In September, the central bank granted a third license to
state-owned China Merchants Group.
(Reporting by Ziyi Tang and Ryan Woo; Editing by Toby Chopra
and Bernadette Baum)
(Adds details, context)
BEIJING, Feb 9 (Reuters) - China's central bank on
Thursday issued rules managing financial holding companies'
affiliated transactions, to help curtail risks and ensure
financial stability, according to a statement on the regulator's
website.
The rules, which follow a draft version in August, will
promote stable and healthy operation of financial holding
companies and prevent financial risks, the People's Bank of
China said. The rules take effect on March 1.
Improper transfer of interests through financial holding
companies' transactions with related parties will not be
allowed. The firms are also barred from designing complex
structured products for affiliated transactions to hide risks
and sidestep supervision.
Financial holding firms will be required to improve the
management, reporting and disclosure mechanisms of affiliated
transactions.
China in 2020 required nonfinancial conglomerates that own
multiple units in the financial sector to register as financial
holding companies. That was part of efforts to tighten oversight
of companies that sidestepped regulatory supervision to expand
and posed systemic financial risks.
Regulators in March last year approved the first batch of
financial holding firms -- China CITIC Financial Holdings and
Beijing municipal government-owned Beijing Financial Holdings
Group.
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