CIRC LIFTS CEILING FOR OVERSEAS INVESTMENT

The China Insurance Regulatory Commission (CIRC) has raised the limits for investment abroad by Chinese insurers to 15% of their assets. The move, announced yesterday, is effective immediately. The previous cap had been 5%. Insurers will also be allowed to invest in a wider range of foreign securities. The CIRC said that the relaxation in the rules would “give insurers flexibility in allocating their assets, improve their performance and ward off risks of the yuan’s appreciation”. The move brings Chinese insurers more into line with locally based commercial banks, fund managers and securities companies, which are already allowed to invest in global bonds and equities. Hong Kong was expected to be the primary destination of the new funds. Chinese insurers currently have assets of 2.5tn yuan ($330bn), but this is growing at a rate of 25% to 30% a year.