Ping An Insurance Group said it will issue 26 billion yuan ($4.2 billion) in convertible bonds to boost its capital reserves.

The China Securities Regulatory Commission will start its final review of the bonds on Wednesday, according to a statement on the CSRC's website.

The six-year convertible bonds will have a coupon rate lower than 3 percent.

Industry insiders said that the solvency rates of Ping An's life insurance and property insurance business units are good, thus the funds raised through the bonds will likely be used to increase the capital in Ping An's banking sector.

Ping An's net profit increased 3 percent in 2012, the lowest growth rate in three years, as strong growth in its banking business was offset by a decline in its major insurance business.

Its banking unit completed the acquisition of Shenzhen Development Bank last year, giving it a substantial increase in customers.

The banking business raked in 13.51 billion yuan in profits during the year, up more than 30 percent year-on-year, and contributed 6.87 billion yuan to the group's profits.

But the bank's overall balance sheet weakened on the back of rapid growth in loans, increasing the need for a capital injection.

Earlier this year, Ping An's former shareholder HSBC sold its $9.4 billion stake to Thailand's Charoen Pokphand Group.