China officially issued a document to regulate the related transactions of banking and insurance institutions and strictly prevent the risk of benefit transfer
China News Agency, Beijing, January 14 (Reporter Wang Enbo) The China Banking and Insurance Regulatory Commission announced on the 14th the "Administrative Measures for Related Transactions of Banking and Insurance Institutions".
The official said that the move is aimed at further strengthening the supervision of related transactions, regulating the related transactions of banking and insurance institutions, and preventing the risk of benefit transmission.
The person in charge of the relevant department of the China Banking and Insurance Regulatory Commission said that in recent years, with the rapid development of China's banking and insurance industry, the risk exposure caused by related transactions of banking and insurance institutions has continued to emerge. In order to make up for the shortcomings of the system, it is necessary to further revise and improve the relevant regulatory provisions on related party transactions.
The "Measures" absorb and integrate the advantages of the two aspects of the banking and insurance industry, not only unify the management rules of related party transactions, but also take into account the characteristics of different types of institutions, and strive to achieve differentiated supervision based on the consistency of regulatory standards.
This document emphasizes that banking and insurance institutions should maintain the independence of the company's operations, improve market competitiveness, control the number and scale of related party transactions, focus on preventing risks of transferring benefits to shareholders and their related parties, and avoid complex arrangements such as multi-level nesting.
For violations such as transferring benefits to related parties through complex transaction structures or through channel business, evading supervision, etc., the "Measures" set prohibitive provisions, requiring institutions to optimize the identification of related parties and related transactions in accordance with the principles of substance over form and penetrating supervision. , and strengthen the management of related-party transactions in key areas such as off-balance sheet, asset management, and inter-bank transactions.
In terms of differentiated supervision, the "Measures" clarifies that the supervisory authority can set or adjust the supervision ratio of related party transactions applicable to bancassurance institutions according to the corporate governance status of the banking and insurance institutions, the risk status of related party transactions, and the characteristics of the type of the institution. On the premise, strengthen the pertinence and effectiveness of supervision.
At the same time, the China Banking and Insurance Regulatory Commission also emphasized strengthening the supervision of key areas, setting proportional limits for high-risk related transactions related to funds such as bank credit, insurance fund utilization, trust fund investment, etc. The index dropped by 40%, and efforts were made to prevent the chaos of providing financing to major shareholders.
It is reported that the "Measures" will be implemented from March 1, 2022, and the official will issue an implementation notice in the near future to clarify the transition period arrangements.
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