China issued new rules on Sunday to regulate financial holding companies, in its latest move to prevent systematic risks to the nation's vast financial sector.
The new rules were set to stem loopholes in supervision and regulation systems, as a small number of companies expanded blindly into the financial sector without isolation mechanisms and while accumulating risks, the central bank People's Bank of China (PBOC) said in a statement.
The new regulations will require licenses for non-financial companies that do business across at least two financial sectors, and which are designated as "financial holding companies," the State Council said Sunday on its website.
The rules also set requirements in total assets that financial holding firms can manage. Companies that hold banking assets will need to have at least 500 billion yuan in total assets, and those that do not hold banking assets should have at least 100 billion yuan in assets.
In 2018, the central bank put five financial holding companies, including fintech giant Ant Financial, retail conglomerate Suning.com and state-owned China Merchants Group, in a pilot scheme to test their ability to manage risks. Jack Ma's Ant Financial, now renamed Ant Group, is seeking dual listings in Hong Kong and Shanghai.