A group of central authorities including the China Securities Regulatory Commission has jointly issued an implementation plan to channel more medium- and long-term capital into China’s equity market, following review and approval by the Central Financial Commission. The package targets commercial insurers, the National Social Security Fund, basic pension funds, enterprise and occupational annuities, and public fund managers, with an emphasis on removing entry bottlenecks and shifting institutional evaluation toward assessment horizons of three years and longer. Key measures include guiding large state-owned insurers to increase their A-share holdings (including equity funds) and moving their operating performance evaluation to a long-cycle basis, with the annual return-on-equity assessment weight capped at 30% and three-to-five-year indicators set at no less than 60%. The plan also calls for steadily increasing the equity allocation of the National Social Security Fund, expanding entrusted investment by eligible basic pension funds, and clarifying long-cycle assessment mechanisms of five years or more for the National Social Security Fund and three years or more for basic pension fund operations. For enterprise and occupational annuities, the authorities plan to issue guidance on three-year-plus performance assessment, expand coverage, support eligible employers exploring member investment choice, and encourage differentiated investment by annuity managers. On the fund management side, the plan aims to increase the scale and share of equity funds through classification-based supervisory evaluation and an optimized product registration process, strengthen alignment of interests between fund managers and investors, and broaden private securities fund product types and strategies as operating rules are implemented. Market-structure measures include encouraging listed companies to step up share buybacks and implement multiple dividends within a year, promoting use of the buyback and shareholding-increase relending tool, allowing public funds, insurers, pension and annuity funds, and bank wealth management products to participate as strategic investors in listed company private placements, applying equal policy treatment across bank wealth management, insurance asset managers and public funds in IPO subscription, private placements and stake-building recognition standards, and expanding the scale of the securities-funds-insurance swap facility operations. Implementation steps flagged in the plan include accelerating the rollout of the second batch of the insurance funds long-term stock investment pilot with a subsequent expansion of participating institutions and funding size, speeding up the issuance of annuity long-cycle assessment guidance, and pushing through the operational rules for private securities investment funds.
China Securities Regulatory Commission 2025-01-22
China Securities Regulatory Commission joins agencies in issuing implementation plan to increase long-term funds’ equity investment and adopt multi-year performance assessments
The China Securities Regulatory Commission and other authorities have issued a plan to channel more medium- and long-term capital into China's equity market, approved by the Central Financial Commission. It targets commercial insurers, pension funds, and public fund managers, focusing on removing entry barriers and extending evaluation horizons to three years or more. Measures include increasing A-share holdings by state-owned insurers, enhancing equity allocations for the National Social Security Fund, and expanding investment options for pension and annuity funds.