(Yicai Global) Dec. 27 -- The China Banking and Insurance Regulatory Commission has approved the applications to set up independent wealth management subsidiaries by two big state-owned lenders, China Construction Bank and Bank of China. 

It also noted that many other commercial banks are likewise scrambling to apply to get in on this business, the commission announced today. 

The CBIRC will assist banks in setting up wealth management subsidiaries to ply this business, cultivate and strengthen their teams of institutional investors, and guide wealth management funds to support the real economy and invest in financial markets in a lawful and standardized manner, based on new administrative measures for wealth management units of commercial banks that issued on Dec. 2. 

BOC applied on Nov. 15 to become first among large state-owned banks to offer these asset services, per an earlier notice in which the lender said the registered capital of its Beijing-registered subsidiary will be up to CNY10 billion (USD1.5 billion). 

CCB also announced it will set up a wholly-owned wealth management affiliate with a registered capital of up to CNY15 billion on Nov. 16, saying the investment is to adapt to changes in the internal and external economic and financial environments and promote the sector's sustainable and healthy development. 

Twenty-six commercial banks in China have also thrown their hats into the ring thus far, including five state-owned ones, nine urban commercial ones, two rural commercial ones and Postal Savings Bank of China.

Regulators introduced a raft of new rules for wealth management in April this year that encourage commercial lenders to form separate subsidiaries for this trade. 

These provisions will help these units to independently offer such services while isolating risks to prevent these from spilling over and impacting the big banks' other businesses. 

Editor: Ben Armour