Bank of Communications (BoCom), the nation's fifth-largest lender, launched an insurance joint venture with Commonwealth Bank of Australia in Shanghai Thursday, the bank said.

BoCommLife Insurance Co. is the first bank-controlled insurer in China. The China Banking Regulatory Commission issued a regulation last November to allow banks to take stakes in insurance companies.

The BoCom has a 51 percent stake and Commonwealth Bank has a 49 percent stake.

BoCommLife Insurance Co. was earlier China Life-CMG Life Assurance that was set up in June 2000. The bank bought the stake from China Life.

The joint venture has a registered capital of 200 million yuan (29.3 million U.S. dollars).

BoCommLife Insurance Co. is planning to increase capital to 500 million yuan in the near term and to set up subsidiaries in Shanghai, Beijing, Jiangsu, Zhejiang and Guangdong, it said.

Niu Ximing, BoCom's president, said at the launching ceremony that the joint venture will help the bank divert business and boost wealth management levels.

Tu Guangshao, vice mayor of Shanghai, said that allowing banks to take stakes in insurers is a new step in China's finance reforms and will have deep impacts on the development of the banking and insurance industries.

China Construction Bank and Bank of Beijing are yet to get regulatory approvals to buy into Pacific-Antai Life Insurance Co. and ING Capital Life Insurance Co, respectively.