4 billion in 2008, while revenue generating investments increased to €361 billion against €332 billion in 2008. Capital position remained modestly strong.

Aegon continues to move ahead with its strategic priorities of reallocating capital towards business with higher growth and return prospects, to improve growth and returns from existing businesses and to reduce financial market risk.

MetLife buying AIG's Alico unit

Bilibala: AIG's brand name was totaly distoried during the financial crisis, I don't think is smart to acquire any of its subsidaries. Insurance is a competitive industry, there are almost no product differentiate at all other than the corporate brand value and its credit rating.

Policyholders are willing to pay higher cost of insuruance for a famlious and reliable brand. Once its brand name being distoried, there will be minimum value of new business.

http://www.reuters.com/article/idUSTRE62622120100308?feedType=nl&feedName=usbusinessearly

MetLife said on Monday that it would pay AIG $6.8 billion in cash and about $8.7 billion in equity for its American Life Insurance Co (Alico) unit, confirming an earlier Reuters report.
Founded in 1921, Alico sells life, accident and health insurance as well as retirement and wealth management products in more than 50 countries. The deal will help MetLife, already the largest life insurer in the United States and Mexico, diversify revenue by product, distribution and geography.

MetLife will get a boost in Japan, the world's second-largest life insurance market, which accounted for 70 percent of Alico's pre-tax operating income in fiscal year. Alico will also strengthen MetLife's position in Europe and move it into a top five market position in many emerging markets in Central and Eastern Europe, the Middle East and Latin America.

MetLife expects the deal to increase its 2011 operating earnings per share by 45 cents to 55 cents, excluding one-time expenses of 12 cents. It sees annualized post-tax cost savings of $50 million to $75 million.

"Rarely does one come across a deal that has such a strong strategic fit and is also such a financially attractive proposition," MetLife Chief Executive Robert Henrikson said during a conference call.

Still, such a large deal comes with risks, said Clark Troy, a senior analyst at Aite Group.
Alico's strength in Japan also ties MetLife's fortunes to an aging society with a huge public debt overhang, he said.

"If (Japan) falters or slips back into deflation, MetLife might face challenges growing revenue," Troy said in an e-mail late Sunday, before the deal was announced.

FED PAYDAY
The deal comes after AIG agreed to sell its Asian life unit, American International Assurance (AIA), to Britain's Prudential for $35.5 billion, the largest insurance sector deal ever.

The AIA and Alico deals will allow AIG to repay the U.S. government about $31.5 billion in cash, with more expected as the insurer sells Prudential and MetLife securities over time.

AIG will use the $6.8 billion in cash from the Alico deal to redeem part of the Federal Reserve Bank of New York's $9 billion preferred interest in a vehicle that holds the unit.

The proceeds from the two deals should help AIG pay down all of its Fed debt, but it will still leave the government holding roughly $47 billion in equity investments, including the amount drawn under a $30 billion equity line. The government will still have a nearly 80 percent stake in AIG.

To untangle itself from AIG, the government is likely to follow a strategy similar to what it has used with Citigroup Inc (C.N) in a process that will probably take years.

The sale of Alico comes after months of negotiations and became possible after the New York Fed, advised by Morgan Stanley (MS.N), agreed in March 2009 to swap its debt into equity in special purpose vehicles that AIG created to hold AIA and Alico.

Early last year, MetLife offered about $11 billion for the unit, but the price went up in the months after March 2009.

METLIFE STAKE
The equity portion of the price consists of 78.2 million shares of MetLife common stock valued at $3 billion, 6.9 million shares of contingent convertible preferred stock valued at $2.7 billion, and 40 million equity units with an aggregate stated value of $3 billion.

The common stock and equivalents would give AIG a 14 percent ownership in MetLife, MetLife Chief Financial Officer William Wheeler said.

The equity units are set to convert into common shares roughly three years after closing, Wheeler said. Taking those into account, AIG's ownership in MetLife would go above 20 percent, sources familiar with the matter said on Sunday.

But Wheeler said he expected AIG to start selling the shares as soon as it could under a lock-up agreement.

"I am not sure how much shares they will own at any one time, but I suspect it won't get close to 20 percent," Wheeler said.

AIG must vote its shares in proportion to the way the rest of MetLife's outstanding shareholders do, Wheeler said.

MetLife expects to finance the cash portion of the deal with issuances of $3.1 billion in senior debt and $2 billion of common stock, as well as $1.75 billion in cash on hand.

Both boards have approved the transaction, which the companies expect to close by the end of 2010.

Credit Suisse (CSGN.VX) was lead adviser to MetLife, which was also advised by Barclays Capital (BARC.L), Bank of America Merrill Lynch (BAC.N), Deutsche Bank (DBKGn.DE) and HSBC (HSBA.L).

AIG is being advised by Citigroup, Goldman Sachs (GS.N) and Blackstone Group (BX.N), according to several sources.

AIG shares were up 5.3 percent to $29.58, while MetLife was up 5.1 percent to $40.90, both during morning trading on the New York Stock Exchange.

(Reporting by Paritosh Bansal; Editing by Lisa Von Ahn, Dave Zimmerman and John Wallace)

China Life Jan 10 sales up

Bilibala: China Life's sales is growing in a nice double digit pace as the insurance penetration improved, on the other hand, I think the stock price has reflect this growth expectation. Therefore, the future rise will rely heavily on investment performance.

http://www.chinavestor.com/life-insurance/71392-china-life-january-sales-up-14-percent-to-62-billion.html

March 3, 2010 (Chinavestor) China Life Insurance (NYSE:LFC), the largest Chinese life insurer, reported premiums income, or revenue from sale of insurance policies, for the month of January 2010 as follows. Total premiums income from 1 January 2010 to 31 January 2010 was about RMB41.8 billion ($6.119 billion).Given that 2009 January sale of insurance policies was RMB36.6 billion ($5.3579 billion), January 2010 numbers represent an increase of 14.2% from last year data.

Another important development to notice is that January 2010 data is by far the best achieved by China Life Insurance (NYSE:LFC) in the last 13 months as the following chart testifies.

Shares of China Life Insurance (NYSE:LFC) have been under weather along the uncertain outlook for the Shanghai Composite Index. China Life derives a significant portion of total net income from investment returns related to the performance of the Shanghai Composite Index. China Life Insurance (NYSE:LFC) has a significant investment in index heavy weight stock such as Petrochina (SHA:601857) and Industrial and Commercial Bank of China (SHA:601398).

