China Banking and Insurance Regulatory Commission, China issued the Notice on Insurance Funds Investing in Financial Products.

　　In order to further optimize the allocation structure of insurance assets, improve the quality and efficiency of insurance funds in serving the real economy, and prevent investment risks, China Banking and Insurance Regulatory Commission recently revised and issued the Notice on Insurance Funds Investing in Related Financial Products (hereinafter referred to as the Notice).

　　The "Notice" consists of seventeen articles, and the main amendments include:

　　First, broaden the scope of investable financial products. Incorporate wealth management products of wealth management companies, single asset management plans and debt-to-equity swap investment plans into the scope of investable financial products, and further improve the allocation structure of insurance assets.

　　The second is to implement the main responsibility. It is clear that an insurance asset management company should undertake active management responsibilities such as due diligence, investment decision-making and post-investment management when entrusted to invest in financial products. Cancel the external credit rating requirements for insurance funds to invest in credit asset-backed securities, asset-backed special plans and other products, and guide institutions to implement the main responsibility of risk management.

　　The third is to strengthen the penetration of regulatory requirements. For some financial products, insurance institutions are required to have the corresponding investment management capabilities according to the nature of the underlying assets of the products, and to manage them according to the types of the underlying assets, so as to truly reflect the risks of investment assets.

　　The fourth is to standardize the behavior of investing in a single asset management product. For insurance companies to invest in a single asset management plan and private wealth management products issued to a single investor, it is required to improve the selection criteria and procedures for investment managers, carefully formulate investment guidelines, and maintain asset safety.

　　The fifth is to improve the post-investment management requirements. Insurance institutions are required to clarify the post-investment management responsibilities of investment financial products, equip with professional post-investment management personnel, regularly track the investment situation, and take effective measures to control related risks.

　　The promulgation and implementation of the Notice is conducive to better meeting the needs of diversified allocation of insurance assets and providing long-term stable financial support for the capital market. In the next step, China Banking and Insurance Regulatory Commission will continue to improve the regulatory policy system, intensify market-oriented reforms, guide insurance funds to give full play to their long-term investment advantages, and serve high-quality economic development.

　　The person in charge of the relevant departments in China Banking and Insurance Regulatory Commission, China answered the reporter’s question on the Notice on Insurance Funds Investing in Financial Products.

　　1. What is the revision background of the Notice?

　　Financial products are an important part of insurance asset allocation. In recent years, according to the principle of system first, the scope and variety of investable financial products have been gradually broadened in the field of insurance fund application, especially after the release and implementation of the original investment financial products policy in 2012, the scale of insurance fund investment financial products has been increasing. By the end of December, 2021, the scale of financial products invested by insurance funds was 1.72 trillion yuan, accounting for 7.39% of the balance of funds used. The varieties covered commercial bank wealth management products, collective fund trusts, credit asset-backed securities, asset-backed special plans, etc., and the allocation structure of insurance assets was further improved.

　　With the rapid development of China’s financial market, financial products such as wealth management products of wealth management companies are constantly emerging, and their risk-return characteristics meet the needs of insurance fund allocation, and the industry has a strong willingness to allocate. At the same time, with the promulgation and implementation of the "Notice on Optimizing the Supervision of Insurance Institutions’ Investment Management Capability" and other policies, the regulatory requirements for financial product investment concentration ratio and investment management capability have been adjusted, which need to be clarified from the system. In addition, the regulatory requirements of the original policy in financial product decision-making process and post-investment management need to be further strengthened. Therefore, it is necessary to revise the Notice in light of the new situation and situation.

　　Second, what ideas have been followed in the revision of the Notice?

　　When I revised the Notice, I followed the following ideas: First, I adhered to the combination of problem orientation and goal orientation. Focus on the asset allocation pressure and problems faced by the industry, and according to the development of the financial market, bring financial products with risk-return characteristics that meet the needs of insurance funds into the investment scope to meet the needs of diversified investment and improve the quality and efficiency of serving the real economy.

　　The second is to adhere to the combination of implementing the main responsibility and improving the regulatory requirements. On the one hand, we will compact the main responsibility of institutions, guide and strengthen investment capacity building, and prudently and steadily carry out investment. On the other hand, improve the regulatory requirements for counterparties, basic assets, related transactions and other aspects to prevent investment risks.

　　Third, adhere to the combination of system innovation and overall coordination. Pay attention to strengthening the top-level design of system construction, strengthen the coordination with policies such as entrusted investment management, insurance asset management products, pooled fund trust and investment supervision ratio, and improve the quality and efficiency of supervision.

　　3. What are the scope of financial products to which the Notice applies?

　　The Notice regulates the investment of insurance funds in financial products issued by non-insurance financial institutions, and the products involved include asset management products and asset securitization products issued by commercial banks or wealth management companies, trust companies, financial asset investment companies, securities companies, securities asset management companies, securities investment fund management companies and other financial institutions according to law.

　　Compared with before the revision, the Notice deleted the infrastructure investment plan, real estate investment plan, asset support plan and their related requirements issued by the insurance fund investment insurance asset management company. The main consideration is that in recent years, the regulatory authorities have successively issued policies such as Interim Measures for the Management of Insurance Asset Management Products, Notice on Printing and Distributing Three Detailed Rules for the Implementation of Combined Insurance Asset Management Products, and Interim Measures for the Business Management of Asset Support Plans, which further improved the management and operation regulations of related products. At the same time, according to the regulatory requirements, insurance asset management companies should have corresponding product management capabilities when issuing products. Therefore, for the products issued by insurance asset management companies, insurance institutions can make investments if they meet the requirements of investor qualifications in product management regulations, which is conducive to rationalizing the supervision mechanism of insurance funds investing in insurance asset management products and other financial products.

　　4. What are the main amendments to the Notice?

　　There are 17 articles in the revised Notice, five articles more than the original policy, thirteen articles revised and seven articles deleted. The main revisions include:

　　V. How does the Notice connect with the entrusted investment management business of insurance funds?

　　The Interim Measures for the Administration of Entrusted Investment of Insurance Funds issued in 2012 stipulates that qualified securities companies and fund management companies can be entrusted with insurance funds to carry out related asset management business. After the new asset management regulations and the regulatory rules of private equity management business of securities and futures institutions were issued, securities companies and fund management companies started private equity management business by setting up private equity management plans. In order to adapt to the development of the market situation, the Notice added a single asset management plan to the scope of investable financial products, and simultaneously deleted the relevant requirements of securities companies and fund management companies as investment managers in the revised Measures for the Administration of Entrusted Investment of Insurance Funds.

　　The Notice stipulates the conditions that a securities asset management company should have to manage insurance funds. In practice, some securities companies have newly established securities asset management companies to carry out asset management business. In order to promote the smooth transition of related businesses and increase support for the capital market, the qualification period and management scale of asset management subsidiaries of securities companies that have been established with the approval of the State Council securities regulatory authorities and have not exhibited for three years can be calculated continuously with the parent company of the securities company; Due to mergers and acquisitions, risk disposal and other reasons, if the newly established company undertakes the qualification of private asset management business of the original securities company, the qualification period and management scale of asset management business can be calculated continuously with the original company.