Measures for the Regulatory Assessment of the Corporate Governance of Banking and Insurance Institutions
Measures for the Regulatory Assessment of the Corporate Governance of Banking and Insurance Institutions
Measures for the Regulatory Assessment of the Corporate Governance of Banking and Insurance Institutions
Yin Bao Jian Gui [2022] No.19
November 28, 2022
Chapter I General Provisions
Article 1 The Measures are formulated in accordance with laws and regulations including the Company Law of the People's Republic of China, the Law of the People's Republic of China on Commercial Banks, the Law of the People's Republic of China on Banking Supervision and Administration and the Insurance Law of the People's Republic of China as well as regulatory provisions with a view to pushing forward banking and insurance institutions to improve the effectiveness of their corporate governance, and boosting the long-term, stable and sound development of the banking and insurance industries.
Article 2 For the purpose of the Measures, the regulatory assessment of corporate governance means that the China Banking and Insurance Regulatory Commission (the "CBIRC") and its local offices conduct judgment, evaluation and classification in terms of corporate governance level and risk profile of banking and insurance institutions, and implement classified regulation based on the assessment results, in accordance with the law.
Article 3 The Measures shall apply to commercial banks, commercial insurance institutions and other non-banking financial institutions (legal persons) established in accordance with the law within the territory of the People's Republic of China, including: large state-owned commercial banks, joint-stock commercial banks, urban commercial banks, private banks, rural commercial banks, rural cooperative banks, foreign banks, insurance group (holding) companies, property insurance companies, reinsurance companies, life insurance companies, mutual insurance societies, captive insurance companies, financial asset management companies, financial lease companies, finance companies of enterprise groups, auto finance companies, consumer finance companies and money brokerage companies.
Article 4 The regulatory assessment of the corporate governance of banking and insurance institutions shall follow the principles of legality and compliance, objectiveness and fairness, uniform standards and clear priorities.
Chapter II Assessment Contents and Methods
Article 5 The regulatory assessment of the corporate governance of banking and insurance institutions shall mainly include the following contents: leadership of the Communist Party of China (the "CPC"), governance over shareholders, governance over affiliated transactions, governance over the board of directors, governance over the board of supervisors and senior management, internal control of risks, market constraints, and governance over other stakeholders, among others.
Article 6 The regulatory assessment of corporate governance shall include three steps: compliance evaluation, effectiveness evaluation, and downgrading due to major matters.
1. compliance evaluation: with the maximum score of 100 points and the aim mainly to check whether the corporate governance of a banking or insurance institution conforms to laws, regulations and regulatory provisions, the competent regulatory authority will give a score upon evaluation respectively of the relevant indicators item by item;
2. effectiveness evaluation: with the focus laid on checking the actual effects of the corporate governance mechanism of a banking or insurance institution and the main attention paid to prominent problems and risks, the competent regulatory authority will take points off in light of the effectiveness evaluation indicators based on the compliance evaluation, and may add extra points in terms of the good practice of the banking or insurance institution improving the effectiveness of corporate governance; and
3. downgrading due to major matters: where an institution has any major deficiency or even failure in its corporate governance, the competent regulatory authority will downgrade the preceding two comprehensive scores and their corresponding assessment-based levels to form the assessment result.
In the case of any problem with the compliance indicators or effectiveness indicators, which fails to be rectified continuously, more points may be taken off as the case may be; in the case of failure to effect the rectification in the second year, points may be taken off at twice the indicator score; in the case of failure to effect the rectification in the third year, points may be taken off at four times the indicator score; and in the case of failure to effect the rectification in the fourth year, points may be taken off at eight times the indicator score, and so on.
Article 7 The total score of regulatory assessment of corporate governance shall be 100 points, and the assessment-based level shall be divided into five levels: above 90 points, Level A; above 80 points but below 90 points, Level B; above 70 points but below 80 points, Level C; above 60 points but below 70 points, Level D; below 60 points, Level E.
