Dubang Property&Casualty Insurance, whose solvency is not up to the standard, adjusted a capital increase plan launched two years ago.
On May 22, DuPont Property and Casualty Insurance Co., Ltd. (hereinafter referred to as DuPont Property and Casualty Insurance) announced that the company would hold the first extraordinary general meeting of shareholders in 2014 on May 11, 2024, at which the Proposal on Adjustment of Capital Increase and Share Expansion of the Company was reviewed and approved. For this capital increase, each shareholder will invest a total of 244080420 yuan in currency to the company. After this capital increase, the company's registered capital will increase from the current 2.7 billion yuan to 2944080420 yuan.
In May 2022, DuPont Property&Casualty Insurance Co., Ltd. launched a capital increase plan. It plans to issue 400 million additional shares at a unit price of 1 yuan per share, which will increase the registered capital by 400 million yuan in total and increase the registered capital from 2.7 billion yuan to 3.1 billion yuan. All shareholders increase their capital in proportion to their equity. At that time, 9 existing shareholders planned to participate in the capital increase, including 6 state-owned shareholders and 3 private enterprise shareholders. However, after 9 shareholders participated in the capital increase, there were still 116.1 million shares not subscribed by shareholders, and DuPont Property Insurance said that it should enter the next round of capital increase in the same proportion.
However, the above capital increase plan has not been approved by the regulatory authorities.
From this newly adjusted capital increase plan, it can be seen that only 6 state-owned shareholders are left to participate in the capital increase, and the previous 3 private enterprise shareholders are no longer involved. If this capital increase is approved, the current shareholder ranking of DuPont Property Insurance will remain unchanged, but the proportion of state-owned shareholders will further increase from 59.55% to 62.91%.
Dubang Insurance was established on October 19, 2005, with a registered capital of 2.7 billion yuan, and its registered address is Jilin City, Jilin Province. The company has 14 shareholders, including 6 state-owned shareholders and 8 private enterprise shareholders.
Among the shareholders, 7 shareholders hold more than 5% shares. Among them, Jilin Railway Investment and Development Co., Ltd., which is controlled by the State owned Assets Supervision and Administration Commission of Jilin City, Jilin Province, holds 19.26% of the shares, making it the largest shareholder; Zhongtai Trust holds 19.07% shares, making it the second largest shareholder; Jilin Jisheng Financial Investment Holding Group Co., Ltd., wholly-owned by the State owned Assets Supervision and Administration Commission of Jilin City, holds 12.52% of the shares, making it the third largest shareholder; Jilin Urban Construction Holding Group Co., Ltd. under the State owned Assets Supervision and Administration Commission of Jilin City holds 12.04% shares, Jilin Jindu Group Co., Ltd., a private enterprise, holds 11.11% shares, Jilin Jinying Investment Co., Ltd. and Jilin Zhonghaoqun Industrial Co., Ltd., which are wholly-owned by the State owned Assets Supervision and Administration Commission of Jilin City, hold 7.22% and 5.19% shares respectively.
It is worth noting that, according to the main resolutions of the shareholders' meeting disclosed by DuPont Property&Casualty Insurance in the past three years, many shareholders have been absent from the meeting for many times, and when voting on relevant proposals, some shareholders often cast negative votes or abstained from voting. In July 2022, DuPont Property&Casualty Insurance held a video conference of the 2002 Extraordinary General Meeting of Shareholders. Nine shareholder units opposed the Proposal on Deliberating and Amending DuPont Insurance's Articles of Association and Related Annexes, accounting for 71.13% of the total voting shares present at the meeting.
In terms of senior management allocation, DuPont Property&Casualty Insurance currently has only four senior managers, including Yu Hui, Vice President, Chief Risk Officer, Chief Information Officer, Sun Kai, Assistant to the President, Xu Shan, Secretary of the Board of Directors and Head of Compliance, Zhao Haiyang, Chief Actuary, Chief Investment Officer, Professional Principal of Investment Business and Professional Principal of Overseas Investment Business. The last three will be approved by the regulatory authorities in 2023.
According to the solvency report of DuPont Property&Casualty Insurance in the first quarter of 2024, as of the end of the first quarter, the company's core solvency adequacy ratio and comprehensive solvency adequacy ratio were both 122.3%, and the comprehensive risk rating of the last two periods was C, so it was an insurance company with substandard solvency.
As for the comprehensive risk rating of C, DuPont Property&Casualty Insurance said that the first is the risk that can be capitalized, the solvency adequacy ratio is continuously lower than 150%, and the proportion of endogenous capital is at a low level. Second, poor corporate governance results led to low operational risk scores. Third, indicators such as profit and loss, premium growth, reported and outstanding loss reserve development deviation rate, and case filing and cancellation rate were at a low level in the industry rankings. To sum up, it is mainly due to poor operation, declining profitability, low solvency adequacy ratio, and certain problems in corporate governance and other operational risks.
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