Anbang Insurance Gets Green Light to Start Bankruptcy Proceedings

00:00

00:00/00:00

Listen to this article 1x

Visitors learn about Anbang Insurance’s business at the Beijing International Financial Expo in January 25. Photo: VCG

China has given the green light to Anbang Insurance Group Co. Ltd. to start bankruptcy proceedings, marking the latest step in the government’s years-long efforts to manage the collapse of the sprawling financial conglomerate.

The National Financial Regulatory Administration, China’s top financial regulator, announced the in-principle approval on Friday. The go-ahead came nearly four years after the insolvent Chinese insurer announced its decision to liquidate.

You've accessed an article available only to subscribers

Subscribe today for just $.99.

VIEW OPTIONS

Unlock exclusive discounts with a Caixin group subscription — ideal for teams and organizations.

Subscribe to both Caixin Global and The Wall Street Journal — for the price of one.

Share this article

Open WeChat and scan the QR code

DIGEST HUB

Digest Hub

Back

Explore the story in 30 seconds

China approved Anbang Insurance Group's bankruptcy proceedings after nearly four years of insolvency.
Anbang, with debts exceeding assets by 82.8 billion yuan in 2018, saw a government takeover and CISFC's 60.8 billion yuan bailout.
Efforts to sell Anbang's assets, including creating Dajia Insurance, faced challenges, prompting a strategy shift to sell units separately.

AI generated, for reference only

Who’s Who

Anbang Insurance Group Co. Ltd.: Anbang Insurance Group Co. Ltd. was a Chinese insurance conglomerate that expanded rapidly through debt-fueled investments, including purchasing New York's Waldorf Astoria hotel. The government took over the company in 2018 due to its significant financial troubles and high liabilities. Founder Wu Xiaohui was imprisoned for fraud. Efforts have been underway to manage its bankruptcy and sell its assets. Dajia Insurance Group was created to handle Anbang's remaining assets and operations.

China Insurance Security Fund Co. Ltd.: China Insurance Security Fund Co. Ltd. (CISFC) is a state-run bailout company that injected 60.8 billion yuan into the debt-ridden Anbang Insurance Group in 2018. CISFC created Dajia Insurance Group Co. Ltd. to handle Anbang’s assets and operations, holding 98.2% of Dajia’s shares. The company has been attempting to exit its investment by selling off Dajia’s assets, either as a single entity or in separate units.

Dajia Insurance Group Co. Ltd.: Dajia Insurance Group Co. Ltd. was created in 2019 with a registered capital of 20.4 billion yuan to manage Anbang Insurance Group's assets and operations. China Insurance Security Fund Co. Ltd. (CISFC) holds 98.2% of Dajia’s shares. The group includes Dajia Annuity Insurance Co. Ltd., Dajia Property and Casualty Insurance Co. Ltd., a life insurance subsidiary, and an asset management unit. CISFC has attempted multiple times to sell Dajia’s major businesses, but those efforts have largely been unsuccessful.

Dajia Annuity Insurance Co. Ltd.: Dajia Annuity Insurance Co. Ltd. is a unit of Dajia Insurance Group Co. Ltd., created to manage Anbang Insurance Group's assets and operations after its takeover. Earlier this year, Dajia sought buyers for both its annuity unit and property insurance arm, marking a strategic shift to allow China Insurance Security Fund Co. Ltd. (CISFC) to exit its investment faster. This comes after several failed attempts to sell Dajia’s major businesses as a single entity.

Dajia Property and Casualty Insurance Co. Ltd.: Dajia Property and Casualty Insurance Co. Ltd. is part of Dajia Insurance Group, which was created to handle Anbang Insurance's assets and operations. Despite attempts to sell Dajia's major businesses, including the property and casualty insurance arm, these efforts have been unsuccessful due to declining interest in insurers amid weak investment returns. Early this year, Dajia began seeking separate buyers for its annuity unit and property insurance arm.

AI generated, for reference only

What Happened When

2004：: Anbang Insurance Group Co. Ltd. started its life as a minor car insurer.

2014：: Anbang's debt-fueled expansion took off as it started selling high-yield investment products known as universal life insurance products.

2018：: Anbang's total assets rapidly boosted to more than 3 trillion yuan.

2018：: State-run bailout company China Insurance Security Fund Co. Ltd. injected 60.8 billion yuan into the debt-ridden insurer.

2018：: Wu Xiaohui, Anbang’s founder, was sentenced to 18 years in prison for fundraising fraud and embezzlement.

February 2018：: The government took over Anbang Insurance Group Co. Ltd. and began defusing its debt crisis.

June 2018：: Anbang's liabilities were 82.8 billion yuan greater than its assets.

2019：: Dajia Insurance Group Co. Ltd. was created with a registered capital of 20.4 billion yuan to manage Anbang’s assets and operations.

2021：: An attempted asset sale of Dajia by CISFC did not attract a single bidder.

January 2024：: Dajia started looking for buyers for both its annuity unit and property insurance arm.

August 2, 2024：: The National Financial Regulatory Administration gave in-principle approval for Anbang Insurance Group Co. Ltd. to start bankruptcy proceedings.

AI generated, for reference only