They might not be giants

18 September 2020 By Yawen Chen Follow @ywchen1

The central bank’s new rules to curb reckless sprawl and systemic risk are ready to roll. Designed to stop another Tomorrow-like debacle, they may force influential conglomerates such as CITIC and state-owned groups to restructure. The trick will be for Beijing to stay vigilant.

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The People's Bank of China on Sept. 13 issued new rules on what type of non-financial companies are required to register as financial holding companies, along with details on how to regulate them. The rules are set to take effect on Nov. 1, with a one-year grace period to comply.

Companies that control at least two different types of financial institutions, with typically at least 500 billion yuan ($73.9 billion) in financial assets and 5 billion yuan in registered capital, will be designated and regulated as financial holding companies pending regulatory approval.

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