If China Life Insurance (NYSE:LFC) can demonstrate strong revenue growth - as is the case fro January - stock price appreciation will follow.

造金融保险业航母观海听涛

⊙记者 卢晓平 ○编辑 王颖

他的儒雅睿智，早有耳闻。相识几年，更有深刻感受。

　　在他北京金融街(10.95,0.16,1.48%)中国人寿(27.71,-0.19,-0.68%)大厦的27层办公室里，一幅刚劲有力的书法“观海听涛”透露出拥有者的眼界胸怀……

　　他是位和蔼可亲的睿者，又是有着强烈社会责任感的企业家。他带领占据国内保险市场半壁江山的金融保险集团，成为我国保险行业唯一的“世界双500强”企业。

　　他令全球市值最高寿险公司的中国人寿，积极应对金融危机，连续5年取得了骄人业绩。
　　我们之间短信往来，我写的是中文，他回的是英文；我们谈论的话题，从金融到经济社会无所不包，一个有着丰富金融保险经历的他，在精炼话语中，无不透露出善于学习、与时俱进的修养。

　　他的办公室，一个地球仪迎接着每日朝霞。

　　全球视野防范风险
　　有过10多年海外留学和工作经历的杨超，考虑问题时的全球视野已经形成习惯。中国经济早已融入世界，中国金融保险与世界相互融合。亲身经历1997年亚洲金融风暴，让他养成高度的风险防范意识和稳健经营作风。

　　“国际金融危机背景下，保险业的深刻变革为公司的发展提供了难得的外部机遇”，他在危中寻机。

　　有据为证：去年，在对外投资中，国寿稳妥推进国际化进程，没有出现重大损失，而在危机的影响逐渐确定的情况下，果断出手，及时调整资产战略配置，增加权益投资比例，特别是抓住境外金融机构大规模减持中资银行股份的时机，成功购进美国银行出让的建行H股股票，创造了香港证券市场有史以来最大规模的大宗交易。正是这样一种进退有度的经营风格，才在险象环生的世界经济形势和国际金融危机面前保持平稳健康发展。

　　数据也说明：去年，国寿集团总保费收入达到3221.18亿元(未经审计)，实现了平稳增长；总资产达到1.56万亿元，较年初增加2707.83亿元，占全行业总资产的37.7%；上市公司业绩预增超50%。品牌价值高达824.37亿元，在国内金融类企业中名列第3位。

　　敢于大浪淘金，不等于无视风险。令人关注的是，杨超根据科学发展观，提出了“不怕险、忌冒险、善控险、能化险”的科学风险观。防风险是手段，最终目的是为了提升抗风险能力，提高综合经营管理能力，这才是目的。他强调，2010年仍要切实加强风险防范，及时、准确把握国际国内经济金融的发展形势，在判断和决策上不能出现大的失误。目前我国经济回升向好的基础还不稳定、不巩固、不平衡，特别是结构性矛盾仍很突出，需求不足和供给结构性矛盾并存。

　　“最近中央反复强调，国际金融危机并没有完全过去，消除危机的影响更是一个长期的过程。这将直接或间接地影响到公司的发展。对此，我们一定要有危机和忧患意识，把问题想得复杂一些，把困难考虑得多一些，把应对措施准备得更加充分一些”，他强调。

　　做久做优求稳健经营
　　几年前，在粗放式发展成为潮流的时候，杨超逆势考虑的是做强做大。如今，他又往前多走了一步，做久做优成为首选。

　　也许，是曾经的学医经历让他的思维缜密，求真务实。

　　“我学过医，人的肌体要想健康长寿，绝对不要逞能一时，否则会在肌体内打下烙印，到一定时候必然暴露，危及生命”，杨超很认真。因为，只有防范风险、稳健经营，才能实现平稳健康发展。只有科学发展、壮大实力，才能经受住严峻考验。

　　他强调，要持续推进结构调整，进一步完善推进结构调整的财务、预算、人力、考核等政策，注意保持政策的连续性、稳定性和严肃性，有效发挥对结构调整的激励、约束和导向作用；要科学调整，不搞“一刀切”，尤其要从负债业务与资产业务的结合上全面分析、统筹研究结构调整问题，使保险产品结构、负债结构更好地适应资本市场、货币市场、利率政策的变化。

　　“要正确处理发展与调整的关系，不能离开发展主题搞调整、停下发展脚步搞调整、脱离客户需求搞调整、不顾市场竞争搞调整。”他说。

　　他给出调整框架：全面调整，调整优化业务结构、渠道结构、城乡结构、效益结构和队伍结构。其中在业务结构方面，要大力发展风险保障型、长期储蓄型和非车险等优质业务，努力提高优质业务的比重；在渠道结构方面，要实施多渠道发展策略，明确不同渠道的发展定位，着力构建优势互补、良性互动、协调发展的渠道新格局；在城乡结构方面，实行差异化发展策略，专门制定针对特定区域市场、适应巩固和夺回城区市场主导地位需要的差异化产品政策和考核政策，务必在提升城区市场竞争力方面取得实质性进展。

　　工夫不负有心人。他的果敢敏捷使得中国人寿创造了奇迹。

　　去年，国寿经营风险得到有效防范，发展基础更加巩固。财务、业务管控不断强化。依据集团整体盈利目标分解下达各直属单位预算，充分发挥了预算的管控和导向作用等；着力加强了对外部复杂形势、资本市场态势及其应对策略的分析研究，有效防范了决策风险和投资风险；针对资本市场大幅下滑导致分红水平和万能险结算利率的下降情况，在行业退保支出增加的情况下，寿险公司退保金额同比减少15.12%，退保率为3.18%，同比下降1.2个百分点，有效防范了非正常退保风险。

　　天时地利人和人为先
　　人是第一生产力，杨超现在不仅看重个体，更重视群体力量。
　　春节前，温州。中国人寿员工脸上洋溢着喜庆。温州银海团队得到了“中国人寿第一团队”的称号，成为中国人寿乃至中国寿险营销战线的一面旗帜。

