Since last month when the Chinese authorities laid out a clearer timetable for opening the financial sector to more foreign investment by the end of this year, Hong Kong's FWD Group has become the fourth overseas insurance company to push further into the Chinese market.
FWD Group, the insurance business of Hong Kong tycoon Richard Li Tzar Ka’s Pacific Century Group, has applied to set up a joint venture in Shanghai, the Shanghai Financial Service Office said in a statement.
The Hong Kong insurer could take a 51% stake in the venture, reports Shanghai Securities News. FWD did not give details of the venture’s structure, saying only that it sees “a significant opportunity in China to meet the financial and insurance needs of mainland customers”.
FWD's move follows that of Willis Insurance Brokers which has become the first fully licensed foreign broker to transact all insurance business in China. In addition, ICBC-AXA, a life insurance joint venture between Industrial and Commercial Bank of China and French insurer AXA, has been given the nod to set up an insurance assets management company in Shanghai. German insurance giant Allianz will set up a wholly owned holding company in Shanghai to oversee all its life and non-life business in mainland China.
Last Sunday, Shanghai announced new measures to open wider its finance businesses, in a bid to develop itself into an international finance centre. The scope of Shanghai-based foreign-funded insurance companies will be expanded. Foreign banks will be encouraged to set up both branches and subsidiaries in Shanghai. The city will also support the establishment of securities, fund management and futures companies with foreign investors as majority owners.