(Bloomberg) -- China plans to start regulating large conglomerates that may pose systemic risks to the nation’s financial sector.

Certain non-financial firms or individuals with businesses that straddle at least two financial industries will be classified as “financial holding companies” and will need licenses from the People’s Bank of China to operate, the regulator said in draft proposals Friday. If adopted, the proposals would require the companies to hold specified levels of capital and regulators would scrutinize their ownership structure, related transactions, and source of funding.

Public feedback is sought through Aug. 24 on such structures where “risks have accumulated and are being exposed constantly,” the PBOC said.

The authority last year identified HNA Group Co., Fosun International Ltd., China Evergrande Group, and Tomorrow Holding Co. as “financial holding companies,” as well as internet giants such as Ant Financial. The firms’ growing role in the nation’s money flows and financial plumbing make them targets for authorities who’ve already shackled over-leveraged acquirers and reined in the sprawling shadow-banking system.

At the end of 2016, about 70 central-government owned enterprises had a total of over 150 financial subsidiaries, a central bank official said in March last year. Another 28 private firms each had stakes in at least five financial units.

To contact Bloomberg News staff for this story: Jun Luo in Shanghai at jluo6@bloomberg.net

To contact the editors responsible for this story: Sam Mamudi at smamudi@bloomberg.net, Jeanette Rodrigues, Marcus Wright

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