On 24 June 2020, the China Banking and Insurance Regulatory Commission (CBIRC) issued a circular on Carrying out the Follow-up Checks for the Rectification of Market Problems in the Banking and Insurance Sectors.
The CBIRC proposes to launch follow-up checks to review the steps taken to correct industry problems identified in the past three years following some high-profile cases, particularly in the areas of corporate governance, risk management and repeated violations of several laws and regulations.
In the past three years, the CBIRC has been pushing companies in the banking and insurance sectors to address various issues including insufficient corporate governance, infringement on consumer rights, and industry-specific integrity risks. The CBIRC required banks and insurance companies to review major issues identified and potential risks existing in their daily operations, take corrective action, and hold individuals concerned liable.
The CBIRC is now undertaking follow up checks to see if:
- Relevant entities and persons have fulfilled their responsibilities to rectify identified problems;
- The economy has benefitted from the rectification;
- Rectification measures are thorough and effective;
- Violations have been greatly contained; and
- Compliance mechanisms are sound and function effectively.
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