Regulatory Reform Forces China’s Trust Firms to Cut Back on Risky Lending

In recent years, trust companies have been told to reduce the size of their channeling business, shrink the size of their non-compliant financing business and ramp up the disposal of risk assets. Photo: VCG

Following four years of regulatory reform, China’s trust firms are gradually getting back on their feet.

Regulators have been pushing plans to strengthen oversight over the $3 trillion trust industry, in order to help contain risks arising from shadow banking, which has seen a series of crises including those at Sichuan Trust Co. Ltd. and Shanghai-listed Anxin Trust Co. Ltd. (600816.SH).

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