China Further Expands Pilot Program for Equity Investment by Financial Asset Investment Companies

On March 5, 2025, the National Financial Regulatory Administration (NFRA) issued the Notice on Further Expanding the Pilot Program for Equity Investment by Financial Asset Investment Companies (the “Notice”), which took effect immediately. The Notice aims to further optimize and refine the existing pilot policy.

The Notice expands the pilot program in the following three aspects:

First, it broadens the scope of equity investment by financial asset investment companies to the provinces where the pilot cities are located. The Notice clearly states that relevant funds can conduct equity investments within these provinces, aiming to attract and encourage more social capital to participate in fundraising.

Second, the Notice supports eligible commercial banks in initiating the establishment of financial asset investment companies.

Third, it encourages insurance funds in participating in the equity investment pilot program of financial asset investment companies. The notice specifies that insurance funds are allowed to invest in private equity investment funds issued by the affiliated institutions of financial asset investment companies, bonds issued by financial asset investment companies, or to acquire stakes in financial asset investment companies, all in accordance with laws and regulations.