Regulator gives nudge to insurance asset management companies to engage in ABS and REITS

China’s securities regulator has issued guidelines that encourage insurance asset management companies to engage in asset-backed securities (ABS) and real estate investment trust (REIT) businesses.

The “Guidelines for Asset Securitisation Business of Insurance Asset Management Companies” was formulated to support high-quality insurance asset management companies with sound corporate governance, internal control management, and rich asset management experience, to participate in ABS and Real Estate REITs. This will promote the high-quality development of the multi-level REITs market.

Qualified insurance asset management companies can simultaneously submit application documents to the Shanghai and Shenzhen stock exchanges. The stock exchanges will carry out self-regulatory supervision of the ABS and REITs businesses of insurance asset management companies, and conduct inspections according to regulatory needs.