“Focus on customers and do the right thing for a long time”, “keep pace with the times and be curious about new things”, “people-oriented, striver is the most valuable asset” – these are the themes of three learning posters posted in Ping an asset management. In just 39 words, the importance of business philosophy to enterprise development can be seen. Even the “elephant” with an asset management scale of 4 trillion is regarded as the standard.
It was Huang Yong, the new chairman of Ping an asset management, who took the lead in setting off this “learning style”. As a veteran of Ping An, he is familiar with the company’s business and internal processes, but at the same time, he is also familiar with: in the rapidly changing environment, if an enterprise wants to strengthen the “moat” of its core competitiveness, the key is to have the internal driving force of “following the trend, growing against the trend and changing in response to the trend”. This is also the “spark” that he has collided with the team members in the past two months.
At the juncture of the first year of the implementation of the new regulations on asset management, and at the moment when the epidemic and market environment accelerate the process of each asset management subject to solve the problem of new business drivers, peers, investors and even regulators are also concerned about whether this head insurance asset management company can set a benchmark again in the era of comprehensive competition.
Recently, after the disclosure of the group’s annual report, Huang Yong accepted an exclusive interview with a reporter from Shanghai Securities News. From the development roadmap of Ping an asset management described by him, this will be an “internal revolution” of “seeking refinement in slowness, refinement in refinement and simplicity in refinement”, which is related to the future fate of Ping an asset management.
direction is right, “slow is fast”
The current global economic and market environment has complex multi cycle superposition characteristics, which makes it impossible for any policy and decision-making to be implemented and promoted in one battle.
This is the case in the general environment, as well as in all fields. In Huang Yong’s view, as an insurance asset management company, it is necessary to “build a hard stronghold and fight a stupid battle”. It is necessary to polish and adjust the mentality, maintain the accumulation of progress and advantages, and be able to “build a hard stronghold” and “fight a stupid battle” through a regular and self-discipline way of work.
The key is that the direction should be right, “slow is fast”. Huang Yong said that the so-called “right direction” means to obtain absolute benefits and keep the risk bottom line.
He believes that since the main funds managed by insurance asset management institutions are still insurance funds, from the perspective of the capital liability attribute of “long term and large scale” of insurance funds, it determines that the investment system of insurance asset management companies must be guided by long-term stable absolute income, and build the ability to obtain long-term absolute income based on the uniqueness of investment system, process and method.
“In terms of methodology, my consistent proposition is to do the right thing for a long time and become a friend of time.” He believes that asset management is an industry where slow work produces meticulous work. Many things need to be accumulated and adhered to. It may not be effective in three or five years, but if it is adhered to, it may be effective in eight or ten years.
This investment in China Yangtze Power Co.Ltd(600900) is the confirmation of Ping an asset management’s long-term investment philosophy. In 2015, due to the market shock, Ping an asset management participated in China Yangtze Power Co.Ltd(600900) fixed growth against the trend and became the top ten shareholders of the latter. At that time, when the concept of ESG had not yet sprung up, Ping an asset management was firmly optimistic about this hydropower industry giant developing clean energy for a long time. It not only made a lot of profits, but also practiced the ESG investment concept, and was praised by investors as a model of “value investment”.
Slow in the fine, fine in the fine. Since taking office this year, it coincides with the most complex investment environment, and insurance funds should keep the risk bottom line. As soon as Huang Yongfu took office, he took the lead in establishing a credit risk early warning mechanism within ping an asset management – “Eagle Eye plan”, which means “golden eyes”.
He told reporters that according to this plan, Ping an asset management will regularly “scan” its position assets to effectively identify problematic position varieties, and then the risk control department will be responsible for disposal. “We hope that through this’ eagle eye plan ‘, we can find and dispose of risky assets three months in advance.”
“If the company is compared to a car, the early warning and handling mechanism is the brake, and the investment is the throttle. You can’t just have the throttle without the brake. The data show that since the implementation of the eagle eye plan, the effect has been very good, most risks can be disposed of in advance, and the loss rate will be relatively small.” He said.
concept is correct, “take a longer way”
With the “hard stronghold”, we can attack and defend.
Winning by stability does not mean seeking stability mechanically. Huang Yong has deep feelings about this. In his view, the deep meaning behind this means that we should judge the situation, find the coincidence point between “stability” and “progress”, and grasp the balance, opportunity and scale between grasping opportunities and risk prevention and control.
On the basis of serving the main business well, it is the breakthrough point of Ping an asset management to actively participate in the wealth management market and expand the third-party business. “In terms of proportion, at present, our third-party business accounts for more than 10%, and our long-term goal is to benchmark international insurance information management giants.” He said frankly.
