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Chinese Insurer to Invest More in Securities
The China Pacific Insurance Company has been recently approved by the China Insurance Regulatory Commission (CIRC) to invest 15 per cent of its assets in securities investment funds, as against the previous five per cent.
According to Monday's China Securities newspaper, China Pacific is the first insurance company approved by the regulators to raise its securities investment to 15 per cent of its assets.
China's insurance companies was first permitted to invest in securities investment funds last October, before which, the insurers could only deposit their money with banks or invest them in treasury bonds.
Limited investment tools and the central bank's consecutive interest rate cuts have brought increasing insolvency risks for Chinese insurance companies.
The CIRC had said that it would raise the ceiling for insurers' securities investment based on their asset quality and structure, risk management ability and operating performances.
In March this year, four insurance companies, i.e., the Ping An, New China Life, Taikang Life and Huatai Properties were approved to raise the ceiling from five percent to 10 percent.
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