“SET UP CREDIT RISK SYSTEM” CIRC TELLS INSURERS

Insurers could be required by the China Insurance Regulatory Commission (CIRC) to set up credit risk assessment systems for their bond investments, reports Xinhua . The regulator said that credit defaults were “the most grave risks” faced by insurers, and that the introduction of a risk assessment system would strengthen security of assets. The CIRC said that the credit rating system should be two-tiered, with the bond issuer and the bond itself being assessed. Insurers would establish their own rating models, customised to their own appetite and need for risk, the CIRC said.