HSBC Insurance has received approval from the China Insurance Regulatory Commission to form a joint-venture insurance company with a mainland firm that could begin operations as early as in the second half of next year, according to sources.
The insurance arm of HSBC Holdings will form a 50-50 venture with National Trust, a Beijing-registered trust and investment company, to establish individual insurance business, particularly life insurance, nationwide.
'The minimum capital requirement for getting a nationwide licence is about 500 million yuan; however, the actual amount involved in the initial stage still has to be decided,' a source said.
The parties have 12 months to form the venture. A spokesman for HSBC declined to comment.
Insurance premiums on the mainland rose more than 20 per cent to 371.8 billion yuan in the first six months of this year.
The new venture, to be headquartered in Shanghai, would establish its business initially in major cities such as Shanghai, Beijing, Guangzhou, Shenzhen and the coastal areas, the source said.