China continues financial crackdown

Government intensifies efforts to rid financial sector of risks

China continues financial crackdown

Insurance News

By Gabriel Olano

The China Insurance Regulatory Commission (CIRC) has announced that it is banning mainland Chinese insurers from providing credit products to companies for financing, as well as providing insurance to businesses that are funded with loans that exceed the maximum interest rate limit.

According to the State Administration of Foreign Exchange (SAFE), the country’s financial regulators will work together to strengthen risk prevention on risky overseas investments on property, hotels, film and television.

Alongside the CIRC exerting tighter control on the industry, SAFE’s spokesperson Wang Chunying said that China’s foreign exchange supply and demand in the market remained stable in the first half of the year.

“The balance [in the foreign exchange market] in the first half was the best in three years,” Wang told The Standard.

Beijing also expects that cross-border capital flows will remain stable as the economy’s performance improves, which is a sign that the government’s endeavours to stem capital outflows are effective.

Furthermore, another official caught in the government’s anti-corruption dragnet will be prosecuted. Yao Gang, former vice chairman of the China Securities Regulatory Commission, will be prosecuted for “severe disciplinary violations.”

Yao, who was investigated in 2015, is suspected of taking bribes and “destroying the order of capital markets,” the Central Commission for Discipline Inspection said.

Related stories:
Government graft-buster likely next CIRC chief
Former chief of state-owned People's Insurance Company of China to be prosecuted for corruption
China’s insurance regulator increases scrutiny of insurers

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