Chinese regulators making new rules for trusts

Caixin reports China’s banking regulator said it is developing new rules for trust companies so they can shed their image as “shadow banking” channels to help uncreditworthy firms get loans. The new regulations will center on dividing trust products and services into eight categories based on how funds are invested, said Yang Jiacai, assistant to the chairman of the China Banking Regulatory Commission (CBRC), which supervises trust companies. He made his remarks at a meeting organized by the China Trustee Association. The classification will address some of the most pressing concerns the regulator has about trust companies. Unlike their namesakes in other countries, trust companies in China often act as a channel through which companies can get loans when they have trouble borrowing directly from banks.