　　在授旗现场，我看见员工们在笑、杨超在笑。员工笑中透露出一份收获喜悦；杨超的笑中，包含一份深情和卓识。

　　中国人寿有1万8千余个营销团队，为什么将此殊荣给了温州？
　　杨超一语道破，当前，中国人寿已经站在打造国际顶级金融保险集团，争创国际一流寿险公司的新起点上。应以银海团队为榜样，进一步解放思想、夯实基础、开拓进取，全面提升团队的综合管理水平和团结协作能力。同时，各营销团队要利用中国人寿这个最大的市场作为大舞台，依赖中国人寿这个后台，努力搭建好营销伙伴展业创富的平台。

　　面对新的市场竞争环境，通过特殊的春节慰问活动，中国人寿管理层将新阶段在全系统提倡什么、宣传什么、鼓励什么表露无遗，同时也向市场传递了一个鲜明信号――中国人寿这艘巨型航母将从基层团队转型入手开始新的远航。

　　在杨超看来，万丈高楼平地起。没有基层的因子铺垫，哪里有高楼的辉煌。要想航母升级换代，不从基层抓起谈何容易。况且，当前市场主体越来越多，集团化竞争的特征越来越明显，大中城市竞争更趋于白热化，国寿巩固和夺回城区市场的任务十分艰巨，并且竞争区域正逐步向县域农村市场延伸，给公司带来了很大挑战。

　　据了解，这支团队连续9年蝉联全国寿险销售团队新单保费规模/佣金第一名，创造了中国人寿团队发展史上的奇迹。按照杨超的话：实现公司利益最大化和个人价值最大化的高度统一。

　　除了基层团队，在杨超眼里，集团上下整体人才队伍系统建设更显迫切。
　　他告诉记者，2010年要进一步完善选人用人机制。重点是要强化对领导干部的考核评价、激励约束和选拔任用；要突出科学发展成绩，将经营绩效分析、经济责任审计、组织考察相结合，将定期考察、年度考察和任期考察相结合，把政治上靠得住、工作上有本事、作风上过得硬、职工群众信得过的干部选拔上来。

　　另外，将全方位加强“三支队伍”的培养管理，着力加强管理干部队伍的建设，造就一批专家型技术人才；注重对销售队伍的培养管理，逐步建立一支满足大中城市业务发展需要和适应高端客户拓展需求的专门销售队伍；要重视后备干部的岗位锻炼，力争用三年时间把地市级分公司、县支公司负责人轮训一遍。

　　杨超是感情丰厚的人，在去年地震灾区看望广大员工时，他落泪了。带去的不仅是温暖，还有大量灾区急需的物品。但他同时又是原则性很强的人，强调坚持勤俭节约办企业，严格控制员工特别是管理人员增长，反对铺张浪费，养成勤俭办企业的良好风气。

　　国寿要为今后翱翔打下坚石，人是本。

　　整合求飞跃
　　喜欢打网球的杨超，身体素质不是一般人所能比拟的。充沛的精力，不仅使他经常忙碌奔波于基层，而且，养成了雷厉风行，开拓创新的办事作风。

　　整合出效益，创新求发展。杨超当然没有忽视这一点，他有一套《中国人寿资源整合发展规划》。

　　今年公司工作任务中明确，要着力加大全系统资源整合力度，完善资源整合机制。要强化集团公司在资源整合中的领导组织作用，完善总公司层面的资源整合机制，建立省级分公司及以下机构的资源整合组织体系。在销售资源整合上，要完善互动业务体制机制，积极探索寿险、财险、养老险各级公司联合拓展大客户的有效模式；在客户和服务资源整合上，要尽快建立客户资源共享平台……

　　整合带来了意想不到的收效，公司发展质量和效益不断提升。

　　从去年的业绩看，承保盈利能力得到提升，另外，资产管理能力不断提高。目前，投资收益仍然是当前全系统盈利的最主要来源，资产公司在整个集团的发展中起着举足轻重的作用，因此，下一步的重点是要切实承担起提高投资收益的重任，加强对形势、政策和市场的研究，科学配置资产，准确把握市场机遇，在确保防范风险的前提下，为提升全系统的盈利水平作出更大贡献。

　　从目前国寿整体架构看，寿险、财险、养老险等保险体系布局齐备，从金融架构看，资产管理、股权投资、不动产投资、参股银行、参股信托等等已经建立或在建立过程中，一个保险金融集团航母在新时期正昂扬起帆。

中国人寿的故事

口述者：王宪章
　　中国人寿保险(集团)公司原党委书记、总经理，现任中央财经大学保险学院院长。
　　今年是中国人寿诞生60周年，中国人寿能够成功改制上市，并发展成为今天这样一个倍受瞩目的知名企业，与当时一位中央高层领导的关怀和支持是分不开的。这位领导就是时任国务院总理的朱镕基。朱镕基与中国人寿的事情，一直鲜为人知。

　　我和镕基“抬杠”
　　上世纪90年代初，朱镕基同志担任国务院常务副总理时，主管金融工作。当时，市场经济体制还没建立起来，金融保险领域的行政化色彩比较浓厚，一些政策文件的起草往往带有部门色彩，必然要经过一番激烈的争论。

　　为了制定好政策，镕基同志经常召集专题座谈会，有一次国务院召开有关社会保障体制改革的会议，参加会议的有劳动部、民政部、财政部等政府部门的领导，我代表中国人民保险公司出席。在会上，一个主导意见是保险应由政府部门包办，我对此很不认同，当即发言：政府部门不能制定限制一家国有保险公司合法经营的政策，更不能代替商业保险公司的职能、渗入商业保险环节。我也拿出了相关政策法规依据。朱镕基就我提出的意见对我进行了提问，这次我给镕基同志留下了“爱抬杠”的印象。

　　会后，我对朱镕基同志说：“我的意见有些偏激，如果干扰了领导决策，请尽管批评。”他却心平气和地说：“宪章同志，没关系，道理是越辩越明的，辩论的过程就是学习的过程！”我后来听说，在一次有关保险的会议上，镕基同志还问人保公司的领导：“你们那个爱抬杠的王宪章哪里去了？”

　　镕基调我回中国人寿
　　1993年，组织委派我到香港担任中国保险控股有限公司“一把手”，到1999年已有6年光景。这年我已58岁了，我本人已准备好在这个岗位上将我的职业生涯画上一个句号。没想到，就在这个时候，情况发生了变化。

