Insurance companies may buy exchange-traded corporate bonds that are unsecured, as well as non-financial company debt and unsecured convertible debt issued by commercial banks, the China Insurance Regulatory Commission said in a statement dated May 7 and posted to its website yesterday.
China has encouraged companies to raise more funds by selling stocks and bonds as it seek to wean them from a dependence on loans from state-owned banks and increase the transparency of their finances. China Securities Regulatory Commission Chairman Guo Shuqing said in a March interview with the People’s Daily newspaper that international experience showed over reliance on credit can lead to systemic risk.
Insurance companies gained in Shanghai trading, with China Life Insurance Co. rising 0.96 percent, Ping An Insurance (Group) Co. climbing 3.4 percent and China Pacific Insurance (Group) Co. rising 1.3 percent. China’s benchmark Shanghai Composite Index fell 0.25 percent.
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