China’s anti-corruption wacthdog is investigating the country’s top insurance regulator amid growing concern in some parts of the government over lax industry oversight, the Wall Street Journal reports.
A statement from the Communist Party’s Central Commission for Discipline Inspection did not give details on why Xiang Junbo, chairman of the China Insurance Regulatory Commission, was being probed. It said he was suspected of “serious violations” of party discipline, a phrase typically used to denote graft.
The investigation against Xiang had been rumored for some time.
It comes as Beijing contemplates how to better coordinate financial oversight between the central bank and banking, securities and insurance regulators.
The spotlight has been on China’s insurance regulator and Xiang since 2015, when domestic insurance companies began snapping up shares of listed firms across several sectors, including blue-chip names.
A big reason for their spending spree was pressure to meet returns for highly lucrative investment products they began selling to ordinary investors.
China’s insurance regulator stepped up oversight, although an earnest campaign to rein in insurers only came after the head of the China Securities Regulatory Commission drew the public’s attention to their activities.
In December, Liu Shiyu criticized what he termed as corporate raiders that were using “improperly sourced” funds to buy stakes in companies, in comments that were widely interpreted as directed against aggressive insurance firms.
Xiang himself also called for insurers to get back to the basics of providing insurance products.
Xiang, 60, took over as chairman of the commission in 2011 after serving as the head of Agricultural Bank of China.
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