　　1999年年底的一天，我在香港的办公室接到了时任中央金融工委副书记阎海旺的秘书打来的电话，叫我速回北京一趟，具体什么事情电话中不便交代。到了北京，我直奔位于航天桥附近的华融大厦，那里是中央金融工委的办公所在地。阎海旺一见到我，什么也没说便拿出一份文件让我自己看。这是一份从镕基同志那里批转来的文件，上面有一段他的亲笔批示，内容是：中国人寿很重要，如果经营不好，造成一个大窟窿，怎么向人民交代！是否考虑迅速将在香港的王宪章调回来，任中国人寿总经理。就这样，我到了中国人寿。

　　镕基给我派任务
　　这家占保险市场份额最大的国有独资公司，当时的情况并不乐观，公司管理体制落后、经营机制僵化、历史包袱沉重，特别是从1996年5月起人民银行连续7次降息，一年期存款利率由10.98%降至2.25%，使前期高预定利率寿险业务出现了400多亿的利差损，公司经营到了举步维艰的地步。

　　上任不久，镕基同志就让秘书把我叫去。他开门见山、神情严肃地对我说：“宪章同志，我调你回来就是让你帮助尽快化解利差损。你的任务就是先把情况搞清楚，3个月后给我一个报告。”我临危受命，开始担起了我有生以来最重的一副担子。

　　上任后，要做的事情很多，但当务之急就是要迅速扭转业务下滑的被动局面。我于2000年3月中旬给各省分公司总经理写了一封信，恳切要求各分公司认真查找业务下滑原因，抓紧拿出应对措施，全力以赴把业务搞上去。这封信集中了公司领导班子的智慧，说出了广大员工的心声，起到了统一思想、振奋精神的作用。后来，公司有人戏说这封信价值百亿保费。

　　与此同时，我和班子成员也开始思考公司今后的发展道路，主要思路写进了上报总理的报告中。这份报告，分析了公司当时的业务、财务状况，提出要根本改变公司经营面貌，一靠业务发展，二靠体制改革。这个报告得到了镕基同志的认可。

　　镕基力挺整体上市
　　我到中国人寿的头一年，全公司共完成保费收入652亿元，经营局面基本稳住了。到2002年，中国人寿的保费收入上了千亿元台阶，达1288亿元。业务搞上去了，才有条件改制上市；而只有不失时机地推进体制改革，公司才能真正走上持续健康发展的轨道。因此，在发展业务的同时，公司也组织有关力量研究筹划股份制改革方案。

　　关于改制方案，无论是公司内部还是外部，争论都比较大。一种方案是整体改制，另一种方案是区域分拆。后一种方案就是将全国各省级分公司按不同区域分成若干个子公司，靓女先嫁，比如将江苏、浙江、广东、上海等业务资源较好的分公司改制成股份公司，先行上市。

　　区域分拆操作起来相对容易一些，也能创造出更多的职位，因此不乏支持者，当时业务主管部门也赞成这一方案，并上报到了国务院。对这个方案，我是不能接受的，因为我认为那会造成公司的四分五裂，破坏了公司的整体优势。于是我在报纸上发表了一篇文章，阐述了我倾向整体改制的看法，当时自己的思想压力也很大。

　　这时，又是镕基同志给了我很大支持。他说：“中国的保险业虽然发展快，但起步晚，规模不大，如果分拆将无法与国外大公司竞争，我赞成整体改制。”现在看来，朱镕基同志对中国人寿的改革发展，头脑中早就谋划了“一盘棋”。正是他的高明智慧，中国人寿的改革才没有走弯路。

　　最终，我们确定了新老划断的重组方案，并获得国务院的批准。该方案以时间为界对业务、资产实行重组，1999年以前保单业务及相应资产保留在集团公司，1999年以后保单业务及相应资产划归股份公司。股份公司轻装上阵，无论在偿付能力、盈利能力、回报水平等方面均具有较强的竞争实力，具备了走向国际资本市场的条件。为了切实保护老保单持有人的利益，财政部与集团公司共同建立共管基金，管理用于老保单给付的全部资金，这一机制设计也为最终化解利差损创造了条件。

　　镕基批准我延期退休
　　2002年我年满60岁，到了退休年龄。这时正值公司重组上市的关键时刻，如果临阵换将，很多事就要拖下来。镕基同志得知这种情况，亲自指示：考虑到中国人寿正处在重组改制的关键时期，王宪章的任职年龄可以适当延长。他批准我延期退休，就是让我有时间把他交给的任务完成好。

　　2003年，中国人寿的股改上市工作进入了倒计时阶段，保监会对这项工作给予了大力支持。保监会吴定富主席对我说：“方向对头，你们大胆搞，我全力支持。”公司重组改制首先要定好班子，保监会党委派党委委员、时任纪委书记的赵杰兵专门负责公司班子的考核和配备工作。考核组仅用了20多天就把集团公司、股份公司、资产管理公司三套班子确定了下来。

　　最让我感动的是，在保监会班子考核中，通过无记名投票，我的考核合格率达95%以上，优秀率达73.3%。赵杰兵对我说，能够获得如此高的评价是不容易的。当保监会考核组通报情况时，我流下了眼泪。

　　镕基满意人寿的发展
　　2003年11月底，我们开始了境外上市的路演工作。路演十分辛苦，行程非常紧张，一个城市接一个城市，一个会议接一个会议，没有正式吃过几顿饭。但辛苦没有白费，我们拟上市的公司受到了投资者超乎寻常的青睐。我们拜访了102家机构投资者，其中有101家下单认购，成功率之高是很少见的。在香港，人们争相认购，甚至有“不买中国人寿的股票就是不爱国”的说法。

　　12月初，正值温家宝总理访美，我们想请温总理亲临纽约证券交易所为中国人寿股票首日上市敲钟开市，温总理也欣然答应。只可惜时间没赶上，留下了遗憾。

　　2003年12月17日和18日，中国人寿的股票在纽约、香港两地成功上市。此次IPO发行股票74.4亿股，融资规模为34.8亿美元，创下了当年全球最大规模的IPO。中国人寿闯出了一条独具特色的重组上市之路。2005年5月，我从中国人寿的领导岗位上退了下来。就在退休的前几天，我参加了《财富》全球论坛，期间胡锦涛主席接见了500强企业代表。见到胡主席，我简短地汇报了中国人寿在海外成功上市的情况。胡主席亲切地鼓励道：“很好，祝贺你们！”

