Agricultural Bank of China and Taiping Life Insurance Co., Ltd. signed a deal on the bank's buying Taiping Life's all 1.5 billion yuan of subordinated debts.

The deal was signed in Shenzhen, Guangdong Province in south China, on October 23, 2005.

According to the nation's Temporary Measures for Administration of Subordinated Term Debts of Insurance Companies, "subordinated debts" refers to debts with a maturity term of more than five years (including five years) issued with approval by an insurance company by way of private placement that are junior to the policy liabilities and other obligations of the company but senior to the company's equity in terms of the ranking of principal repayment and interest payment.

As approved by China Insurance Regulatory Commission, the duration of Taiping Life's debts issued this time is eight years.

Agricultural Bank is confident in the solvency Taiping Life, a well-managed, fast-growing life insurance company, said head of the bank Yang Mingsheng.

The deal heralds all-round and deep cooperation between the two companies in bancassurance.

By People's Daily Online