China's National Financial Regulatory Administration issues 16-point guidance to tighten oversight and refocus financial asset management companies on risk disposal

China's National Financial Regulatory Administration issued Guiding Opinions on promoting the high-quality development of financial asset management companies and improving the effectiveness of supervision, setting out 16 measures covering governance, core business focus, risk prevention and supervisory practices. The guidance calls for stronger Party leadership and Party-building, improvements to corporate governance arrangements, and the establishment of incentive and restraint mechanisms. It directs financial asset management companies to concentrate on their distinctive functions by strengthening and upgrading non-performing asset acquisition and disposal, including supporting risk resolution in small and medium-sized financial institutions and the real estate sector. Risk expectations include enhancing risk management and internal controls, accelerating disposal of existing risk assets, strictly controlling incremental business risks, strengthening asset-liability and liquidity management, and advancing operational streamlining. On supervision, it aims to further完善 the regulatory制度体系, intensify supervision in key areas, strengthen investigations and penalties for illegal and non-compliant activities, build supervisory capacity, and improve coordination across different oversight channels.