BEIJING, July 3 (Xinhua) -- China Banking and Insurance Regulatory Commission (CBIRC), the sector watchdog, issued rules on allowing insurers to participate in T-bond futures trading to support the latter's risk management, reported Economic Daily.
The rules contained 17 articles, among which insurers are required to take part in trading T-bond futures not for speculation, but for risk hedging only.
In trading T-bond futures, insurers should participate via funds of their asset portfolios and open independent trading accounts to realize independent management of related accounts, assets, transactions and accounting in an effort to reduce risks.
CBIRC also set in the rules restriction on the T-bond futures contracts positions held by insurers to rein in leveraging and strengthen liquidity risk management.
According to a CBIRC official, debut of the T-bond futures trading rules for insurers further enriched their risk hedging vehicles, good for them to enhance assets and liabilities management for stronger risk guarding.
The Chinese banking and insurance regulator amended at the same time rules on insurers participating in trading financial derivatives and stock index futures, which highlighted risk management and provided that insurer funds should take part in related trading for hedging risks only too. (Edited by Duan Jing with Xinhua Silk Road, duanjing@xinhua.org)
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