China's social security fund finds profitability in bank subsidiary investment

The National Council for Social Security Fund (SSF) will make equity investments in bank's subsidiaries engaging in innovative businesses, the council's vice-chairman said on Friday.

Wang Zhongmin, vice-chairman of the SSF, said investing in banks' subsidiaries with financial licenses has been proved to be profitable.

"Our average annualized rate of return in this type of equity investment is about 11.5 percent, which is very profitable," said Wang. "We will continue to make such investments in the future."

Wang added that SSF manages assets totaling about 2.2 trillion yuan ($325 billion) and its annualized rate of return in the past 10 years is 8.37 percent.

"We have earned more than 800 billion yuan in a total, and banks make a big contribution to our investment return," Wang said at an annual meeting held by China Banking Association in Beijing.

Wang said SSF's cooperation with Chinese banks include participating in State-owned banks' shareholding reforms, trust business and saving agreements.