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Sanctions: China’s largest state-owned insurers assess exposure to Russia

The impact of international sanctions applied to Moscow seems to worry Beijing authorities. Two of the largest state-owned insurers were ordered to measure risk for their business in Russia.

After opposing the establishment of international sanctions against Russia, in the context of the current military aggression against Ukraine, claiming that these are ineffective measures, also assuming that economic and commercial relations with the international aggressor are to be maintained, the Chinese authorities gave instructions to at least two large state-owned insurers to review their exposure levels (business and investment portfolios) to Russia, Ukraine and, in one case, also to Belarus, Reuters reported.

The initiative by Chinese financial regulators shows how the world’s second-largest economy seeks, “behind the curtains”, to minimize the risks to which the institutions themselves were subjected, even against the Western effort to wage the war against Ukraine and isolate Russia from the rest. of the world.

The CBIRC – China Banking and Insurance Regulatory Commission is the supervisory body and is directly supervised by the central bank of the People’s Republic. The instructions addressed to the supervised are intended to assess the impact of sanctions on the business of state insurance companies and also to know the contingency plans that these companies have defined to deal with the consequences of the events.

Insurers China Life, China Pacific, and People’s Insurance Company Group of China are among the largest in the country and manage billions of dollars in assets. Official information from the Chinese representation in Russia indicates PICC P&C, also state-owned, is one of eight financial institutions operating in the Russian Federation, but the company said it has little exposure.

Another source at the international news agency said that the share of investments made by insurers in foreign countries is relatively small. But survey data for June 2020 indicated an annual increase of 38%.

Source: with agencies

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