Financial institutions are the latest targets of the Hengqin zone. In August and September, the Hengqin government announced schemes to attract semiconductor companies and listed companies respectively.
Following a string of high-profile scandals at major insurers in recent years that required bailouts, regulators want to ensure that the industry’s rescue fund is fit for purpose, adequately funded, and is endowed with rights befitting its role. By requiring bigger pay-ins from riskier insurers, the CBIRC can reduce the risk of moral hazard and incentivize riskier firms to get their balance sheets in order.
China has been working hard to make its RMB 138.2 trillion bond market more attractive to FIIs over the past two to three years, removing obstacles that investors have complained hinder their ability to trade and make the market less appealing. But in spite of Beijing’s efforts, FIIs have been pulling money out of the market this year amid concerns that economic growth is declining, mainly as a result of the government’s zero-COVID policy.
Cai and Qiu essentially reiterated the message delivered by China Securities Regulatory Commission Vice Chairman Fang Xinghai at the China International Import Expo on November 5. That message: central policy will continue to…
Fang is right that financial opening has ticked up in recent years – and regulators do indeed want it to continue. However, the nature of that opening has been gradually shifting.
Corporate groups are large, complex organizations. The opacity of both their ownership structures and internal oversight procedures has made their finance companies prime breeding grounds for corruption and risky practices, including irregular lending outside of the group. These rules are lengthy, comprehensive, and specific – the CBIRC means business with this document, which seeks to standardize, improve transparency, and improve regulation of internal financial services within large organizations.
Confirmation is information – there may be nothing new here, but that means Beijing is pleased with where things are headed vis-à-vis the rollout. It’s also clear – and good news – that the various regulators involved in this massive project are coordinated and on the same page – never a given in Beijing’s financial regulatory apparatus.
Sun Life/Manulife; BlackRock; Prudential Financial; BNP Paribas; Goldman Sachs
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Lee’s speech highlights a reality that has become increasingly clear in recent months, namely, that Hong Kong policymakers increasingly see integration with mainland policy goals as…