NCI(SH:601336) Guo Ji Jin Rong Bao·2025-12-19 15:40Core Viewpoint - The issuance of perpetual bonds by insurance companies is accelerating as they seek to strengthen their capital base in response to regulatory requirements and market conditions [1][2][4]. Group 1: Recent Bond Issuances - On December 18, Great Wall Life successfully issued 1 billion yuan of perpetual bonds with a coupon rate of 2.70% [1]. - In December, several insurance companies, including Ping An Life and Dongwu Life, issued perpetual bonds or capital supplement bonds, totaling 23.5 billion yuan [1][3]. - The issuance of bonds is primarily aimed at enhancing the solvency levels of these companies and supporting sustainable business development [3][4]. Group 2: Factors Driving Bond Issuance - The acceleration in bond issuance is attributed to multiple factors, including the end of the transition period for the "Solvency II" regulations, which has increased the urgency for capital replenishment [2][4]. - New accounting standards have intensified the volatility of solvency ratios, prompting companies to issue bonds to stabilize regulatory metrics [4]. - The need to reserve capital for business development and to support growth in the following year is also a significant internal demand [4][5]. Group 3: The Role of Perpetual Bonds - Perpetual bonds have emerged as a key financing tool for insurance companies, with a total issuance of 35.77 billion yuan in 2023 [6]. - The issuance of perpetual bonds is concentrated among large and medium-sized insurance firms, as they meet the higher issuance criteria compared to smaller companies [7]. - Insurance companies must meet specific conditions to issue perpetual bonds, including maintaining a solvency ratio of at least 100% and ensuring that the balance of perpetual bonds does not exceed 30% of core capital [7]. Group 4: Long-term Capital Strategies - While bond issuance provides short-term capital relief, the insurance industry must focus on enhancing its internal capital generation capabilities for sustainable growth [8]. - Companies are encouraged to optimize their business structures, improve operational efficiency, and manage assets and liabilities effectively to achieve long-term stability [8][9]. - Emphasizing high-value protection and long-term savings products, along with prudent investment strategies, is essential for improving core profitability and ensuring a solid foundation for future growth [8][9].