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08:26, 10-Aug-2017
Chinese insurer invests in maker of country's first homegrown jetliner
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A cooperation agreement signed between China's Huatai Insurance Group and the Commercial Aircraft Corporation of China (COMAC) on Wednesday will see 15 billion yuan (2.25 billion US dollars) of insurance funds invested in a homemade passenger jet project.
Under the agreement, the investment will be made through a 10-year renewable debt investment plan.
The Commercial Aircraft Corporation of China (COMAC) is the manufacturer of the C919, China's first domestically designed and built large passenger jet.
Commercial Aircraft Corporation of China (COMAC) is the maker of C919, China's first homegrown large passenger jet. /CFP Photo
Commercial Aircraft Corporation of China (COMAC) is the maker of C919, China's first homegrown large passenger jet. /CFP Photo
According to the deal, the insurance fund provided by Huatai Asset Management, the investment arm of Huatai Insurance Group, will be used in investment, construction and operation of COMAC's civil aviation projects.
This is the first such investment made by insurers to COMAC, and the aviation manufacturer can choose to renew the plan when the investment matures 10 years later.
The debt investment plan marks a significant step in the support from insurance funds to the real economy and emerging strategic industries, which fit COMAC's great need for initial investment, according to COMAC board chairman He Dongfeng.
Huatai Insurance Group. /CFP Photo
Huatai Insurance Group. /CFP Photo
"R&D and production of passenger jets demand long-term and persistent input of personnel, technology and funds, and insurance funds can meet such demands as they are large in scale and stable in supply", Chen Wenhui, vice chairman of China Insurance Regulatory Commission (CIRC) pointed out.
China's insurance regulator has expected insurance funds to invest in major projects that will play a significant role in boosting the economy, rather than using leveraged money on short-term speculation.
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Shanghai-based manufacturer of the C919.