China Banking Regulatory Commission, Measures for the Administration of the Net Capital of Trust Companies

中国银行业监督管理委员会信托公司净资本管理办法

November 09, 2010 | BY

clpstaff &clp articles

CBRC sets the minimum net capital of trust companies.

Clp Reference: 3610/10.08.24 Promulgated: 2010-08-24 Effective: 2010-08-24

Promulgated: August 24 2010
Effective: as of date of promulgation
Interpreting authority: China Banking Regulatory Commission (CBRC)

Main contents: The Measures states the formula for calculating the net capital of trust companies shall be:

Net capital = Net assets – deductions pertaining to the inherent risks of all types of assets –deductions pertaining to the inherent risks of contingent liabilities – deductions pertaining to other risks as recognised by the CBRC (Article 8)

The net capital of a trust company shall be no less than Rmb200 million (Article 15). Trust companies shall satisfy the following risk control indicators on an ongoing basis:

(1) its net capital shall be no less than 100% of the sum of all types of risk capital; and

(2) its net capital shall be no less than 40% of its net assets (Article 16).

Related legislation: PRC Banking Regulation Law (Revised), Oct 31 2006; and PRC Trust Law, Apr 28 2001, CLP 2001 No.5 p.22

clp reference:3610/10.08.24
promulgated:2010-08-24
effective:2010-08-24

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