Economic Observer reporter Cai YuekunWanxiang Trust Co., Ltd. (hereinafter referred to as "Wanxiang Trust"), which is part of the financial territory of the "Wanxiang system", is falling into the "whirlpool" of several products being delayed.
Mr. Yu has been a regular customer of Wanxiang Trust for 8 years. He told the Economic Observer reporter that he invested in two products, the Liupanshui Hongqiao Hospital Project Loan Collective Fund Trust Plan (hereinafter referred to as "Health Education No. 2") and the Liupanshui Hongqiao Hospital Medical Care Integration Project Loan Collective Fund Trust Plan (hereinafter referred to as "Health Education No. 4"), with an amount of 3 million yuan and 2 million yuan respectively. Mr. Yu said that from the second half of 2023, these two products have failed to be paid as scheduled, and "all the belongings saved by thrift have gone to invest in trust products."
Ms. Chen, a VIP customer of Wanxiang Trust for more than 10 years, has also purchased a number of Wanxiang Trust's products. Ms. Chen said that in the investor group of Wanxiang Trust, some investors have invested in 9 products, and 7 have been delayed; There are also investors who have invested in 4 products, and 3 have suffered delays.
According to incomplete statistics from the screenshots of the announcement provided by several investors, Wanxiang Trust has more than 10 trust products that cannot be redeemed normally, and the types of deferred projects are mainly real estate and infrastructure trust plans.
On December 8, Wang Yonggang, president of Wanxiang Trust, mentioned at a public briefing for investors that not all real estate projects have problems, one-third of real estate projects are operating normally, and two-thirds do have financial problems. At present, the balance of the company's real estate projects is about 8.5 billion yuan, and the balance of ** infrastructure projects is about 2 billion yuan.
From December 11 to 12, 2023, the board of directors and shareholders of Wanxiang Trust said that they would provide Wanxiang Trust Company with a variety of assistance, including financial support, to ensure the company's stable and continuous operation.
Wanxiang Trust was established in 2012. According to the company's shareholding structure information, China Wanxiang Holdings holds 77 Wanxiang Trust70% of the shares, the largest shareholder; Zhejiang Tobacco Investment Management Co., Ltd. is its second largest shareholder, holding 1315%；China Post Asset Management, a subsidiary of China Post, holds 403% equity; Juhua Group holds 291% equity; Zhejiang Provincial Financial Holdings*** holds 222% equity.
In the trust industry, Wanxiang Trust is a trust institution known as "small but beautiful". Why has Wanxiang Trust frequently taken risks since the second half of 2023, and what kind of "hidden worries" have been buried in the heavy real estate business for the company? At present, how Wanxiang Trust survives the redemption crisis has become the focus of investors' attention.
Nearly 1 billion projects have been postponed
Screenshots of WeChat chats provided by a number of investors of "Health Education No. 2" and "Health Education No. 4" show that at the beginning of their purchase of the above products, the financial manager of Wanxiang Trust made it clear that this was a project led by the company itself, and it was to guarantee the payment anyway.
Investors said that the financial manager once said that the two products of "Health Education No. 2" and "Health Education No. 4" cannot be bought by others if they want to, and it is very difficult to get the quota reserved for VIP customers. According to the promotional materials of "Health Education No. 2", the risk level of the product is "low risk", but at the same time, its product risk description also mentions that the trust plan does not promise capital preservation and minimum returns, and has certain investment risks. According to the promotion materials of "Health Education No. 2" and "Health Education No. 4", the funds of the two products are used for the development and construction of the Liupanshui Hongqiao Hospital project and the development and construction of the medical and elderly care integration project of Liupanshui Hongqiao Hospital respectively.
In August 2023, the postponement announcement of "Health Education No. 2" showed that the product was established on December 16, 2019, and the trust plan funds were invested in Guizhou Wanhua Medical Real Estate in the form of "shares + debts". At the same time, since its establishment, the trust plan has faced the impact of unfavorable factors such as the new crown pneumonia epidemic, real estate policy regulation and control, and economic downturn, and the overall operation and sales of the project have not met expectations. Based on the above, the term of each term of the trust units has been extended by 6 months.
In November 2023, the postponement announcement of "Health Education No. 4" showed that the product was established on November 5, 2021, and the trust plan funds were used to issue trust loans to the borrower, Guizhou Wanhua Medical Real Estate, and finally used for the development and construction of the medical and elderly care integration project of Liupanshui Hongqiao Hospital. The medical care project involved in the trust plan failed to pay the trust income of the previous period as scheduled due to the overall project operation and sales not meeting expectations.
