Pay close attention to short-term liquidity risks of some small and medium-sized insurance companies

Xinhua News Agency, Beijing, February 9 (Reporter Tan Moxiao) The China Insurance Regulatory Commission announced on the 9th that Chen Wenhui, Vice Chairman of the China Insurance Regulatory Commission, recently stated that 2017 may be a very difficult year for the use of insurance funds, and it is necessary to pay close attention to the short-term liquidity risks of some small and medium-sized insurance companies.

Chen Wenhui said at a special training meeting on the implementation of the spirit of the National Insurance Supervision Work Conference on the use of insurance funds that the low interest rate environment and "asset shortage" will continue for a period of time. The contradiction between the asset side and the liability side of the insurance industry is still prominent. The use of insurance funds faces interest rate loss risks and reinvestment risks. Insurance companies must put risk prevention at the top of their work.

He said that with the current accumulation of risks in the financial sector, some new situations have emerged in the use of insurance funds. Individual insurance institutions lack a correct understanding of financial laws, insurance laws and insurance fund utilization laws. They are eager for quick success and one-sided pursuit of scale and profits. Problems such as irrational placards, unfriendly investments with people acting in concert, and aggressive operations have seriously affected the long-term healthy development of the insurance industry.

He said that the use of insurance funds must adhere to the principle of soundness and prudence, and be a provider of long-term funds, not a speculator of short-term funds; be a discoverer of market value, not a manipulator of market prices; be a well-intentioned investor, not a hostile acquirer; be a risk manager of diversified and multi-level asset allocation, and not be a risk creator of concentrated investment, single investment, or aggressive investment.

Chen Wenhui said that in the future, the China Insurance Regulatory Commission will make risk prevention and strengthening supervision a top priority, resolutely deal with risk hazards, revoke unqualified investment capacity registrations, severely punish illegal institutions, hold investment responsible persons accountable, establish rules for quantitative assessment, qualitative assessment and stress testing of asset and liability management, and resolutely maintain the bottom line of preventing systemic regional risks.