SHANGHAI, Aug. 14 -- YUAN-BACKED individual investment products more than tripled in banks in Shanghai in the first half, the market regulator said today.

Banks in Shanghai launched 25.99 billion yuan (US$3.43 billion) of investment products for individuals in the first half, growing 209.22 percent from a year ago, the Shanghai Bureau of the China Banking Regulatory Commission said today in a statement.

``Banks are launching new investment products at a faster pace and the focus is on index funds, stock, overseas funds and commodities compared to traditional interest rate- and foreign currency-linked products,'' the local banking regulator said.

The booming stock market is the driving force behind the shift. The benchmark Shanghai Composite Index has risen about 76 percent this year after rising 100 percent in 2006.

With the trend, investors opted to take more risk as non-principal guarantee products added 13.75 billion yuan in the first half, more than double the figure for last year.

Small and medium banks are taking more market share with innovative products, holding 75.28 percent of yuan investment products. The big-five banks are not only feeling the squeeze from smaller Chinese banks, but also from competition with overseas banks with strength in foreign exchange-backed products.

The outstanding value of forex-backed investment products more than doubled to 10.29 billion yuan from a year ago at overseas banks, accounting for a 40 percent market share.

Yuan-backed products outpaced foreign currency ones on the strength of a rising yuan and the booming domestic stock market.

The yuan has gained about nine percent since China dropped its decade-long peg to the greenback in July 2005.

Banks added a total of 18.55 billion yuan of forex-backed products in the first half, up 31.22 percent from a year ago.