BEIJING, March 20 -- China Life Insurance Co and Ping An Insurance (Group) Co, the nation's two largest insurers, paid a combined 10.8 billion yuan (1.4 billion U.S. dollars) for about 10 percent of China Minsheng Banking Corp.

    China Life and Ping An each paid 5.4 billion yuan for 600 million shares, Minsheng Bank said in a statement yesterday. The Beijing-based lender raised 18.16 billion yuan selling two billion shares to seven corporate investors.

    China is letting insurers and banks enter each other's markets, unwinding a ban on cross-industry ownerships that has been in place since 1993, according to Bloomberg News.

    Bank of Communications Ltd and China Construction Bank Corp are among the lenders that have applied to the government for authorization to set up insurance ventures.

    Shenzhen-based Ping An is seeking to build a financial services group that will get two-thirds of its revenue from banking, securities and asset management. For the six months ended June 30, those businesses accounted for about eight percent of Ping An's net income.

    The insurer last year bought 89 percent of Shenzhen Commercial Bank. Last month, HSBC Holdings Plc said Ping An was buying its 27 percent stake in subsidiary Ping An Bank.

    China's insurers returned 5.8 percent on their investments last year, 2.2 percentage points more than in 2005, according to the China Insurance Regulatory Commission. The companies profited from a doubling in stock prices on the Chinese mainland.

    Insurers own 30.5 percent of the yuan shares of Industrial and Commercial Bank of China Ltd, the nation's biggest lender, and 23.2 percent of Bank of China's stock, according to the regulator.

    Minsheng, founded by 59 investors including pig-feed tycoon Liu Yonghao, averaged a 40 percent annual increase in profit in the past five years.

    (Source: Shanghai Daily)