　　后来，在我的继任者杨超的带领下，中国人寿又于2007年初成功回归A股，公司在世界500的排名连年提升。

　　我退休后，有一次见到一位曾在朱镕基身边工作的同志，他说：“镕基同志让我代他向你问好！”看来，镕基同志看到中国人寿的良好发展局面，是感到满意和欣慰的。

Bilibala mailbox 10/01/21

Question:
brk.b goes up to 72 this morning. is it too high to buy? or focus onwfc? how about mfc? why u suggest to buy more? thanks

Answer:
Berkshire Hathaway
Berkshire Hathaway go up these 2 days from $65.0 (or $3,250 before split) to above $72.0 because of

• the stock split which trigger the transaction volume to go up because the price is lot more "attractive" & "relatively cheaper" in an irrational investment sense after it dropped from $3,300 to only $66.0
• Warren Buffett indirectly mentioned in an interview that the stock price is undervalue

In long run, Berkshire Hathaway's price is still undervalue, however, to most of the investors, will refuse to buy when it is going up.

On the other hand, stock split has no impact to the value of a company, if i assume everything else is constant, price will adjust back to where it should be after a short term rally.

Wells Fargo
I have a better idea on Wells Fargo’s 2010 outlook after a flash review of its 4q09 and 2009 results. I think its EPS should be able to rise from US$1.75 in 2009 to US$2.85 & US$3.05 in 2010 & 2011. Given the following:

• Continue improve in net interest margin
• Expect the loan provision to drop smoothly in 2010 and further in 2011
• Paid off the $25B TARP in 4q09 – will save $420M dividend expenses per qtr
• House market recover Its 12 months target price should at least be US$34.77.

I personally think Wells Fargo worth US$60.0 by the end of 2014 (5 years from now).Given the current stock price is US$27.82 (01/20/10’s closed), there will be a potential return of 25% in the coming 12 months.

Manulife Financial
I see significant improve in investors confident to equity market. Manulife’s 4Q sales should improve while sum at risk will fall. Bilibala increases its fair value from C$31 to C$35.
I need to review its 4q09 & 2009 result before I can hold firm on my opinion.

Looking at Manulife Financial Corporation performance

http://www.learningmarkets.com/index.php/200912079391/News-Feed/News-Feed/looking-at-manulife-financial-corporation-performance-since-earnings-mfc-ing-axa-lfc.html

=> I guess you can't analyze an insurance company like the following article. It add no value to determine whether an insurance company is worth to invest or not.

Monday, 07 December 2009 05:24
Earnings announcements can make investing tricky. Many investors try to time trades based on earnings releases, but usually find such trading is inconsistent and risky. It is often better to take a look at how the market has reacted to a company’s results a few weeks after the initial announcement.

Manulife Financial Corporation (MFC) delivered its earnings announcement on 11/05. The company reported a change in quarter-over-quarter sales of 136.00% and posted an EPS (trailing twelve months) of - .81.

By now the market has had time to settle in and look closely at the numbers. A stock’s performance in the few weeks following an announcement, compared to other stocks in its industry, the industry as a whole, and market as a whole, really tells you how investors and analysts felt about the announcement.

Compared to the rest of the “Life Insurance” industry

Since the MFC announcement (about 30 days ago), the stock has posted a -10.78% gain (loss). Over that same period, the stock’s industry, Life Insurance, saw a 3.40% gain. That means MFC that has under-performed its industry as a whole 417.06% since the earnings announcement. Small differences aren’t significant, but when the spread is large it indicates the stock is either much more or much less favored than its group as a whole.

Compared to peers

Another way to gauge performance is look at a stock compared to other stocks in its industry with similar market caps. MFC peer ING GROUP NV ADS (ING) has seen a -28.91% stock price gain (loss) over about the last month, while another peer, AXA (AXA) saw a 1.06% gain. So with a return of -10.78%, Manulife Financial Corporation outgained ING and under-performed AXA’s price performance over the last month.

China Life Insurance Co. Ltd. (LFC) is one of the largest stocks in the industry in terms of market cap, and over the same period has returned 10.99% in price.

Compared to the S&P 500 Index

Finally, let’s see how Manulife Financial Corporation stock performance compares to the rest of the market by looking at it compared to the Standard & Poor’s 500 Index (.INX). Since 11/05, the S&P 500 index has returned around 3.4%, and again, MFC saw about a -10.78% gain (loss) during that time. Could be better.

So by putting the returns in context by these comparisons, we can see how a stock’s performance since earnings really measures up and make our investing decisions on MFC accordingly.

China Life reportedly considering Hong Kong unit spin-off

HONG KONG (MarketWatch) -- China Life Insurance Co. (2628.HK) may consider spinning off its Hong Kong unit in a separate listing in three years, the Oriental Daily reported Wednesday, citing Liu Ting-an, president of the unit.

=> normally, spin off will provide:

1. Add value to the insurance company
2. Provide better segment and regional financial analysis
3. Allow senior management to focus on its mission & projects to both the parent company & the subsidary

Liu said China Life hasn't decided where to list its wholly owned unit, China Life Insurance (Overseas) Co., "but a separate listing in Hong Kong may confuse investors with our (Hong Kong-listed) parent company."

Liu also said the unit isn't keen on making acquisitions, and he expects its revenue to exceed HK$30 billion this year. The report didn't specify the unit's 2008 revenue.

The unit has been established for around 25 years and mainly operates in Hong Kong and Macau.