An investor in Wanxiang Trust's products said frankly that the two products involved in the Liupanshui Hongqiao Hospital project and the medical care integration project raised a total of nearly 1 billion yuan, why could they not cover the construction costs? The trust company needs to provide a specific statement on the whereabouts of the trust funds.
The investor said that in June 2023, more than a month before "Health Education No. 2" could not pay interest, "Health Education No. 4" was still raising new funds.
Real estate and infrastructure products are out of insurance
According to incomplete statistics from the screenshots of the announcement provided by several investors, since 2023, Wanxiang Trust has had a number of real estate trust products that have been unable to distribute trust income to beneficiaries on time due to the failure of the financier to pay interest. Among them, more than 10 real estate companies such as Aoyuan, Jinke, Kaisa, and Xiangsheng are involved, with a cumulative amount of more than 4 billion yuan. Most of Wanxiang Trust's real estate and infrastructure trust products that have been postponed were established from 2020 to 2022.
Mr. Cui in Hangzhou told reporters that he has invested in nine products under Wanxiang Trust, mainly real estate and infrastructure projects. Among them, 8 products have been postponed, including "Real Estate 982", "Real Estate 980", "Real Estate 1043" and so on.
In April 2023, the trust period of all types of trust units existing under trust unit I of "Real Estate No. 1043" (Kaisa Dongdaihe Qiyuetai Phase II Project Collective Capital Trust Plan) was uniformly extended to February 6, 2025, and the trust period of trust units under trust unit II was extended to August 6, 2025.
In September 2023, the interim disclosure report released by "Real Estate 982" showed that "Real Estate 982" (Zhongang Yuyao Xiangyun Mansion Phase I Project Loan Collective Fund Trust Plan) was established on December 3, 2020. The term of all types of trust units in the existence of the trust plan will be uniformly extended to June 10, 2024.
In October 2023, "Real Estate No. 1022" (Xiangsheng Yueyang Jinlin Mansion South Plot Project Loan Collective Fund Trust Plan) was established on April 15, 2021. The maturity date of the trust plan has been uniformly extended to July 15, 2024.
As for the reasons for the product delay, Wanxiang Trust mentioned that the real estate industry regulation policy has been continuously optimized since the end of 2022, and the policy easing will be further increased in 2023, but it will still take some time for the market to recover as a whole. The employer failed to pay the interest on the trust loan on time.
Mr. Cui's investment in infrastructure products such as "Infrastructure No. 177" and "Infrastructure No. 187" has also been delayed.
In September 2023, "Infrastructure No. 177" (Climbing Kaitou Debt Receivables Investment Collective Fund Trust Plan), the trust plan funds were used to purchase its receivables from Guizhou Liupanshui Climbing Development Investment *** to the Finance Bureau of Zhongshan District, Liupanshui City. During the operation of the trust plan, the trustee actively followed up and communicated with the financier and the guarantor on the repayment of the interest on the financing funds, and dutifully performed the duties of the trustee. However, as of the date of this announcement, the trust plan has not received the interest on the financing money returned by the financier, resulting in the trustee being unable to distribute the trust income to the beneficiaries this time.
The real estate business is one of the "heavy" businesses of Wanxiang Trust.
Wanxiang Trust's annual report shows that as of the end of 2021, the distribution of its trust business assets shows that the scale of the real estate industry is 5855.4 billion yuan, accounting for 6008%；The scale of basic industries is 434.7 billion yuan, accounting for 446%；As of the end of 2022, the distribution of Wanxiang Trust's trust business assets shows that the scale of the real estate industry is 5212.3 billion yuan, accounting for 5840%；The scale of basic industries is 400.1 billion yuan, accounting for 449%。
Compared with the end of 2019, the asset distribution of its trust business shows that the scale of the real estate industry is 6794.9 billion yuan, accounting for 5078%；The scale of basic industries is 1893 billion yuan, accounting for 1415%。Although the scale of Wanxiang Trust's real estate industry in 2021 and 2022 will shrink compared with the end of 2019, the proportion of business has increased.
