Economic review

Insurance firms told to cap offshore financing

2018-02-13 10:19:00 (Beijing Time)         Global Times/Agencies

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China's insurance regulator said on Monday that insurance firms must cap their outstanding offshore financing that is backed by domestic guarantees at 20 percent of net assets as of the end of the previous quarter.

The notice was posted on the website of the China Insurance Regulatory Commission.

Insurers are also banned from deliberately using such services to transfer domestic assets abroad or to get foreign exchange.

Single investment projects under insurers' special purpose arms must report their activity to the regulator if the value of the deal is above $50 million.

Illegally transferring assets abroad has drawn the attention of the Chinese government, as the country's overseas investment has been rising.

More than $671 billion worth of projects and M&A deals were announced in China in 2017, according to data released by consulting firm PwC in January.

The figure declined 11 percent year-on-year from 2016, a record year for overseas investment.