Newspaper Web site: www.orientaldaily.on.cc

壽險市場份額下滑中國人壽

鉅亨網新聞中心 2009 / 11 / 19 星期四 11:39

昨日，中國人壽 公佈的2009年1-10月的最新保險經營數據顯示，公司今年10月份的保費收入環比大幅下降34.29%，前10個月累計同比下降3.82%,列三家上 市險企環比降幅之首。從中國人壽在各地區1-9月份人壽保費收入當中亦不難看出,中國人壽強大的壽險份額正在面臨各地城池失守的窘境。

　　國壽份額在多個地區被平安趕超

　　中國人壽公告的經營數據顯示，其前十個月完成保費收入2547億元，這一數據較去年同期下降3.82%。10月單月實現保費收入174億元，環比9月份的265億元下降幅度高達34.29%。這組明顯下滑的數據，或將對其當月在全國市場的佔有份額產生不利影響。

　　提起中國人壽,其在國人心中是當然的險企巨無霸。正是這樣一艘業界航母,如今卻正面臨著同業的趕超，在局部的競爭當中,正經歷「損兵折將」，城池失守的窘境。也許是它的神經末梢脈絡龐雜以致於與大腦的溝通不暢，造成局部微循環出現了問題。

　 　記者從保監會網站公佈的數據發現，自2007年開始中國人壽與中國平安在深圳的市場地位發生了逆轉。國壽在深圳連續8年的老大地位被平安搶得。2007 年底，中國人壽在深圳的人壽保費收入為22億元，中國平安在深圳的人壽保費收入為28億元，兩者差距為6億元。進入2008年，中國人壽深圳公司與中國平 安深圳公司的市場份額差距有所減少。2008年，中國人壽在深圳的人壽保費收入為38億元，中國平安在深圳的人壽保費收入為42億元，兩者差距僅為4億 元。差距大幅收窄35.82%。

　　但這一差距在2009年的前9個月內並未被繼續收窄，反而出現較大幅度的擴大，儘管距離年尾尚有不到2個月的時間，但面對強大的競爭對手，似乎2個月的時間不算長。畢竟，中國平安在深圳用了很長的時間才坐到頭把交椅的位子，料其不會輕言放棄。

　　據深圳市保監局公佈的人壽保險公司原保險保費收入情況表顯示，2009年1-9月中國人壽深圳分公司的保費收入為31億元，而中國平安深圳分公司已經高達43億元，兩者相差12億元。

　 　對於份額的差距，中國人壽深圳分公司的相關人士告訴記者，就深圳市而言，中國平安與中國人壽的競爭最近兩年一直處於焦灼狀態，但中國人壽誓做深圳最好的 保險公司這一目標始終不渝，單就幾個月的數據對比，也不足以表現公司全年的經營狀況。同時該相關人士對於公司的發展前景充滿信心。

　　份額下滑累及分公司掌舵人？

　　近日有媒體報道，因近兩年公司在深圳的市場份額久居次席，中國人壽保險股份有限公司於日前更換了深圳分公司總經理。報道同時指出，這是國壽深圳分公司在兩年內的第三次總經理換帥。臨近年底出現高管人員的更迭，是臨危受命還是為來年的戰略佈局打基礎尚不得而知。

　 　據報道稱,1999年-2006年，中國人壽深圳分公司牢牢佔據深圳市場的「龍頭老大」位置，連續8年總保費居於深圳市場首位,「深圳保險市場的龍頭」 地位一直未被撼動。然而，面對市場佔有率的下滑，面對高層管理人員的更迭，中國人壽深圳分公司相關人士對記者表示，相關媒體報道稱中國人壽深圳分公司總經 理換人及市場份額下滑只是在時間點上的一種巧合，市場份額下滑與人士變動沒有內在聯繫。人士變動僅是公司高層著眼於公司未來發展的考慮。該人士進一步解釋 說，中國人壽深圳分公司原總經理梁勇是在今年6、7月間離開公司的，接到上面的通知也只是說由身為副總經理的周玉潔主持公司工作，目前總經理的人選尚處空 缺之中。

　　如果僅是因為市場份額減少使公司龍頭地位受到威脅而換人的邏輯成立的話，那麼，還有哪些地區老總的座椅岌岌可危呢？

　 　記者從保監會公佈的歷年人壽保險公司原保險保費收入情況表中發現，中國人壽出現市場份額下滑的地區並不止深圳一個地區，就單個城市的對比來看，同是沿海 經濟發達地區的上海，今年前9個月內中國人壽壽險保費收入為71億元，中國平安為92億元，二者相差21億元達30%。2008年時平安收入92億元，國 壽收入76億元，二者差16億元，2007年時，平安收入80億元，國壽收入67億元，差距為13億元。13億元、16億元、21億元，可以看出，差距正 在逐年拉大。

　　在北京，今年前9個月內中國人壽壽險保費收入為58億元，中國平安為89億元，二者相差31億元達53%。2008年時平 安收入88億元，國壽收入69億元，二者差19億元，2007年時，平安收入70億元，國壽收入55億元，差距為15億元。15億元、19億元、31億 元，同樣是差距在增大，而且今年前9個月的差距較去年年底的差距放大明顯。

　　在天津，今年前9個月內中國人壽壽險保費收入為23億元，中 國平安為27億元，二者相差4億元達17%。繼2009年2月中國人壽在天津首次被中國平安趕超以來，歷經7個月的競爭中國人壽天津分公司始終未能奪回失 去的陣地，且差距從1億元逐步拉大到4億元。2008年時平安收入28億元，國壽收入43億元，二者差15億元，2007年時，平安收入24億元，國壽收 入28億元，差距為4億元。

　　如果按中國人壽深圳分公司相關人士對記者所表示的，市場份額下滑與人士變動僅是一種「巧合」，那麼，這樣的巧合是否會發生在上述地區呢？平安天津的趕超已為中國人壽其他分公司的境況敲響警鐘。

　　市場老大地位堪憂

　 　在中國人壽市場佔有率具有明顯優勢的地區，中國平安與中國人壽的市場份額差距正在逐步縮小。例如，中國人壽廣東分公司今年前9月壽險保費收入達231億 元，中國平安廣東分公司當期壽險保費收入為99億元，差距為132億元。而中國平安與中國人壽兩公司去年同期保費收入在廣東的差距為174億元。

　　兩公司市場份額在激烈的市場競爭中出現的明顯變化，不得不令人們擔心國壽欲在年內逆轉市場份額下滑態勢的雄心大志能否得以實現。

　 　年關將至，保險企業一般都會利用這段時間，通過各種方式沖業績，力圖給廣大投資者一個滿意的回報。如果因為一地的經營不善而換掉其管理人,這還是可以理 解的，但畢竟換帥是把雙刃劍。眾所周知，經歷了戀愛階段，彼此認為有了足夠的瞭解之後而進入婚姻生活的一對新婚夫妻，在生活當中尚需要經歷一段較長時間的 磨合期，磨合成功則是幸福美滿皆大歡喜，失敗則意味著有可能面臨解體。換帥不同樣也會有如此的過程嗎?