In October 2020, Wang Yonggang, president of Wanxiang Trust, said in an interview that there are two main dimensions for the real estate companies that Wanxiang Trust chooses to cooperate with: first, the list released by CRIC is one of the important references; The second is the deep cultivation of regional leaders, there will be some specific measurement standards, such as the top 5 in the province, the top 3 prefecture-level cities, and the first county-level cities. For regional leaders, Wanxiang Trust has always maintained a focus and has accumulated rich experience in cooperation. From the second half of 2017 to 2018, Wanxiang Trust found a number of enterprises in a period of rapid development and increased support to help them reach a higher level.
Wanxiang Trust's strategy of heavy real estate has laid "hidden concerns" for its real estate trust business.
From the perspective of the industry as a whole, real estate trusts were once an important business of trust companies and an important income**. In recent years, due to regulatory policies and the overall environment of the real estate industry, the proportion of trust funds invested in real estate in the industry has been declining.
According to the China Trust Association, the proportion of trust funds invested in real estate has been declining since 2013, but there has been a significant increase after 2017, and it has maintained a rapid growth rate in 2017 and 2018. In the context of the decline in the scale of trust assets, the main reason for the increase in the scale of real estate trusts may be that their income levels are high and they are more attractive to funds.
According to data from the China Trust Association, as of the end of the fourth quarter of 2019, the total amount of trust funds invested in the real estate sector in the industry was as high as 27 trillion yuan. As of the end of June 2023, the balance of trust funds invested in real estate was 105 trillion yuan, down 366.1 billion yuan from the same period last year, a year-on-year decrease of 2587%。
We will actively respond to the difficulties of the period
In December 2023, some of Wanxiang Trust's projects were suspended and products were postponed, which attracted widespread attention in the market. Wanxiang Trust continues to release news of actively mitigating risks.
On December 7, Wanxiang Trust's official WeChat announced that in 2023, all performance indicators of Wanxiang Trust will be progressing in an orderly manner as planned. In response to regulatory requirements, the company broke the rigid payment, accelerated the return to the origin of the trust system, and opened up a new situation in the company's transformation. The company continued to reduce the scale of its financing business, especially in the real estate sector, with a scale reduction of 70% in the past three years, and continued to reduce its risk exposure. With the support of a series of policies such as guaranteed delivery of buildings, the company's related projects have been steadily constructed. At the same time, with the gradual implementation of the first-class debt plan, local debts have been initially alleviated, and some of the company's political and credit trust products have been successfully liquidated and withdrawn.
On December 8, Wanxiang Trust held an open day for investors to answer various questions that investors are concerned about. Wang Yonggang, president of Wanxiang Trust, said that the company attaches great importance to investors, will put the interests of investors first, and manage each project in accordance with the law and compliance with the law in a conscientious manner.
Regarding the current situation of Wanxiang Trust, Wang Yonggang explained to investors that the company is still in normal operation and meets the regulatory indicators given to the company by the regulatory authorities. In the second half of this year, public opinion on the default of a number of projects of Wanxiang Trust suddenly broke out, some of which involved real estate-related projects. Affected by market changes, the real estate market has a large deviation from the company's previous expectations and predictions. By this year, the real estate market has picked up, and under such conditions, Wanxiang Trust's real estate project funds have been withdrawn by 1 4.
Wang Yonggang said: "At present, the underlying mortgage assets of the real estate projects at risk are sufficient, including land, residential buildings, and projects under construction. The situation of each risk project is different, and each has its own contradictions, which we must analyze and resolve one by one. ”
Regarding the handling of postponed projects, Wang Yonggang said: "Each project is led by the risk management department and the trust manager to set up a one-on-one special working group, and all the personnel of the company are going all out to deal with the risk projects. ”
Wang Yonggang said: "We have a lot of existing projects, but the amount is very small, most of the projects (the amount) are less than 100 million yuan, it is relatively easy to deal with, we have the ability and confidence to deal with the risk projects." ”
According to the information released by Wanxiang Trust's official WeChat, from December 11 to 12, 2023, Wanxiang Trust held a meeting of the board of directors and the general meeting of shareholders. The board of directors and the general meeting of shareholders of Wanxiang Trust will earnestly implement various regulatory provisions, support the company's transformation and development, actively respond to the phased difficulties faced by some trust projects, and provide Wanxiang Trust Company with a variety of assistance, including financial support, to ensure the steady and sustainable operation of the company.
On December 15, the reporter called the relevant people of Wanxiang Trust on the extension of Wanxiang Trust's products and the progress of risk resolution, and the other party replied that the announcement would prevail. Subsequently, the Economic Observer will also continue to pay attention.