SFC Reiterates Eight Bottom Line Of Asset Management Business

Zhang Yujun, assistant chairman of the China Securities Regulatory Commission, said 12 days that the scope of investment in asset management business has been greatly broadened, and the business characteristics and risk forms have changed accordingly. We must fully understand the importance of preventing and controlling the risk of asset management business and firmly guard the eight bottom line.

Zhang Yujun made the above remarks at a symposium on asset management business involving securities companies, fund management companies and their subsidiaries.

Zhang Yujun said that in recent years, the asset management business of securities companies, fund management companies and their subsidiaries has developed rapidly, and has become an important business.

At present, asset management business risk violations continue to occur, whether effective prevention and control of asset management business risk is related to the success or failure of the industry's innovation and development.

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We must fully understand the importance of preventing and controlling the risk of asset management business, and firmly guard the eight bottom line: that is, there should be no acts of impair the interests of customers, such as non fair pactions, interest conveyance, rat storage, etc., and we must not violate the promise of capital preservation and profit protection; we must properly publicize and sell products, mislead fraudulent customers; we must not carry out the business of capital pools; we should not use commercial products to carry out commercial bribery; the leverage ratio of information management products should not exceed ten times; we must not invest in industries that prohibit investment in high pollution, high energy consumption and other countries; and we must not encourage business personnel and management teams to implement timely incentives.

At present, China's asset management business should vigorously enhance the professional financial management capacity, make business development and compliance control equally, and promote the healthy development of asset management business.

According to statistics, as at the end of July 2014, the scale of information management of securities companies, fund management companies and their subsidiaries reached 10 trillion and 200 billion yuan, of which the scale of securities companies' information management was 7 trillion yuan.

The scale of the management company's account is 922 billion 400 million yuan, and the scale of the fund subsidiary is 2 trillion and 290 billion yuan.