　　記者隨機採訪了中國人壽深圳分公 司某營業部的工作人員，他認為，中國人壽在深圳的市場份額下滑存在兩方面的原因，第一，目前在銷售網點及營銷人員數量上與平安存在較大差距；第二，在產品 方面，雖然營銷的產品衝突面不大，但是平安的萬能險一直都在銷售之中，而國壽的萬能險銷售則隨著貫徹落實調整結構的深入，在一段時期內賣賣停停，這在一定 程度上影響了國壽的業績，反映到市場份額上則是出現下滑，同時，他也承認，雖然2007年以來一直與中國平安存在差距，唯這次最明顯。對於上層換帥他表 示，是否因為業績持續落後於平安的原因而換人他不清楚，但他也期望，換人是著眼於長遠的戰略考慮，畢竟換人對短時期內的經營會產生不利影響。如果想在年內 剩下的2個月的時間內將市場重新奪回來，他顯得信心不足。當記者告訴他9月份國壽在北京、上海、天津的市場份額均落後於中國平安之後，他表現出了對於中國 人壽遠期市場佔有率的擔憂。

　　中國人壽於前兩年便已確立了「主業特強、適度多元」的發展戰略。在銀行、證券等資本運作領域更是大手筆頻 頻，並表示，將核心主業由目前的壽險業、資產管理，拓展到養老險和財險，逐漸擴張至銀行、基金、證券和信託等相關金融領域。那麼，如果作為核心業務的壽險 業績出現持續下滑的話，對於其開疆拓土是否會產生掣肘尚不得而知。

　　證券分析人士對中國人壽在部分地區市場份額的下滑表示，對於公司更多的要是考慮其資產的內含價值與投資收益，單就市場規模而言，一時的得與失不見得對內含價值產生不利影響。分公司的人員更迭對於總公司的發展戰略亦不會產生任何影響。

　 　如果說市場份額下滑是中國人壽上層做出換人決定的原因，那麼，從9月份的保費收入來看，深圳全市的壽險收入僅佔全國壽險收入的1.7%，以單個城市來對 比的話，遠低於北京的6.12%，也不及同為沿海開發城市上海的5.54%，甚至與新興的直轄市慶的2.4%仍差0.7個百分點。那麼，國壽為什麼獨看重 在深圳的市場佔有率呢？

Manulife Financial Fortifies its Capital Position

TORONTO, Nov. 18 /CNW/ - Manulife Financial Corporation (MFC) today announced that it will issue $2,500,400,000 in common equity in a bought deal arranged by Scotia Capital Inc. and RBC Dominion Securities Inc. Upon closing, The Manufacturers Life Insurance Company (MLI) will have access to the highest level of capital since it became a public company.

=> $2.5B is about 8% of the total market cap.

Manulife Financial Chief Executive Officer Donald Guloien said, "We are positioning Manulife for the long term. We believe this transaction achieves the fortress level of capital necessary to buffer against more conservative economic scenarios and to position us to take advantage of highly attractive acquisition and growth opportunities."

=> With MCCSR ratio 229% as of Sep 30, 09. Bilibala think they already have more than enough capital. To determine whether the share issue is positive or negative to shareholders, we need to look at its proposal.

"Our action today is consistent with Manulife's conservative approach to capital management," he added. "Achieving these strong capital levels enables us to offer an even higher degree of security to present and future customers. It also gives us tremendous flexibility."

Manulife Chief Financial Officer Michael Bell said, "Manulife continues to enjoy solid operating performance and excellent credit experience given challenging markets. Although equity markets, interest rates and credit will continue to impact the Company's balance sheet and earnings, this transaction will strengthen Manulife's flexibility to respond to both risks and opportunities."

=> that's true. Manulife is continue to deliver solid performance, even during recession and the financial crisis.

On a pro forma basis after giving effect to the $2.5 billion offering of common equity, if the entire amount of the proceeds of the offering were invested in MLI, and reflecting market conditions as of the end of our third quarter, Manulife estimates that the pro forma Minimum Continuing Capital and Surplus Requirements (MCCSR) ratio of MLI as at September 30, 2009 would have been approximately 256% versus the 229% MCCSR reported at the end of its third quarter. This ratio, on a pro forma basis, would be the highest since MFC became a public company.

=> what is the use to such high MCCSR ratio?

A Syndicate of underwriters being led by Scotia Capital Inc. and RBC Dominion Securities Inc. in a bought deal public offering has agreed to buy $2.5 billion in Manulife common shares at a price of $19.00. The public offering is expected to close on or about November 30, 2009, subject to satisfaction of customary closing conditions.

The Company has granted the underwriters an over-allotment option, exercisable in whole or in part at any time up to 30 days after closing, to purchase up to an additional $375,060,000 in common shares at the same offering price. Should the over-allotment option be exercised in full, the total gross proceeds of the offering would be $2,875,460,000.

The estimated net proceeds from the offering will be approximately $2.413 billion, after deducting the underwriting fee and before the estimated offering expenses payable by the Company. The Company expects to use the net proceeds from this offering for general corporate purposes, which may include contributions of capital to its insurance and other subsidiaries, potential acquisitions or other growth initiatives. The Company has not yet made a determination as to how much of the proceeds will be invested in MLI and how much will be used for other corporate purposes. Following the offering, the Company also intends to retire the approximately $1 billion outstanding indebtedness under its Credit Facility with Canadian chartered banks using other cash resources of the Company.

=> 3.48% floatation cost, reasonable, but to me, still high. Other than paid down $1B debt, it do not have any plan yet :(

Michael Bell said, "While the common equity issue is expected to be dilutive to the Company's Earnings Per Share (EPS) and Return on Equity (ROE), the Company believes that strengthening its capital position is in the best long term interests of the Company and its shareholders."

=> at this point in time, Bilibala will keep Manulife's fair value at CA$32.0

The common shares to be offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended (U.S. Securities Act), and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the U.S. Securities Act. This press release is not an offer to sell or the solicitation of an offer to buy such common shares in the United States or in any other jurisdiction where such offer is unlawful.

