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The
regulator will loosen restrictions that limit how commercial
banks, insurance companies and pension funds invest in commodity
futures, Fang Xinghai, vice chairman of the China Securities
Regulatory Commission (CSRC), said in a speech on Saturday that
was released on the CSRC's website.
Fang, who was speaking at a financial forum in Qingdao, did not
give further details on the proposal.
His comments underscore growing government backing for
derivatives markets for commodities ranging from copper to oil
to fruits in a bid to support the real economy, as Beijing ramps
up regulation of equities markets and tries to tame its red-hot
property market.
However, any major push by wealth managers into the futures
sector could also increase volatility in prices of raw
materials, like iron ore, which have been whipsawed by
speculative and institutional investors in recent years.
"Commodities are indispensable resources for the industrial
economy," Fang said.
While securities and futures institutions had developed
derivatives-based products for commodities, the overall size was
still small, he said.
Exchanges must continue to develop futures and options contracts
to add to the 54 existing agricultural, metals, energy and
financial products, while regulators will accelerate efforts to
open up commodity markets to foreign investors, he said.
To illustrate the vast size of China's personal wealth, Fang
referred to a report by Boston Consulting Group, which showed
assets held by individuals reached 1.2 trillion yuan ($176
billion) last year, behind only the United States.
About 40 percent of that is in bank savings and wealth
management, another 40 percent is in real estate, 10 percent in
the stock market and another 10 percent in trusts and other
products, the report showed.
($1 = 6.8121 Chinese yuan renminbi)
(Reporting by Josephine Mason; Editing by Richard Pullin)
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