The Central Bank and the Banking Insurance Regulatory Commission clarify the relevant regulations of the insurance company without a fixed period of capital and bonds

The People's Bank of China issued an announcement on August 12 stating that recently, the People's Bank of China and the China Banking Regulatory Commission jointly issued the "Notice on the issuance of non -fixed -term capital bonds issued by insurance companies" to clarify the core factors of capital bonds without fixed periods of capital bonds and issuance management of issuance of capital bonds. The provisions are implemented from September 9, 2022.

Screenshot of the People's Bank of China

The notice mentioned that the non -fixed period of capital bonds issued by the insurance company shall contain a record of minus or re -transfer. When the trigger incident occurs, the non -fixed period of capital bonds shall implement the reduction or stock transfer. The trigger incidents of insurance companies' records and conversion include continuous operating trigger events and unable to survive trigger events. Continuous operation triggering incidents refer to the core solvency adequacy ratio of insurance companies less than 30%. The incident of unable to survive means that the insurance company will not survive if the Banking Regulatory Commission believes that if it is not a minus or transfer; or the relevant departments will determine that if the public sector is not injected or provided with the same validity, the insurance company will not be able to survive.

The People's Bank of China stated that promoting insurance companies to issue non -fixed -term capital bonds is an important measure to further expand the capital supplementary channels of insurance companies and improve the sufficient level of funding for insurance companies, which will help enhance the ability of insurance companies to prevent and resolve and serve real economy. It is conducive to further enriching financial market products and optimizing financial architecture.

In the next step, the People's Bank of China and the China Banking Regulatory Commission will organize the issuance of insurance companies without fixed period of capital bonds, continue to strengthen the requirements of information disclosure, effectively safeguard investors' rights, and continue to strengthen the supervision and management of financing behaviors of insurance companies, improve insurance companies The ability to prevent financial risks and serve the real economy. (Reporter Zhang Qianqian)

[Editor in charge: Liu Yang]

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