China's trust industry debuts offshore bond

China's enormous shadow banking sector steps into the international spotlight, with the pricing of a debut offshore bond issue by Zhongrong International Trust.

Zhongrong International Trust became the first issuer from the Chinese trust industry to venture into the offshore bond markets on Monday with a $225 million three-year transaction. 

Over the past decade trust companies have become the second largest segment of China's financial sector behind commercial banks, racking up assets of Rmb14.41 trillion $2.32 trillion by the end of the first quarter.

Their growth has fuelled demand for the kind of credit and returns the largely state-owned banking sector has been unable to provide. However, many believe regulation has failed to keep pace with the expansion of the shadow banking sector, which relies on short-term retail and...

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