China to allow banks invest in insurers this wk-sources
SHANGHAI, Jan 15 (Reuters) - Chinese banking and insurance regulators will sign an agreement this week to allow banks to invest in insurance firms, sources close to regulators said, in a move aimed at expanding profit streams for Chinese banks.
The sources, who were briefed on the situation, told Reuters on Tuesday that the China Banking Regulatory Commission and China Insurance Regulatory Commission would sign the deal as early as Wednesday and an official announcement would be made soon after the pact was signed.
Under the agreement, Chinese banks are allowed to invest in both existing domestic life and property insurance firms but they are not allowed to set up their own new insurance firms, the sources said.
The new policy is expected to boost the capital of China's many small- and mid-sized insurance firms which are competing with China's top three life insurers, including China Life Insurance Co. (601628.SS) (2628.HK), which jointly controls more than 50 percent share of domestic life insurance markets.
Chinese banking and insurance regulators would begin to accept formal applications from banks that want to invest in insurers soon after the agreement is signed this week, said the sources, who declined to be identified because they were not authorised to speak to the media before an official announcement. (Reporting by George Chen; Editing by Anne Marie Roantree)
