New rules to curb cross-sector risks

The proposed national regulation on the operation of financial holding groups is expected to reduce cross-sector risk contagion and help trim the excess flab of highly-leveraged financial giants, according to local media reports.

A set of new rules are currently awaiting approval from the authorities and fresh discussions are needed before the final approval, said media reports in Yicai Media Group and 21st Century New Group, citing sources close to the regulators.

Financial holding groups' capital quality and their ability to absorb potential market shocks will be reassessed by the upcoming new rules, before they get new licenses from the country's top financial regulator, according to experts familiar with the matter. The groups conduct a wide range of financial business including banking, securities and insurance.