The difference between trust products and fund asset management products

Asset management product is a standardized financial product that Public Offering of Fund management company or securities company, which is approved by the regulatory authorities, raises funds from a specific customer or is entrusted by the property of a specific customer to act as an asset manager, and the custodian institution acts as an asset custodian, and invests with the entrusted property for the benefit of the asset client. At present, there are 91 Public Offering of Fund companies in China, but the CSRC has only approved that 67 Public Offering of Fund companies can set up wholly-owned subsidiaries to do specific asset management business (these can be found on the website of the CSRC)

Differences between asset management products and trust products:

Similarities:

1. It must be reported to the regulatory authorities, the trust is supervised by the CBRC, and the asset management plan is supervised by the CSRC;

2. There are strict regulations on fund supervision and information disclosure;

3. The subscription method is the same, and the project contract and instructions are similar;

4. Different channels with the same essence belong to investment and financing platforms, which can cross many fields such as capital market, money market and industrial market.

Differences:

1. There are only 68 trust companies in China, while there are only 67 asset management companies, so the scarcity of license resources is more obvious;

2. Asset management companies have strong investment and research capabilities, especially in macroeconomic research and industry research. Choosing investable projects under the guidance of such a research team can effectively increase the bargaining power of financing parties and reduce investment risks;

3. The trust is reported to CBRC once, and it can be established after it is fully raised; The asset management plan shall be reported twice, once at the beginning of the fundraising, once for capital verification after the fundraising is completed, and it shall be established two days after the capital verification;

4. The asset management plan has double credit enhancement, which has been reviewed by the asset management company and the regulatory authorities.

5. The asset management plan is small, with a maximum of 2 places.

6. The income is high, and the asset management plan is generally 1%/ year higher than the trust plan; The term is short, and the term of the asset management plan generally does not exceed 2 years

Future trend: The fund special asset management plan is the result of financial innovation advocated by the CSRC. Due to the advantages of strict supervision, flexible operation, high income, unlimited small amount and professional management, it is an inevitable trend for the future fund special asset management to be used to split trust or initiating trust products.

questions and answers on special asset planning of fund subsidiaries

1. How to understand the "rigid redemption" of the quasi-trust business of fund subsidiaries?

first of all, "rigid redemption" is an attitude of the regulatory authorities. The quasi-trust business of fund subsidiaries has a strong expectation of "rigid redemption", which is mainly understood from the following aspects.

first, the regulatory level: the "rigid redemption" of the trust industry is an attitude of the CBRC, and it is not explicitly stipulated. The CSRC and the China Banking Regulatory Commission belong to the same level, and the supervision style of the CSRC is more stable. China Banking Regulatory Commission (CBRC) controls the total amount, while CSRC controls it in advance. We can see from the number of filing times of fund subsidiaries that although CSRC has liberalized the quasi-trust business of fund subsidiaries, it is still cautious in its supervision attitude, and it maintains its strict supervision style by filing before raising funds and filing again after raising funds.

second, the industry development level: as the fund subsidiaries have just started to develop, their initial business guides the development of this industry, so companies in the industry are very cautious in operating their business, which also explains why 67 fund subsidiaries have been established, and most of them are "one-on-one special asset management business".

third, the level of fund subsidiaries: the fund subsidiaries are backed by a strong shareholder background, and their risk resolution ability is also very strong, which is no worse than that of trust (mainly including the resolution of the product's own risk control system, the takeover of major shareholders, the takeover of four major asset management, the takeover of private equity institutions, the takeover of insurance funds, etc.). The trust-like business teams of fund subsidiaries are almost all trust-digging talents. His management style and risk control system continue the rigorous style of the trust industry.

iv. License level: Class trust licenses are still very valuable, which is why after the liberalization of the policy, all fund subsidiaries rushed to compete for this license, and no fund subsidiary dared to break the "rigid redemption" first, thus being inspected by the regulatory authorities and even suspending or stopping special business (that is, class trust business).

5. Personnel and business level: all fund subsidiaries tap talents in the trust industry, and they are all trust business backbones, risk control backbones and middle and senior leaders, all of whom are elites in the trust industry. Their business level can be said to be much higher than the average level of the trust industry, and they are more comfortable in obtaining high-quality trust projects, financing design and risk control, thus ensuring "rigid redemption".

2. The fund subsidiary is supervised by the CSRC. With the ups and downs of the stock market, Public Offering of Fund's products hurt investors, and the trust-like products of the fund subsidiary always make people feel risky. What should I do?

target customers: Public Offering of Fund started his subscription in 1 yuan, and most of his customers are not our high-net-worth customers.

product level: China's stock market, partial stock funds are largely speculative, which is the behavior of investors and speculators. He is willing to take high risks and get high returns, which is essentially different from trust business.

comparative trust: the securities investment-type collective fund trust plan is also non-principal-guaranteed, which is not a problem of the fund subsidiary, but a problem of the invested target and investors' risk preference, and has nothing to do with the regulatory authorities and the design and issuance institutions. What we mean by "rigid redemption" mainly refers to the aggregate products of creditor's rights.

product level: the trust-like products of fund subsidiaries are perfect in terms of the strength of financiers, transaction structure, collateral guarantee and risk control. They are not speculative and uncontrollable, but are essentially different from them.

