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BOC may enter insurance sector

By Zhang Ran (chinadaily.com.cn)
Updated: 2009-03-18 13:43

Bank of China (BOC) will purchase a stake in Heng An Standard Life as it seeks to expand into the insurance industry, a source close to the lender told China Daily.

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The source declined to disclose the amount of investment and said the plan has not been submitted to the State Council for approval.

The move would likely let BOC join a batch of pilot banks investing in the country's insurers.

Local media reported earlier that China's banking regulator has chosen four banks including Industrial and Commercial Bank of China, China Construction Bank, Bank of Communications, and Bank of Beijing as pilots to invest in insurers.

Chinese banks were not allowed to deal with insurance business until the end of 2007, when the State Council, or China's Cabinet, permitted three to four lenders to invest in existing insurance companies in a pilot program. So far, no banks have been approved to make such investments.

Wu Dingfu, chairman of China Insurance Regulatory Commission (CIRC), said in an earlier press conference that his commission is working with the banking regulator on the pilot program and the plan has not been submitted to the State Council yet.

Heng An Standard Life was set up in 2003. Britain-based Standard Life and Tianjin-based TEDA Investment Holding Co Ltd each hold a 50 percent stake.