China Information

Monday, December 25, 2006

Expansion of the Scope of Investment of Overseas Insurance Fund

The scope of investment of overseas insurance fund is expected to expand. According to the Measures for the Administration of Overseas Investment of Insurance Fund (Request of Opinion) recently released by the CIRC, insurance institutions can invest in global matured capital market through purchasing foreign exchange or using self-owned foreign exchange. The capital market for investment includes: monetary market products, fixed income product, equity products, and futures derivatives within certain scope. Comparing with the Interim Measures for the Administration of Overseas Use of Insurance Fund of Foreign Exchange issued in Aug.2004, the scope of the Request of Opinion has not only expanded investment to purchasing foreign exchange with RMB in terms of the insurance fund but also had flexible provisions on the types of investment. The Request of Opinion claimed that the total volume of overseas investment of insurance fund can neither exceed 15% of overall assets by the end of last year nor exceed investment quota of foreign exchange payment approved by the CIRC and the SAFE. The detailed investment ratio is approved by the CIRC.

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