China issues rules on trust firms, shadow-banking

China's banking watchdog and other seven government agencies are launching a program tackling fake trust companies.

Regulators are saying these fake trust companies absorb deposits and funding without providing trust services.

Meanwhile, China's State Council is said to issue new rules to strengthen regulation of the shadow-bank lending that has helped fuel an explosion in debt levels since 2008.

The wide-ranging new rules contain new restrictions on banks' cooperation with trust companies, securities brokerages and other intermediaries. The rules also address internet finance, micro-lending, and informal lending by friends and family members.