Manulife Financial is a Canadian-based financial services group serving millions of customers in 22 countries and territories worldwide. Operating as Manulife Financial in Canada and Asia, and primarily through John Hancock in the United States, the Company offers customers a diverse range of financial protection products and wealth management services through its extensive network of employees, agents and distribution partners. Funds under management by Manulife Financial and its subsidiaries were $437 billion (US$407 billion) as at September 30, 2009.

Manulife Financial Corporation trades as 'MFC' on the TSX, NYSE and PSE, and under '945' on the SEHK. Manulife Financial can be found on the Internet at www.manulife.com.

Manulife Financial 3q09 press release

• Charges due to lower corporate bond yields and changes in actuarial assumptions offset strong
operational results and gains due to equity market increases, resulting in a modest net loss for the quarter
• Margins improved through increased pricing, adjustments to sales compensation and more favourable reinsurance terms
• Strong sales growth across most products other than variable annuities generated a more balanced business mix
• Equity risk profile improved through hedging, pricing, product and asset mix changes
• Excellent credit experience given challenging markets – asset quality remains a competitive strength
• Two attractive acquisitions – AIC mutual funds and Pottruff & Smith travel insurance
• Equity markets, interest rates and credit will continue to impact the Company’s balance sheet and earnings
• Focused on building to fortress capital levels over time – expect benefits from merging U.S. operating subsidiaries at the end of 2009

=> 3q09 results is lower than Bilibala's expectation

TORONTO – Manulife Financial Corporation (“MFC”) today reported a net loss attributed to shareholders of $172 million for the third quarter ended September 30, 2009, compared to net income of $510 million in the third quarter of 2008. The loss per share was $0.12 compared to fully diluted earnings per share of $0.33 in 2008. Current quarter results reflect equity market increases offset by lower corporate bond rates and changes in actuarial assumptions. The Manufacturers Life Insurance Company (“MLI”) reported a Minimum Continuing Capital and Surplus Requirements (“MCCSR”) ratio of 229 per cent as at September 30, 2009, up from 193 per cent last year.

In its second quarter earnings release, the Company included a forward-looking statement that estimated normalized earnings to be between $750 million and $850 million per quarter for the remainder of 2009 and 2010. The third quarter’s adjusted earnings from operations1 under this definition was approximately $803 million.

Chief Executive Officer Donald A. Guloien said, “Underlying earnings and performance were solid this quarter, but our results were negatively impacted by lower corporate bond rates and strengthening of reserves for changes in actuarial assumptions. We took actions to improve margins, increased our sales of products other than variable annuities, further improved our equity risk profile and continued to build toward fortress capital levels. We announced two attractive acquisitions and see numerous opportunities for strategic growth across a variety of markets. We remain highly disciplined and will continue to build upon Manulife’s scale and key strengths including our superior asset quality, well recognized brands, leading products and distribution, excellence in investment management, and strong positioning in key growth markets.”

FINANCIAL RESULTS

Chief Financial Officer Michael W. Bell said, “Continued declines in corporate bond rates required a further strengthening of actuarial reserves this quarter. We also increased reserves for changes in actuarial assumptions including those related to policyholder behaviour for variable annuity products. As a result of the decline in interest rates and changes in lapse assumptions, our interest rate sensitivity has increased.

Nevertheless, Manulife’s underlying business growth remains strong, and the quality of our investment portfolio remains a competitive strength. MLI’s MCCSR remains strong at 229 per cent, and we continue to take focused action to improve our risk profile and strengthen our capital flexibility as we grow our Company.

We anticipate that, at year end and subject to regulatory approvals, we will complete a reorganization of our U.S. subsidiaries which will deliver capital and operating efficiencies.”
Increases in equity markets in North America, where the S&P 500 increased 15 per cent and the TSX increased 10 per cent in the quarter, generated non cash gains of $1.2 billion. Of this, $1.0 billion related to segregated fund guarantees and the remainder was attributable to future fees assumed on variable universal life products and gains on equities supporting policy liabilities.
The Company reported a non cash charge of $1.2 billion resulting from the decrease in interest rates and corporate spreads during the quarter. Changes in interest rates impact the actuarial valuation of in-force policies by changing the assumption for future returns on the investment of net future cash flows. The decline in interest rates also impacted the investment returns assumed for new business written in the quarter, particularly in U.S. Insurance.

As indicated in the prior quarter, the Company completed its annual review of all actuarial assumptions in the third quarter. This resulted in a charge to earnings of $783 million, including $469 million due to changes in assumptions of policyholder behaviour for segregated fund guarantee products (a charge that was within the Company’s previously communicated expectations of less than $500 million). The remainder of the charge included assumption changes related to morbidity and other policyholder behaviour, partially offset by assumption changes related to mortality, expenses and investment related items.

The Company’s investment portfolio continued to perform well relative to overall market conditions, with $111 million of impairments in the quarter. The third quarter results included charges of $30 million for credit losses, $6 million for credit downgrades, $32 million in other than temporary impairments (“OTTI”) on equity positions in the Corporate and Other Segment, as well as $43 million on private equity investments.

MLI reported a MCCSR ratio of 229 per cent as at September 30, 2009, up from 193 per cent last year. Significant progress has also been made in the reorganization of the Company’s U.S. subsidiaries, with a planned merger of the main U.S. operating companies, under MLI, on track to be completed effective as of year end. The merger will result in a more efficient capital structure and provide improved operating efficiencies. Post reorganization, MLI expects to benefit from more stable capital ratios and a more diversified risk profile. While MLI’s MCCSR ratio is expected to decline as a result of the re-organization, the Company’s cushion for equity market declines over minimum regulatory requirements is expected to remain approximately unchanged because of the reduced equity sensitivity.

Bilibala's adjusted earning:
Bilibala's adjusted earning included all the market volatile items, because the nature of insurance business is market driven, there is no point to exclude them.
* Bilibala will exclude impairment because that is controled by management business decision.

GAAP EPS ($0.12)

add back:
Impact of annual basis changes $0.55
Impairment $0.08
Others $0.02

Bilibala's adjusted EPS $0.53
Bilibala's estimated EPS $0.64

Earning still look solid, as yield curve start heading up and US dollar get stablized, I think 4q09 results should look significantly better than 3q09.