Anbang Insurance has appointed a group chief investment officer and chief financial officer amid other leadership changes, as the Chinese group looks to consign its recent troubles to the past and become a well-run, traditional insurer (see box below).
Pu Jingsu, formerly head of portfolio management for Asia at Metlife Investment Management, became Anbang’s group CIO this month, according to his LinkedIn profile. His Hong Kong regulatory licence at US insurer Metlife’s investment arm ceased on March 29.
Pu has moved from Hong Kong to Beijing for the new role, a well-placed industry source told AsianInvestor.
He now oversees a $300 billion portfolio at Anbang, while at Metlife IM in Hong Kong he had been responsible for $100 billion of assets in Asia, his LinkedIn profile shows.
Anbang did not reply to AsianInvestor queries for this story, and Pu could not immediately be reached for comment.
Pu's role as group CIO is understood to be a newly created title at Anbang.
Jia Ying was CIO previously, but most investment decisions had been made by then chairman and chief executive Wu Xiaohui, an insurance executive familiar with the firm told AsianInvestor on condition of anonymity.
Wu was was sentenced to 18 years in jail for financial fraud in May last year, and a new chairman and CEO has not yet been announced.
The rest of the leadership team was also dismissed as part of the government-ordered clearout.
The new CFO came on board last month, in the form of Zhou Guoduan, the former CFO of Chinese insurer Taikang Life, said the executive familiar with Anbang.
Taikang Life could not be reached for comment.
The appointment of an investment veteran with international exposure is seen as instrumental for Anbang’s change to become a well-run, true liability-driven insurer and investor.
“Anbang used to be a big mess. It made a lot of [risky] investments, its ex-chairman was jailed … Pu can bring his expertise in strategic asset allocation to Anbang, bring international management culture to Anbang,” the first unnamed industry source said.
Metlife will announce a replacement for Pu soon, and Chuck Scully, head of investments for Asia, is taking care of his former duties on an interim basis, a spokeswoman for the US insurer said.
Before becoming head of portfolio management for Asia, Pu was vice president of global portfolio management at Metlife Financial Services, when his responsibilities included developing and implementing hedging overlays alongside asset-liability management strategies. He has also worked for Swiss Re, Aviva USA and PricewaterhouseCoopers.
ANBANG’S EPIC FALL
Anbang’s explosive rise and equally spectacular collapse is one of a kind in the Chinese insurance industry.
The privately held insurer amassed assets worth Rmb2.5 trillion ($372 billion) by August 2017 since its founding in 2004, according to an estimate by UBS.
It had a simple strategy: offer short-term and high-yielding investments packaged as insurance products to raise funds and use them to make global acquisitions, among them the $1.95 billion purchase of the Waldorf Astoria Hotel in New York.
Its dramatic fall from grace happened early last year when the Shanghai Prosecution Service announced it would prosecute Wu for fraudulent fundraising activities and misuse of his position – a rare case in China of a company head being charged over a business’s wrongdoing.
Shortly after that, the insurance regulator announced it would lead a working group to seize control of Anbang for the next 12 months. On February 22 this year, the China Banking and Insurance Regulatory Commission said it would retain control of Anbang for another year.
Anbang reportedly tried to sell off its overseas assets after the takeover.
Most recently, South Korea’s Woori Financial Group said on April 8 that it had agreed to acquire Seoul-based firms Tongyang Asset Management and ABL Global Asset Management – both owned by Anbang – through a stock purchase agreement. The insurer was also said to be exploring sale of the Manhattan office tower.
It is important for Anbang to unwind such positions if it is to become a true liability-driven investor, as illiquid assets such as real estate can pose big cash flow mismatch risks for any insurer.
Anbang’s downfall was also seen to have triggered tighter regulations in the China's insurance industry. Shortly after it arranged the state takeover of Anbang, the insurance regulator introduced an overarching framework to rein in insurers’ asset-liability management risks.
The new approach is intended to discourage insurers from similar malpractice and high-risk growth strategies, Zhu Qian, senior credit officer at rating agency Moody’s, told AsianInvestor.