Fund firms seeking opportunities in China have a longer list of possible partners under a new rule issued by China's central bank, reports Reuters.

The Chinese authorities posted rules on its Web site that would allow commercial banks to form mutual funds. The rules would specifically allow banks to invest in money market instruments and bonds during an initial trial period. Later, they rules could change to allow bank to invest in more risky securities, presumably stocks.

U.S. firms seeking entry to the Chinese fund market must partner with a local firm. The new rules would open the possibility of additional alliance partners for the U.S. firms. The Chinese fund industry is still emerging and holds just $36 billion in assets, according to Reuters.

Merchants Bank, Minsheng Banking Corp. and Pudong Development Bank are mentioned by Reuters as banks interested in offering mutual funds.  

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