Fund to support trust firms unable to make repayments

China plans to establish a fund to support troubled trust firms as repayment risks accumulate in the 13 trillion yuan ($2.1 trillion) industry.

Under rules jointly issued by the China Banking Regulatory Commission and the Ministry of Finance, each trust firm is required to contribute 1 percent of their net assets to the fund, while each trust product will pay 1 percent of the money raised, according to a statement on Friday.

Premier Li Keqiang is trying to sustain economic growth while containing financial stress after the nation's shadow-banking system started swelling in 2010. Trusts, a high-yield investment, grew in the third quarter at the slowest pace since that year as regulators imposed a stricter approval process on new products and investors grew more wary of defaults.