Govt tightens oversight of insurers' overseas financing

China has tightened its regulation of the country's insurers' overseas financing activities, aiming to reduce their capital leverage and prevent the illegal transfer of onshore assets to overseas markets.

China's insurance and foreign exchange regulators issued a notice this week requiring that the value of insurers' overseas financing guaranteed by their onshore assets must not exceed 20 percent of their total net assets at the end of the previous quarter.

The regulators also banned insurers from using onshore assets backed by debts as collateral for their overseas borrowing and required that insurers must control at least 95 percent of the stake in their overseas financing entities.