Chinese insurers banned from demanding repayment from brokerages ahead of deadline
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[SHANGHAI] China's insurance regulator said on Thursday it has allowed insurers which lent brokerages money through stock-related businesses to renegotiate deadlines for repayment, and forbid them from demanding money back ahead of the deadline.
Some asset management arms of insurance companies launched investment products and entered into repurchase and other lending businesses with brokerages to fund margin financing.
The measures are aimed at "maintaining healthy and stable development of the capital markets, preventing irrational stock price drop, and protect the interest of investors and policy holders", the China Insurance Regulatory Commission said in a statement on its website.
In a similar move announced earlier on Thursday, the banking regulator said it would permit financial institutions to renegotiate maturity terms regarding lending using stock as collateral and allow banks to ease margin requirements for wealth management and trust product clients.
Beijing has announced a flurry of support measures in the last two weeks after Chinese stock markets slumped more than 30 per cent from their mid-June highs.
REUTERS
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