China Banking and Insurance Regulatory Commission (CBIRC) chairman Guo Shuqing has warned that all kinds of “black swan” and “grey rhino” events may occur at any time. A black swan is an unpredictable event that is beyond what is normally expected with severe consequences, whereas a grey rhino event refers to a highly obvious yet ignored threat. Guo said that these unforeseen occurrences may happen during China's economic development. Guo said that China's development has entered a period in which strategic opportunities, risks, and challenges co-exist, with uncertain and unpredictable factors increasing. Guo said China will let failed financial enterprises withdraw from the market at minimum cost, to safeguard the interests of the people. He added that financial institutions should set up “living wills”, a contingency plan for an orderly resolution in bankruptcy during financial distress, to avoid bigger systemic risks.
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