As a basic regulation that regulates the functional positioning and operation management of trust companies, a new version of the “Trust Company Management Measures” is planned to be released. “Economic Information Daily” reporters learned from industry insiders that the regulatory authorities have recently issued the “Trust Company Management Measures (Revised Draft for Comments)” (referred to as the “Draft for Comments”) to trust companies. The “Draft for Comments” emphasizes corporate governance, further clarifies the management and obligations of shareholders, and lists nine prohibited behaviors including “fund pooling” and certain channel businesses. In this regard, industry experts said that the new regulations have raised the risk defense line of the trust industry and are conducive to the high-quality transformation of the industry.
It is reported that the “Draft for Comments” includes a total of seven chapters including general principles, organization establishment and changes, corporate governance, business scope and business rules. It places special emphasis on corporate governance and details the management and obligations of shareholders; both trust culture and compensation management are written into it, requiring trust companies to clarify the triggering conditions and scope of application for deferred payment of performance compensation and the pursuit of clawbacks; in trust In the way of asset use, the loan function is retained; trust companies are required to withdraw 5% of after-tax profits as trust compensation reserves every year, and there is no longer a total proportion limit.
“The emphasis on corporate governance is the biggest feature of the “Draft for Comments”. The third chapter of the 2007 version of the “Trust Company Management Measures” is ‘Business Scope’, while the third chapter of the revised ‘Draft for Comments’ is ‘Corporate Governance’ ‘, and the ‘business scope and business rules’ will be merged into Chapter 4.” A trust researcher in Beijing said that the clarification on the deferred payment of performance-based compensation and the pursuit of clawbacks will have a great impact on trust company staff, especially senior managers. Illegal operations have a great deterrent effect.
The new regulations emphasize the management and obligations of shareholders in many places. Shareholders of a trust company should assume a number of obligations, which are specified in the articles of association of the trust company. The main content includes a commitment not to pledge the equity held by the trust company or to use the equity and its beneficiary (income) rights to establish trusts and other financial products, except for special circumstances such as risk disposal measures approved by the regulatory authorities. If investors and their affiliates or persons acting in concert individually or collectively hold less than 5% of the shares of the same listed trust company in the same listed trust company, they are not subject to the regulations.
In addition, the “Draft for Comments” requires major shareholders to provide the trust company with their own operating status, financial information, equity structure, actual controller and other information in a timely, accurate and complete manner; if a trust company encounters a risk event or major violation of regulations, shareholders should Cooperate with regulatory agencies in conducting investigations and risk management. When a trust company encounters situations such as endangering its continued operations and jeopardizing financial order, its major shareholders promise to provide assistance through replenishing capital, clawback of previous years’ dividends, and liquidity support borrowings.
“In recent years, some institutions have indirectly held shares through financial products, preventing shareholders from being exposed to the sun. The new regulations are conducive to the penetrating management of trust companies by regulatory authorities and prevent trust companies from intentionally or unintentionally shielding and obscuring the actual controllers. In addition, it can Prevent certain hostile acquirers from controlling listed trust companies by issuing or purchasing financial products, and make the equity holding and management of trust companies more scientific and standardized.” The above-mentioned trust researcher said that when trust companies are in crisis, shareholders must commit Relief through capital replenishment and other means not only protects the interests of investors, but also reflects the main role of shareholders.
In terms of business scope, the “Draft for Comments” clarifies that the business scope of trust companies includes asset service trust business, asset management trust business, charity trust business, inherent asset business and liability business, and provides financial consulting for enterprises to issue direct financing instruments. Underwriting services, trustee services, investment advisory, custody and other technical services for asset management products, and other businesses approved by the State Financial Supervision and Administration Bureau.
“These regulations leave room for ‘non-standard’ business.” A senior trust expert said that in fact, the previously issued new asset management regulations did not cancel the non-standard asset business, but limited the overall scale. In the future, “non-standard” trust businesses may have stricter regulatory requirements on specific businesses.
It is worth mentioning that the “Draft for Comments” also lists nine prohibited behaviors in trust business, including capital pool business and certain channel businesses. In addition, regulatory authorities also intend to build a defense line against high industry risks. In the “Draft for Comments”, the cumulative total amount of compensation reserves is no longer subject to the total proportion limit.
“With the decline in industry prosperity, trust project risks have repeatedly occurred, the industry’s non-performing rate has gradually increased, and individual trust companies have even fallen into operating difficulties. In this “Draft for Comments”, the cumulative total of compensation reserves is no longer limited by the total proportion. , which is also the intention of the regulatory authorities to build a higher defense line for industry risks.” A trust manager in southwest China said bluntly.
In fact, my country’s general risk reserves and trust compensation reserves have shown a growth trend in recent years. According to the latest research report of Yunnan Trust, 52 trust companies will withdraw 53.48 billion yuan in general risk reserves and trust risk compensation reserves in 2023, a year-on-year increase of 7.5%.
“The increase in general risk reserves and trust compensation reserves not only shows that trust companies are paying more attention to the protection of customer interests, but also represents that trust companies have effectively improved their awareness of risk prevention. However, in the future, we must also strengthen the efficiency of the use of reserves, both It cannot be abused or misused, nor can it be allowed to lie on the accounts and sleep for fear of affecting reputation.” said the above-mentioned trust researcher.