The four departments intend to prohibit bancassurance institutions from conducting derivative transactions with individual customers through the counter
Yesterday, the official website of the central bank issued the "Guiding Opinions on Promoting the Standardized Development of Derivatives Business (Draft for Comment)" (hereinafter referred to as the "Guiding Opinions").
It is understood that in order to standardize the derivatives business, promote the healthy development of the domestic derivatives market, protect the legitimate rights and interests of all parties, and prevent systemic risks, the central bank, in conjunction with the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, and the foreign exchange bureau, jointly drafted the document and is now seeking public opinions. .
The "Guiding Opinions" unify the definition and classification of derivatives.
According to the "Guiding Opinions", derivatives are a financial agreement whose value depends on changes in the value of underlying assets such as interest rates, exchange rates, commodities, equity, credit, and precious metals.
The "Guiding Opinions" stipulate that financial institutions should abide by the relevant management regulations of the China Banking and Insurance Regulatory Commission and the China Securities Regulatory Commission when conducting derivatives business, and complete necessary access procedures.
Financial institutions handling RMB-to-foreign exchange derivatives business shall also abide by the relevant regulations of the foreign exchange bureau.
Non-financial institutions shall not issue products with the characteristics of derivatives business to the public or provide derivatives trading services.
Financial institutions shall not conduct derivatives business in disguised form in violation of the provisions of this opinion.
Financial institutions that provide some products that meet the basic characteristics of derivatives shall report to the relevant financial management department.
The "Guiding Opinions" focus on counter-to-customer derivatives business and strengthen investor protection.
It is clarified that when financial institutions conduct counter-to-customer derivatives business, they should only cater to qualified investors, and further regulate relevant requirements for suitability assessment, risk disclosure, sales management, internal management, etc., and encourage them to follow the rules of organized markets. Transaction settlement, etc. to prevent risks.
Among them, special attention is paid to the protection of individual customers. Financial institutions are required to conduct derivatives business mainly for non-individual investors. Bancassurance institutions are prohibited from directly conducting derivatives transactions with individual customers through counters. Other financial institutions must make changes to provide services to individual customers. In order to prudently participate in the requirements, the relevant evaluation and sales requirements are also stricter.
Prevent extreme risks
Financial institutions must establish emergency plans
The "Guiding Opinions" require financial institutions to strengthen internal control management and consolidate the micro-foundation for the standardized development of derivatives business.
The first is to clarify that financial institutions should follow the principles of compliance, matching, prudence and transparency when carrying out derivatives business, and ensure that their derivatives business is compatible with their own business development and management capabilities.
The second is to improve corporate governance and establish and improve the three lines of defense for business, risk control and compliance, and auditing.
The third is to improve risk management, to ensure that derivatives business is included in comprehensive risk management such as market, credit, operation and liquidity, and to establish emergency plans to prevent extreme risks.
The "Guiding Opinions" are applicable to domestic and overseas licensed legal person financial institutions established with the approval of the China Banking and Insurance Regulatory Commission and the China Securities Regulatory Commission, including domestic and overseas branches of bancassurance institutions.
The "Guiding Opinions" stipulate that bancassurance institutions shall not provide enterprises with transaction services for non-hedging purposes.
Financial institutions are required to perform necessary reporting or approval procedures for conducting cross-border related derivatives business, and strictly control risks. In principle, bancassurance institutions are not allowed to conduct cross-border non-hedging transactions of over-the-counter derivatives.
This group of articles / our reporter Cheng Jie