China's Anbang Insurance Group on Wednesday said it will receive a 60.8 billion yuan ($9.7 billion) capital injection from an industry fund to stabilize its finances during a search for strategic investors.
The injection from the China Insurance Security Fund, which has been approved by the country's banking and insurance regulator, will "steadily promote risk disposal" and "ensure sufficient solvency" of the group, Anbang said in a news release.
The move is the latest development in Beijing's drive to tighten its grip on the financial sector. In February, the government officially seized control of Anbang and charged Chairman Wu Xiaohui with fraud and embezzlement.
The group had gained international attention for an overseas acquisition spree that included a $2 billion deal for the Waldorf-Astoria New York hotel. But its risky financing tactics are thought to have raised concerns among financial authorities. In May, Chinese regulators banned the sale of so-called universal life policies that were essentially short-term, high-interest savings products.
Anbang said the injection is a "temporary measure," adding that it will begin the process of selecting strategic investors to restructure its business. Private companies with the potential to create synergies are welcome to participate, the insurer said, specifically citing those in the "elderly care, health care and technology" fields.
The company described the China Insurance Security Fund as a "nongovernmental" institution.
Wataru Suzuki and Akihide Anzai