Insurers invest P10B in various financial instruments last year

The country’s insurance industry invested at least P10.16 billion in various investment instruments including government bonds, corporate bonds, eurobonds, corporate loans, bank notes, government securities, capital markets, and commercial papers in 2001.

In 2000, the 40 life insurers invested a minimum P14.84 billion or a 31.5 percent better than last year.

Insurance Commission (IC) explained however that the P10.16 billion was just a portion of the entire investments portfolio made by the industry. It pointed out that the industry has not completed making or submitting its report to the IC.

"We would like to believe that the industry made as much or greater investments than in 2000," officials said.

Of the total investments reported, P6.963 billion were made through peso-denominated instruments while another $62.7 million in US dollar-denominated ones.

Biggest appetite for dollar-denominated investment instruments was the Insular Life Assurance Co. (Insular Life) getting involved in a global balanced fund project worth $25 million.

Also with huge confidence in dollar-denominated instruments were the Philippine American Life and General Insurance Co. Inc. (Philamlife), and the Malayan Group of Companies.

Philamlife gobbled up a total of $12-million worth of various instruments including the High-Yield Reserve Asset (HYRA) and Philippine eurobonds with long-term maturities.

The Malayan group, including the Malayan Insurance Co. Inc., the Malayan Reinsurance Corp., the Malayan Zurich Insurance Inc. Co., and the Tokio Marine Malayan Insurance Co. Inc., accumulated a total of $10 million in various instruments including the eurobonds and global bonds of the Bangko Sentral ng Pilipinas (BSP).

The Manufacturers Life Insurance Co. Inc. (ManuLife) settled for $6.6-million investments in US-government bonds and US dollar-denominated Treasury bills.

In 2000, the single biggest dollar-denominated investment was initiated by the Malayan Zurich Insurance Company Inc. for Citibank’s PEDRO investment product worth $50 million.

Single biggest investment in a peso-denominated instrument was made by Philamlife to a combined tune of P1.3 billion.

These are broken down as follows: a mortgage loan with the Kapatiran Realty Corp. worth P400 million; another P400 million on an ABS-CBN five-year exchangeable notes; P129.8 million for the purchase of additional shares of subsidiary Philam Savings Bank; roughly P3.5 million as equity investment in Philam Towers Management Corp.; and P500 million for a fixed rate corporate note made by Globe Telecoms.

Not to be outdone is the National Reinsurance Corporation of the Philippines (National Re) which invested P760 million for short-term commercial papers and government securities.

ManuLife put their money worth P500 million on Philippine Fixed Rate Promissory Notes (FXPN) with maturity dates on 2004 and 2006. Also putting in a similar P500 million on a loan with telecommunications giant Globe Telecommunications Inc. was Sony Life Insurance (Phils.) Inc.

Single biggest total transaction on peso-denominated instruments occurred in February 2001 with a total amount of P1.1 billion buoyed by the combined investments made by CMG Life Insurance Co. Inc., Insular Life, and Philamlife.

In 2001, the single biggest investment by a company in a given month was the P710 million made by the National Re. In April of that year, it invested in P700 million in short-term government securities under a repurchase agreement and another P10 million on short-term commercial papers and promissory notes.

Biggest-peso denominated monthly investment was noted in January 2000 worth P1.426 billion. This was anchored on the P492.1-million common share acquisition by PhilamLife on the then Equitable Bank (P120 million) and AIG Credit Card Co. Philippines Inc. (P377.1 million).

In the same month, Great Pacific Life Assurance Corp. (Grepalife) invested P313.2-million in short-term commercial papers of the First Malayan Leasing and Financing Corp. and acquired shares of stock of YGC Corporate Services Inc.

Biggest dollar-denominated investment in a given month, was recorded in October 2000 amounting to $62.897 million.