Allianz wins approval for China’s first wholly-owned foreign insurance holding company – four years earlier than promised by Beijing
- CBIRC announcement on Sunday comes after Beijing initially announced a five-year wait for removal of cap on foreign ownership in November last year
- Foreign insurers face uphill battle, must compete with domestic heavyweights
Beijing has given German insurer Allianz the go-ahead to set up a wholly-owned insurance holding company in Shanghai next year – four years earlier than promised.
The approval, which points to an acceleration in the opening up of China’s banking and insurance sectors, was posted on the website of the China Banking and Insurance Regulatory Commission (CBIRC) on Sunday.
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“This year, the CBIRC has followed Beijing in expanding ‘opening’ policies to foreign banks and insurance companies, and we have approved a number of overseas companies’ applications,” the commission said in its announcement. It added that Allianz was the first foreign insurance company to get approval for setting up a wholly-owned holding company.
Beijing said in November last year that a 49 per cent cap on foreign ownership at securities firms, futures companies and fund houses would increase to 51 per cent before being scrapped in three years, while for insurance companies the cap would rise to 51 per cent in three years from 50 per cent, and would be removed in five years.
“The approval for Allianz’s wholly-owned insurance holding company in China came faster than the market expected, as the regulator last year indicated it would only remove the cap on foreign company ownership in mainland China after five years,” said Chan Kin-por, a Hong Kong lawmaker who represents the insurance sector. “This is good news for international players who want to tap the world’s fastest-growing insurance market.”
The company said it would set up Allianz (China) Insurance Holding Company in Shanghai next year. “Allianz is proud to be the first foreign insurer to commence the establishment of a holding company in China – a significant milestone for us to expand our presence in this strategic market,” Oliver Bate, the chairman and chief executive of Allianz Group, said in a statement.
This is good news for international players who want to tap the world’s fastest-growing insurance market