China raises limit for investments in stocks and mutual funds
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The China Insurance Regulatory Commission (CIRC) issued Wednesday, a circular in which it said to raise to 25 percent the investment ratio of insurers in the capital market of stocks and mutual funds. The previous percentage on investments was of 20 percent.
More detailed information contained in the notice showed that now, insurance firms will be able to invest 20 percent of its total assets in the previous quarter in stocks and stock funds, while the total amount to be invested in equities, equity funds, bond funds and currency funds will have to be below the margin of the 25 percent of the last quarter's assests.
It (the notice) also specified that investments in a single company's stocks cannot exceed 10 percent of the insurer's general capital, and the investment in a single securities fund should not exceed 3 percent of the insurer's last quarter's assets. In addition, the investment in a single close-ended fund can not exceed 10 percent of the issuing amount of the fund.
Overseas investments by insurance companies should be no more than 15 percent of their total assets by the end of the previous quarter.
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