3. The registered capital of the fund subsidiary is low, and its risk resolution ability is weak. What is the risk resolution ability of his fund subsidiary trust products?

trust's resolution ability: the resolution ability of trust mainly includes product risk control measures, major shareholders' repayment, self-owned funds takeover, fund pool product transition, asset management company takeover, insurance funds takeover, private equity takeover and so on.

The fund subsidiaries are also rich in resolving ability, mainly including product risk control measures, major shareholder repayment, asset management company takeover, insurance fund takeover, private equity takeover and so on. Only less than the trust, there are two means: self-owned funds takeover and fund pool product transition.

Then let's talk about the two missing differences in detail: the takeover of self-owned funds, the so-called self-owned funds, is only the capital injection of major shareholders, because the registered capital of fund subsidiaries is 2 million, and major shareholders can spend less money to improve the efficiency of their capital use, so why should major shareholders increase their registered capital?

when there is a risk event, the major shareholders of the fund subsidiaries have very strong background strength, all of which are large central enterprises, top 5 enterprises in China and top 5 enterprises in the world. They are not weaker than the trust, and the major shareholders of the fund subsidiaries have very good solvency. Moreover, why does the CSRC stipulate that the registration threshold is 2 million? We feel that this is an attitude of the regulatory authorities. The regulatory authorities believe that the quasi-trust business is still very safe within a certain period of time, and the regulatory authorities encourage the institutions they manage to do quasi-trust business. Otherwise, with the stable supervision style of the CSRC's prior control, he would not have issued such a regulation. Transition of fund pool products: the trust-like business of fund subsidiaries. Although we have not seen fund pool products in the market at present, we believe that there will be some in the future, because fund pool products are a manifestation of the independent management ability of fund subsidiaries. With the help of the business teams of fund subsidiaries, the risk control teams are all elites in the trust industry. Their asset management ability, management system and risk control system are very strong. They will also launch fund pool products, and rely on the previous issuance and fundraising channels in Public Offering of Fund to quickly establish a large-scale fund pool product. At present, the term of trust products is one year or two years. Therefore, after the fund pool products of fund subsidiaries have been carefully planned and designed (which should still be strictly planned now), the active management ability of fund subsidiaries and their high-quality trust products are very good guarantees.

4. How can the trust products of fund subsidiaries protect the risks caused by the shortage of staff?

Personnel structure: First of all, the fund subsidiaries are all talents in the trust industry, and they are all trust business backbones, risk control backbones, middle and senior leaders, all of whom are elites in the trust industry. Their business level can be said to be much higher than the average level of the trust industry. They are more comfortable in obtaining high-quality trust projects, financing design and risk control, thus ensuring the safety of trust products.

quantitative analysis: Secondly, let's make a quantitative analysis and make an analogy with Founder East Asia Trust, which is well-known in the market. In 212, the asset management scale of Founder East Asia Trust was 1 billion. According to the calculation of 1 billion, the number of its employees was about 2 (the above data can be found online). The average asset managed by each employee is 1 billion/2 = 5 million, which means that the average asset managed by each employee of Founder East Asia Trust is 5 million/person. As for the fund subsidiaries, as of the first half of 213, the asset management scale of the fund subsidiaries was 6 billion, and the actual business was 19 companies, with an average asset management scale of 6 billion/19 = 3.2 billion. There are about dozens of employees in each fund subsidiary. If we calculate according to the average level of 2, the average number of assets managed by employees in a fund subsidiary is 3.2 billion/2 = 16 million, which is far lower than the average assets managed by each employee in the trust industry. Development of personnel and business scale: at the beginning of its establishment, the fund subsidiary company was all elite teams. With the development of business scale, it will definitely establish the number of teams suitable for the business scale. The excellent management of a company is also one of the important conditions to ensure the healthy and sustainable development of this company. Therefore, the staff of a fund subsidiary are not few in terms of its asset management scale and business development speed, and it can be said that it is more secure than trust, because they are all elites, and their asset management ability is very strong, and on average, the assets managed by each fund subsidiary staff are less than that of trust.

At present, the asset management business is in the initial stage. In order to occupy market share and promote their own brands, they will definitely be particularly strict in project risk control, and will definitely have a great impact on trust companies in the future, and carve up trust companies' projects.

the key to family financial management is to avoid potential risks and ensure the steady preservation and appreciation of property, so no matter what you invest, you must invest in legal and compliant products. Be sure to keep this in mind.