UPDATE 1-China Investment aims for 5 pct yearly return-exec

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By George Chen

BEVERLY HILLS, Calif., April 17 (Reuters) - Chinese sovereign wealth fund China Investment Corp Ltd, launched last year, aims for about a 5 percent annual return on investment in its early years, Chief Risk Officer Jesse Wang said on Thursday.

Speaking on the sidelines of a Committee of 100 conference, Wang said U.S. banks, insurance companies and other Western companies had sought investment from the $200 billion fund controlled by China's government.

"Many Western companies approached us after the credit crisis, including some U.S. banks and insurers, though I cannot give you their names," Wang told Reuters in an interview.

"Some of them are short of capital due mainly to their losses from the U.S. subprime problems, so they hope CIC can invest in them to boost their capital bases," he said.

China Investment Corp last year bought a $5 billion stake in Morgan Stanley (MS.N: Quote, Profile, Research, Stock Buzz).

"If we can get about 5 percent every year and remain at such a rate for a few years, that will be very ideal to us," Wang said, when asked for comments on its return on investment target.

Despite its size, the fund itself is finding it difficult to hire staff such as asset managers because of low compensation, Wang said.

China has more than one sovereign wealth fund, and Wang said his Beijing-based fund is separate from a Hong Kong-based fund owned by China's foreign exchange regulator, which recently bought shares of BP Plc (BP.L: Quote, Profile, Research, Stock Buzz) and Total (TOTF.PA: Quote, Profile, Research, Stock Buzz). (Editing by Gary Hill and Braden Reddall)