Anbang Insurance Group introduced the China Insurance Security Fund for Capital Injection and Initiated Strategic Investors Selection Process
After investigation and verification, the China Banking and Insurance Regulatory Commission (“CBIRC”) has discovered that some previous shareholders of Anbang Insurance Group Co., Ltd. (“Anbang Insurance Group”, or the “Company”) did not use their own funds and provided false documentation in the incorporation preparation application and capital increase applications of Anbang Insurance Group. In order to further strengthen insurance supervision, effectively prevent financial risks, and curtail breaches of laws and regulations related to insurance companies’ equities, the CBIRC has annulled the administrative licenses of those shareholders and relevant registered capital changes of Anbang Insurance Group in accordance with the “Administrative License Law” and other relevant laws and regulations.
In order to maintain a good solvency ratio, keep stable operations of the Company, and effectively protect the interests of policyholders, Anbang Insurance Group has introduced the China Insurance Security Fund (“CISF”) for capital injection which has been approved by the CBIRC. Such capital injection is to make up the gap resulting from the annulment of administrative licenses granted to those previous shareholders. After such capital injection, the registered capital of Anbang Insurance Group remains at RMB 61.9 billion.
It is a commonly used risk disposal measure in the world to introduce industry bailout fund to participate in the risk disposal process. The CISF, as a non-governmental industrial bailout fund, mainly serves the purpose of bailing out policyholders and policy transferee companies, or resolving risks of the insurance industry. It is a temporary risk disposal measure to improve corporate governance and increase capital strength by introducing CISF as an interim shareholderfor a limited time period. Concurrently, Anbang Insurance Group has initiated the process of introducing strategic shareholders. Anbang Insurance Group is targeting to introduce quality and qualified private capital as strategic shareholders as soon as possible, to realise the orderly and safety exit of the CISF and to maintain Anbang Insurance Group as a private owned company.