China announces new rules regulating financial holding companies

The State Council, China's cabinet, on Sunday unveiled new rules to regulate market access of financial holding companies.

The new regulation requires non-financial companies or other eligible entities, which control at least two financial institutions doing business across financial sectors, to apply to and get approval from the People's Bank of China to establish financial holding companies.

The move is aimed at plugging regulatory loopholes and deepening financial reforms amid efforts to maintain market order, reduce risks and enhance support for the real economy, according to a notice released by the State Council.

The regulation, which will take effect on November 1 this year, specifies rules on a wide range of issues concerning the market access of financial holding companies, including registered capital, shareholders, actual controllers, capital replenishment and risk management.