FILE PHOTO – People walk past a screen displaying the Hang Seng stock index in the Central District in Hong Kong, China, October 25, 2022. REUTERS/Lam Yik/File Photo Acquire Rights
BEIJING, Sept 10 (Reuters) – China’s financial regulator on Sunday reduced the risk weighting it gives to insurance companies’ holdings of blue-chip stocks and technology stocks, encouraging them to invest more in the country’s flagging stock market.
The National Administration of Financial Regulation (NAFR) announced on its website that the risk weight for the constituents of the CSI300 index would be reduced from 0.35 to 0.3, while the risk weight for stocks listed on the technology-focused STAR market in Shanghai quoted would be reduced from 0.45 to 0.4.
A lower risk weighting frees up more capital for insurers to invest.
The regulator also reduced the risk weight it assigns to investments in real estate investment trusts (REITs), which primarily invest money in infrastructure projects in China.
It also set a relatively low risk weight for private equity investments in China’s strategic and emerging sectors.
China has unveiled a series of measures to boost investor confidence and revive its stock market. These include halving stamp duty on stock trading and slowing the pace of initial public offerings (IPOs).
Reporting by Samuel Shen in Shanghai and Yew Lun Tian in Beijing; Edited by Christina Fincher
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