Quick Take on MCV Regulatory Changes and Thoughts on MFC and SLF

Research evidence excerpt

Quick Take on MCV Regulatory Changes and Thoughts on MFC and SLF

Financials | Global Insurance - Life

June 08, 2026

Thomas Gallagher, CFA Quick Take on MCV Regulatory Changes

212-446-9439

Thomas.Gallagher@EvercoreISI.com and Thoughts on MFC and SLF

David Motemaden, CFA Last week, China Securities Regulatory Commission announced a

212-497-0832 crackdown on several broker dealers’ cross-border operations,

David.Motemaden@evercoreisi.com highlighting already tightened regulatory scrutiny on capital outflows.

Nicolas Lu News reports also indicated some banks are pausing opening HK bank

212-497-0812 accounts for mainland residents. Following the news, some players in

Nicolas.Lu@evercoreisi.com the broker market sold 30-40% (FUTU and TIGR), and shares of AIA

Peter Knudsen and Prudential plc, major players in the Mainland Chinese Visitors

212-708-8497 (MCV) insurance markets in Hong Kong, also sold off by around 7-8%.

Peter.Knudsen@evercoreisi.com Alternatively, MFC and SLF remained largely flat, despite having some

related exposure on the insurance side. After some discussions with

market participants, we believe the current regulatory change only

applies to investment products and not insurance products at this point.

We think the selloff on the insurance side is driven by some anticipation

that it could spill over into insurance.

In the event that it does spill over onto the insurance side (and it very

well may not), we think it would be a manageable impact for MFC and

SLF, as we suspect that it’s not much more than 10% of both

companies’ total Asia sales.

HK insurance market had a HK$220bn (or US$28bn) of first year

premiums as of 2024, and MCV of HK$63bn is about 30% of that

market. At AIA, MCV business is about 20% of total company’s new

business volume.