Home » For the first time, a wealth management company was punished by the supervision for the investment asset concentration ratio and leverage level exceeding the standard

For the first time, a wealth management company was punished by the supervision for the investment asset concentration ratio and leverage level exceeding the standard

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For the first time, a wealth management company was punished by the supervision for the investment asset concentration ratio and leverage level exceeding the standard

Original title: For the first time, a wealth management company that exceeds the investment asset concentration ratio and leverage level is punished by supervision

For the first time, a wealth management company that exceeds the investment asset concentration ratio and leverage level is punished by supervision

China Times (www.chinatimes.net.cn) reporter Feng Yingzi reported in Beijing

Strong financial supervision continues.

Recently, the China Banking and Insurance Regulatory Commission disclosed the results of a special on-site investigation into the wealth management business conducted by some wealth management companies and their parent banks in 2021, and made administrative punishment decisions on the four institutions in accordance with the law.

The reasons for the case involve not only old problems such as “the concentration of investment assets in wealth management products exceeds the standard and the level of leverage exceeds the standard”, but also new problems such as “the wealth management custody business violates the requirements of asset independence and the operation management is not in place”.

It is worth noting that this is the first time that the China Banking and Insurance Regulatory Commission has issued a fine to a bank’s wealth management subsidiary and a commercial bank’s wealth management custody business.

Dong Ximiao, chief researcher of China Merchants Union Finance, told a reporter from China Times that the punishment shows that after the formation of financial management companies and financial management business rules and regulations, the regulatory authorities focus on strengthening the inspection and implementation of rules and regulations to ensure that relevant systems and measures are implemented. Standardized and orderly operation of bank wealth management subsidiaries will promote the healthy development of wealth management business and wealth management market, and better protect the legitimate rights and interests of investors.

Wealth management company fined for the first time

Recently, the China Banking and Insurance Regulatory Commission announced four related fines. The fined institutions include 2 wealth management companies and 2 commercial banks, namely Bank of China Wealth Management, Everbright Wealth Management, Bank of China and China Everbright Bank, with a total fine of 14.9 million yuan.

Judging from the grounds of the case, “the concentration of investment assets in wealth management products exceeds the standard” is a common problem of the two punished wealth management companies. Specifically, the market value of a single public securities investment fund held by a public wealth management product exceeds 10% of the net assets of the product; the market value of a single securities held by all public wealth management products exceeds 30% of the market value of the security.

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At the same time, BOC Wealth Management also involved excessive leverage of open-ended public wealth management products, unfair transactions involving the same counterparty and similar underlying assets under the same contract, illegal use of the amortized cost method for valuation of investment assets in wealth management products, and financial management companies’ The identification of affiliated legal persons does not meet regulatory requirements and other issues.

Everbright Wealth Management involved problems such as substandard proportion of high-liquidity assets held by open-ended public wealth management products, potential risks in the use of third-party mobile office platforms, insufficient information system management and control, and inconsistent and inaccurate publicity of wealth management products.

“In recent years, with the accelerated transformation of wealth management products to net worth, the association between wealth management products and the financial market and other asset management products has increased, which has put forward higher requirements for product liquidity and robustness management.” Dong Ximiao analyzed that the amortized cost method was used in violation of regulations Valuation may make the valuation of wealth management products inaccurate, making it difficult to timely and accurately reflect changes in the value of the underlying assets. Inconsistent and inaccurate publicity of wealth management products may mislead investors and influence investors to make correct investment decisions.

In addition, the common problem of the two penalized banks is that “the scale of old products rebounded at some points in time”. The custodian institution failed to detect the concentration of wealth management products exceeding the standard in a timely manner, and the custody business operation and management were not in place.

“Everbright Financial Management attaches great importance to the opinions and criticisms raised by the regulatory agencies, formulates rectification measures one by one, and conducts investigations and rectifications during the on-site investigation process. Except that the security management and control of the mobile office platform is being continuously optimized and rectified, other problems have been rectified in place. “Everbright Financial Management said that the current wealth management products managed by the company are operating in an orderly manner and perform stably. In the future, we will implement rectification in strict accordance with regulatory requirements, continue to strengthen internal control management and risk management and control, and strengthen system and mechanism construction.

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Dong Ximiao mentioned that wealth management subsidiaries should enhance their awareness of compliance and risk, speed up the rectification of violations, ensure that the whole process of wealth management product development and sales meets the requirements of the rules and regulations, and promote the healthy and sustainable development of bank wealth management.

It is imperative to strengthen internal control management

From the “New Regulations on Asset Management” to the “New Regulations on Wealth Management”, to the Management Measures for Wealth Management Subsidiaries, to the Interim Measures for the Management of the Sales of Wealth Management Products of Wealth Management Companies and the Measures for the Management of Liquidity Risks of Wealth Management Products of Wealth Management Companies, after about four years of hard work , the financial supervision department has initially established a system of rules and regulations for wealth management companies and wealth management business.

By the end of 2021, the rectification of the existing wealth management business has been basically completed, and the chaos of wealth management has been fundamentally reversed. The transformation of the net value of products has achieved positive results, and the industry ecology has been gradually formed. The corporate governance and internal control management of wealth management companies have been gradually improved, and the quality and efficiency of serving the real economy have been significantly improved.

At the end of April this year, the China Banking and Insurance Regulatory Commission announced the “Administrative Measures for the Internal Control of Wealth Management Companies (Draft for Comment)”, which aims to regulate the internal control of wealth management companies.

For the management of the investment process, the above-mentioned measures propose that wealth management companies should clarify the review standards, investment decision-making process, risk control measures and post-investment management of different types of assets, and conduct independent approval and investment decisions for each investment to ensure the direction of capital investment. Strictly comply with national policies and regulatory requirements.

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The relevant person in charge of the China Banking and Insurance Regulatory Commission said that as a new type of asset management institution with independent legal personality, wealth management companies need to build a comprehensive and effective internal control management system as soon as possible, and further build risks in terms of personnel, funds, investment management, information, and systems. Separation wall, improve their ability to operate independently.

At present, a total of 29 wealth management companies have been approved for establishment, of which 25 have been approved to open. As of the end of March this year, the total balance of wealth management products of banks and wealth management companies was 28.4 trillion yuan. Among them, the balance of wealth management company products was 17.3 trillion yuan.

Wealth management companies are in a critical period of “clean start” and urgently need to build an internal control compliance management system that is commensurate with their own business scale, characteristics and risk status, so as to provide a solid guarantee for legal compliance and stable operation.

“In the long run, the risk isolation between the bank’s wealth management subsidiaries and the parent bank is still the biggest problem.” Zeng Gang, director of Shanghai Finance and Development Laboratory, said that the original intention of setting up wealth management subsidiaries was to isolate risks and avoid the emergence of wealth management products. The risk is transmitted to the parent bank, which needs to be blocked from the corporate governance level, and at the same time, it must be isolated from the capital and other aspects.

In addition, Dong Ximiao proposed that the next step should be to further establish a third-party independent custody system, and the custody of wealth management products should be independently managed by a third party other than the parent bank, so as to better prevent the operation risks of wealth management products and protect the legitimate rights and interests of investors.Return to Sohu, see more

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Statement: The opinions of this article only represent the author himself, Sohu is an information publishing platform, and Sohu only provides information storage space services.

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