Beijing, May 9:

China regulators may allow increased overseas investment in local trust firms in an effort to bring more professional management skills to the graft-plagued industry, state press said Wednesday.

Regulators are considering raising the investment ceiling for foreign investors from 25 per cent to 49 per cent in the trust companies, the China Daily said.

“Some large foreign companies, with approval from financial regulators, might also control a trust firm with more than a 49-per cent stake,” the paper quoted an unnamed official close to the State Council, or cabinet, as saying.

Chinese trust companies, often labelled as “international trust and investment corporations” or “itics,” have been wracked with credit crises stemming from illegal trading and a lack of risk management, the report said.

The aim the new investment policy is to attract foreign strategic investors to help restructure

trust firms into professional wealth management institutions, the report said.

As of September 2006, China had 54 trust firms, managing combined assets of 317.8 billion yuan (41 billion dollars).