The third-party business capability is also a footnote to the competitiveness of asset management institutions. He said that the development of third-party business is actually to deeply participate in the competition in the large asset management market, test and improve the core competitiveness in the market-oriented competition. “Only by deeply participating in market competition can we improve investment ability and service level; only by actively expanding external customers can we really manage insurance funds and win the recognition and respect of internal clients.”
This is also the consensus within the entire insurance asset management industry. This year is the first year of the implementation of the new regulations on asset management. The new regulations on asset management bring not only rectification, but also the opportunity to compete on the same stage on the starting line with other wealth management institutions.
Opportunities are always reserved for those who are prepared. Ping an asset management began to carry out third-party business in 2006 and has been growing steadily year by year. “At present, the number of customers and the scale of entrusted management are at the forefront of all insurance asset management companies in the market. Our current types of customers include banks, insurance, large and medium-sized enterprises, overseas institutions, etc.”
He revealed that in the future, in the process of third-party business development, it will develop its strengths and win-win cooperation with other types of asset management institutions. “For example, after the new regulations on asset management, the net value transformation of bank financial management subsidiaries is under great pressure, and products with low volatility and absolute return characteristics are urgently needed. The ability advantages of insurance asset management companies can meet the configuration needs of bank financial management and provide more diversified products and investment advisory services for financial management subsidiaries. In addition, we are also trying to cooperate with bank financial management subsidiaries to issue joint fof products to achieve the effect of to C through to B.”
In the interview, he also talked about the opportunities of the third pillar of pension in the future, namely commercial pension insurance fund management and pension wealth management business. This is also regarded by various asset management institutions as a “new outlet” in the era of large asset management.
In 2020, the Interim Measures for the administration of insurance asset management products gave the insurance asset management institutions the position of the supplier of medium and long-term financial products, and made the basic pension, social security fund, enterprise annuity and other pensions explicit as product investors, which is an affirmation of the insurance asset management institutions in pension management.
In terms of ability, Ping an asset management has accumulated rich asset allocation ability, long-term fund management ability and absolute income acquisition ability in long-term investment practice.
From experience, Ping an asset management has established a complete asset management product line in the past years. Most products are customized according to the investment needs of pension funds, and have excellent historical performance. Referring to international experience, insurance asset management companies are also the mainstream management institutions of pension funds.
In Huang Yong’s view, insurance asset management institutions are ready in terms of investment strategy and investment ability. “In the future, insurance asset management companies can help the construction of the third pillar of pension by developing Pension Asset management products. In addition to providing investment advisers and underlying assets to bank financial subsidiaries, insurance asset management, as an important force in the asset management market, hopes to contribute to the cause of pension.”
full of vitality, “bearing heavier responsibilities”
The greatness of peace comes out with feet. Its success comes not only from the rush thinking of “winning time”, but also from the efficient execution of “rapid change”, but also from closely following the general trend of China’s economic transformation and adhering to the concept of “financial essence serving the real economy”. By the end of 2021, Ping An group had invested more than 5.9 trillion yuan to serve the real economy.
As an important export of Ping An Group’s investment side, Ping an asset management has increasingly realized the connotation of solidarity between enterprises and social development. In Huang Yong’s view, as an important institutional investor in China’s capital market, insurance asset management is duty bound to serve the real economy and support national construction.
He told reporters that taking ESG investment as an example, Ping An Group joined the “principle of responsible investment (unpri)” in August 2019. From the perspective of organizational structure, the group has established a green finance committee to coordinate strategy, planning and system, set up a green finance office under it, and all professional subsidiaries have also set up a green finance office to clarify the rights and responsibilities of all levels and implement the ESG concept and strategy from top to bottom.
“Ping an asset management will actively participate in ESG investment from three aspects.” He revealed that first, we should continue to invest in green assets and provide financing support through various channels for green and low-carbon transformation enterprises; Second, strengthen the development of green ESG products; Third, build an ESG methodology in line with its own development reality. “We have two ESG products under planning. At present, the product team is determining the ESG strategy, method and benchmark, and tracing the winning rate compared with the benchmark.”
In addition, in terms of serving the real economy and supporting national construction, he revealed that in the future, Ping an asset management will focus on financial support for the construction of “two new and one heavy” projects, especially increasing the layout of strategic emerging industries such as new energy, high-end equipment, new energy vehicles and green environmental protection, better allocating insurance funds to the “growth engine” of China’s economy and helping to achieve high-quality and stable growth.
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