Fitch: China Taiping Insurance on positive watch

Fitch Ratings said it placed the A- issuer default rating of China Taiping Insurance Group Ltd. and the A- insurer financial strength rating of its life subsidiary, Taiping Life Insurance Co., Ltd., on Rating Watch positive following news that China Taiping Insurance Holdings Co. Ltd. will raise fresh equity via a share issue.

The ratings on positive watch include the BBB+ rating on the $400 million 6% senior unsecured notes due 2023 issued through China Taiping New Horizon; BBB+ rating on the $300 million 4 1/8% senior unsecured notes due 2022 issued through China Taiping Capital Ltd., along with the BBB- rating on its $600 million cumulative perpetual subordinated securities.

Fitch said it expects to resolve the positive watch upon discussion with management about the group’s longer-term capital structure and adequacy and an evaluation of the strategic status of its insurance subsidiaries in both Hong Kong and China within the group.

The watch is linked primarily to the new share issue and reflects the expectation that the insurer financial strength ratings on the group’s core insurance subsidiaries will be upgraded by one notch at the time of resolution, the agency said.

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