Thursday, February 22, 2018

Chinese regulator puts cap on insurers’ overseas financing

The insurance regulator in China said that insurance companies must put a ceiling on their outstanding offshore financing that is backed by domestic guarantees.

The cap, according to the China Insurance Regulatory Commission (CIRC), will be 20% of net assets, based on reported data from the end of the previous quarter.

CIRC made the announcement in a post on its website.

Furthermore, insurance firms are also prohibited from using such services to transfer domestic assets abroad.

Those engaged in single investment projects under insurers’ special purpose arms must report their activity to the regulator in cases where the value of the deal is above US$50 million.

As China has been seeing a surge in overseas investment as of late, the Chinese government has also been taking a closer look at illegal practices in transferring assets abroad.

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Nina Klingspor, Allianz Global Corporate & Specialty

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