Article 8 An institution who falls under any of the following circumstances may be directly graded as Level E:
1.
......
Yin Bao Jian Gui [2022] No.19
November 28, 2022
Chapter I General Provisions
Article 1 The Measures are formulated in accordance with laws and regulations including the Company Law of the People's Republic of China, the Law of the People's Republic of China on Commercial Banks, the Law of the People's Republic of China on Banking Supervision and Administration and the Insurance Law of the People's Republic of China as well as regulatory provisions with a view to pushing forward banking and insurance institutions to improve the effectiveness of their corporate governance, and boosting the long-term, stable and sound development of the banking and insurance industries.
Article 2 For the purpose of the Measures, the regulatory assessment of corporate governance means that the China Banking and Insurance Regulatory Commission (the "CBIRC") and its local offices conduct judgment, evaluation and classification in terms of corporate governance level and risk profile of banking and insurance institutions, and implement classified regulation based on the assessment results, in accordance with the law.
Article 3 The Measures shall apply to commercial banks, commercial insurance institutions and other non-banking financial institutions (legal persons) established in accordance with the law within the territory of the People's Republic of China, including: large state-owned commercial banks, joint-stock commercial banks, urban commercial banks, private banks, rural commercial banks, rural cooperative banks, foreign banks, insurance group (holding) companies, property insurance companies, reinsurance companies, life insurance companies, mutual insurance societies, captive insurance companies, financial asset management companies, financial lease companies, finance companies of enterprise groups, auto finance companies, consumer finance companies and money brokerage companies.
Article 4 The regulatory assessment of the corporate governance of banking and insurance institutions shall follow the principles of legality and compliance, objectiveness and fairness, uniform standards and clear priorities.
Chapter II Assessment Contents and Methods
Article 5 The regulatory assessment of the corporate governance of banking and insurance institutions shall mainly include the following contents: leadership of the Communist Party of China (the "CPC"), governance over shareholders, governance over affiliated transactions, governance over the board of directors, governance over the board of supervisors and senior management, internal control of risks, market constraints, and governance over other stakeholders, among others.
Article 6 The regulatory assessment of corporate governance shall include three steps: compliance evaluation, effectiveness evaluation, and downgrading due to major matters.
1. compliance evaluation: with the maximum score of 100 points and the aim mainly to check whether the corporate governance of a banking or insurance institution conforms to laws, regulations and regulatory provisions, the competent regulatory authority will give a score upon evaluation respectively of the relevant indicators item by item;
2. effectiveness evaluation: with the focus laid on checking the actual effects of the corporate governance mechanism of a banking or insurance institution and the main attention paid to prominent problems and risks, the competent regulatory authority will take points off in light of the effectiveness evaluation indicators based on the compliance evaluation, and may add extra points in terms of the good practice of the banking or insurance institution improving the effectiveness of corporate governance; and
3. downgrading due to major matters: where an institution has any major deficiency or even failure in its corporate governance, the competent regulatory authority will downgrade the preceding two comprehensive scores and their corresponding assessment-based levels to form the assessment result.
In the case of any problem with the compliance indicators or effectiveness indicators, which fails to be rectified continuously, more points may be taken off as the case may be; in the case of failure to effect the rectification in the second year, points may be taken off at twice the indicator score; in the case of failure to effect the rectification in the third year, points may be taken off at four times the indicator score; and in the case of failure to effect the rectification in the fourth year, points may be taken off at eight times the indicator score, and so on.
Article 7 The total score of regulatory assessment of corporate governance shall be 100 points, and the assessment-based level shall be divided into five levels: above 90 points, Level A; above 80 points but below 90 points, Level B; above 70 points but below 80 points, Level C; above 60 points but below 70 points, Level D; below 60 points, Level E.
Article 8 An institution who falls under any of the following circumstances may be directly graded as Level E:
1.
......