"I totally support Ping An's refinancing plan," an agitated shareholder from Inner Mongolia shouted out at the company's extraordinary general meeting on March 5. "With the money raised, we can get good bargains in overseas assets. So, why shouldn't we vote for the plan?"

Though he had suffered a loss of more than 35 percent on Ping An shares, which dropped after the insurance company floated the refinancing plan, he didn't seem to much care for it. "Shareholders should take a long-term view!" he added. Some 92 percent of Ping An shareholders evidently thought the same, clearing China's largest corporate offering plan even after it was widely blamed for pulling down the stock market for fears that it might soak up far too much liquidity. The rationale of shareholders was simple: now is the time to pick up quality overseas assets and Ping An needs the cash to go shopping.

"International financial giants are all good at seizing opportunities when they come their way, and if Ping An has to be an international player, it has to do the same," says Ma Mingzhe, chairman of Ping An Insurance (Group) Company Ltd.

This ambition of one of China's largest financial holding companies is not unique. Managers of many Chinese financial institutions have been racking their collective brains over the past months trying to figure out how to make the best of the ongoing turmoil in the US and European markets.

Global financial giants have been hit hard by the subprime crisis in the US. By the middle of January, the market value of Citigroup had shrunk 52 percent while that of JP Morgan was down 14 percent. Earlier this month, HSBC unveiled a massive $17.24 billion bad-debt provision to cover for its subprime losses. The low market valuation naturally makes these high priests of international finance prime candidates for picking by ambitious, cash-rich Chinese financial institutions.

After Ping An announced its plan to issue up to 1.2 billion new A shares and convertible bonds with warrants that could raise some $17 billion, the company's A shares fell from 98.21 yuan on January 21 to 67.66 yuan on March 7. Lion Fund Management Co Ltd, one of Ping An's largest holders of tradable shares, voted against the company's mega share sale plan.

"Given our customers' interests, we blackballed the refinancing plan," says a source with Lion Fund. "Besides, there are still too many uncertainties surrounding Ping An's investment projects, which may bring larger business risks to the company."

Last year, Ping An paid $2.7 billion for a 4.2 percent stake in Dutch-Belgian financial firm Fortis NV, becoming its single largest shareholder. Market sources say Ping An may also consider buying a stake in British insurer Aviva or Prudential after the refinancing.

Question of timing

"A number of international financial institutions offer a good chance for investment right now, given their current P/E (price-earning) and P/B (price per book value) ratios, which are much lower than the average of domestic ones," says Ma Xuguo, deputy general manager of the global market department of Industrial and Commercial Bank of China (ICBC), the country's largest lender.

International financial institutions' average P/E ratio usually hovers around 10, while that of the ICBC and Bank of China stood at 25.2 and 23.1 on March 7.

"But the problem is that we don't know if the worst is really over," says Ma.