China's insurance companies are soon allowed to invest in the domestic
real estate sector, the China Insurance Regulatory Commission said in a
statement. Earlier this year, banks were given the green light to
invest in insurers.
The draft of the revised insurance law allows insurance companies to invest in "bonds, stocks, funds and real estate," Wu Dingfu, Chairman of the China Insurance Regulatory Commission, was quoted by state media. Currently, insurers have to set up a separate investment arm to channel money in some on these markets. Ping An Insurance has poured RMB4 bn in the property market last year through its investment firm Ping An Trust & Investment.
As reported in June, several Chinese banks have been approved to invest in the insurance market and set up joint ventures with insurers. As China becomes more lenient in its policies to keep banking and insurance markets separate, the financial industries become more intertwined. A similar pattern was seen in South Korea, which, after holding the 1988 Summer Olympics, was opening up its financial markets, eventually leading to the breakup of financial conglomerates in the 1997 Asian crisis.
Last update : 27-08-2008
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