China Life, the world’s largest life assurer, is eyeing overseas acquisitions as it seeks to take advantage of the global financial crisis to gain a foothold in foreign markets.

Liu Lefei, chief investment officer, said the crisis in financial markets was not yet over, but China Life believed the moment to begin making overseas investments was fast approaching.

“We are cautiously but actively looking for M&A opportunities,” Mr Liu said in an interview with the Financial Times. “We have been doing a lot of research and the opportunities are becoming more and more obvious.”

China Life has yet to make any overseas strategic investments, and its investment portfolio is also almost entirely domestic.

Potential targets were more likely to be small or medium-sized financial groups and could be anywhere in the US, Asia and Europe. He also said large financial groups that had run into trouble were likely to start selling off non-core assets. “Over the next few months, we believe there will be a lot more merger and acquisition activity,” he said.

China Life has been mentioned as a potential buyer for parts of AIG’s Asia-Pacific business if the troubled insurance group puts the assets up for sale.

However, bankers said the group might also prefer to take small stakes that could be both a financial investment and a platform for future acquisitions once it is more comfortable overseas.

The comments are the first public sign from a large, well-funded Chinese financial group that the recent market chaos is seen as a window to make opportunistic investments.

Chinese groups made a number of high-profile investments last year in overseas financial groups before the worst of the credit crisis hit the sector.

China Investment Corp bought stakes in Blackstone and Morgan Stanley, which have dropped sharply in value. Ping An Insurance made the first overseas investment by a Chinese insurer when it bought a 5 per cent stake in Belgo-Dutch group Fortis, which was later partly nationalised. The group booked a Rmb15.7bn ($2.3bn) loss on the Fortis investment.

China Life, the country’s largest insurer and a big institutional investor, had previously said it would focus more on its fast-growing home market rather expand aggressively overseas. At the end of September, the group had Rmb30.5bn of cash on its balance sheet.

In recent months, Chinese officials have signalled that big investments in overseas investment groups were now on hold. However, Mr Liu said that the group had not been barred from making acquisitions.

Speaking at a conference in Shanghai yesterday, Jin Liqun, chairman of the supervisory board of CIC, said: “While there are apparently huge risks lurking in the way ahead, this provides at the same time huge investment opportunities.”

He added: “In the short term you may see some slowdown in Chinese investment overseas . . . but I don’t think we should all close our doors because of the risks.”

Howard Chao, an M&A expert at the law firm O’Melveny & Myers, said that Chinese companies would probably not face political problems if they bid for insurance groups in the US.

“It should be doable to acquire a mid-sized insurance company in the US,” he said. “Taking control of a US bank is still going to be sensitive. But even a substantial minority stake should be possible.”