CBIRC published final measures for the supervision and administration of financial management business of commercial banks. The publication of these final measures followed a consultation, the comment period for which ended on August 19, 2018. These measures become effective from the date of promulgation—that is, September 26, 2018.
These measures are consistent with the regulations on asset management, which were issued on April 27, 2018, and are positioned to regulate non-guaranteed wealth management products of banks. The measures focus on the following key factors:
- Strictly distinguishing between public and private wealth management products
- Strengthening the appropriate management of investors
- Standardizing product operations and implementing net worth management
- Standardizing the operation of fund pools to prevent “shadow banking” risks
- Removing channels and strengthening penetration management
- Limiting and controlling concentration risk
- Strengthening liquidity risk management and control and controlling leverage level
- Strengthening management of financial investment cooperation institutions, strengthening information disclosure, and protecting the legitimate rights and interests of investors
- Implementing centralized product registration and strengthen the management of financial products’ compliance
The transition period requirements of the measures are consistent with those of the “New Regulations for Asset Management” and the transition period runs from the implementation of the measures to December 31, 2020. During the transition period, the newly issued wealth management products of commercial banks shall comply with the provisions of these measures; for stock wealth management products, commercial banks may issue unexpired assets invested by old products in connection with stock wealth management products, but shall strictly control the overall scale of the stock products. After the end of the transition period, commercial bank wealth management products shall be fully regulated and managed in accordance with these measures and the “Guidance Opinions,” except for cases where the factor company has not been established and cannot meet the requirements for independent third-party custody; commercial banks may not re-issue or remain inconsistent with the guidance.
Related Links (in Chinese)
Effective Date: September 26, 2018
Keywords: Asia Pacific, China, Banking, Wealth Management Products, Asset Management, CBIRC
BIS published the September issue of the Quarterly Review, which contains special features that analyze the rapid rise in equity funding for financial technology firms, the effectiveness of policy measures in response to pandemic, and the evolution of international banking.
The Basel Committee for Banking Supervision (BCBS) met in September 2021 and reviewed climate-related financial risks, discussed impact of digitalization, and welcomed efforts by the International Financial Reporting Standards (IFRS) Foundation to develop a common set of sustainability reporting standards
The Office of the Comptroller of the Currency (OCC) issued a Cease and Desist Order against MUFG Union Bank for deficiencies in technology and operational risk governance.
The European Commission (EC) published the Delegated Regulation 2021/1527 with regard to the regulatory technical standards for the contractual recognition of write down and conversion powers.
In a response to the questions posed by a member of the European Parliament, the President Christine Lagarde highlighted the commitment of the European Central Bank (ECB) to an ambitious climate-related action plan along with a roadmap, which was published in July 2021.
The Single Resolution Board (SRB) published a Communication on the application of regulatory technical standard provisions on prior permission for reducing eligible liabilities instruments as of January 01, 2022.
The Australian Prudential Regulation Authority (APRA) published a new set of frequently asked questions (FAQs) to provide guidance to authorized deposit-taking institutions on the interpretation of APS 120, the prudential standard on securitization.
The French Prudential Control and Resolution Authority (ACPR) published the corrective version of the RUBA taxonomy Version 1.0.1, which will come into force from the decree of January 31, 2022.
The European Commission (EC) announced that Nordea Bank has signed a guarantee agreement with the European Investment Bank (EIB) Group to support the sustainable transformation of businesses in the Nordics.
The Australian Prudential Regulation Authority (APRA) published a new set of frequently asked questions (FAQs) to clarify the regulatory capital treatment of investments in the overseas deposit-taking and insurance subsidiaries.