JPM and Fidelity mull trust licence in China

J.P. Morgan and Fidelity are planning to gain trust company licences in China, along with many overseas firms seeking to profit from the light regulatory environment in which the vehicles operate.

Chinese regulators are clamping down on inflation through the more heavily regulated banks in order to stem credit growth, while trust companies face less regulation, the Financial Times reports. Banks in the country are also limited in how much they can pay out to depositers, with negative real returns blighting prospects. In contrast, the relative 'light touch' regulation surrounding trust companies is leading overseas investors to believe they are more profitable than other investment wrappers. China has around 55 trust companies, that can create investment products with no limi...