Insurance corps' subordinated debt issuance agreed

Insurance groups or holdings companies of insures in China may issue their subordinated debts to boost capital of insurers, according to a recent circular by China Insurance Regulatory Commission, Shanghai Securities News reported on Wednesday.

Regulators have been allowing insurance companies to issue subordinated debts since 2004; A circular released in 2011 banned the issuance of subordinated debts of insurance groups.

Analysts said the moves have shown that regulators have sensed the difficulties for insurers to raise funds.

The new policy on insurers' issuance of subordinated debt is a move to ease regulations on capital management of insurers amid the trend of mixed operations in the financial services sector, analysts said.

The recovering A-share market also helps insurers ease the tight pressure of raising funds, and the yield of insurers investments have helped enhance some insurers' solvency.

A source with a Beijing-based insurer said over the next few years the company's investments will be focused on fixed income products and reducing its reliance on the stock market to lower volatility to investment yield.