The annual report of the trust has entered an intensive disclosure period. Looking at the annual reports released by many trust companies, risk prevention and resolution are still one of the key and difficult points at present and in the future. As an industry leader, Ping An Trust's annual report has always attracted much attention and is also regarded as a vane for the development of the industry. The following will analyze the risk resolution ability and confidence of Ping An Trust from four aspects of business indicators.
Main Engine
Look at the asset structure and the source of funds
As a financial institution that is "entrusted by others to manage wealth on behalf of others", the asset scale of trust companies has always been an important indicator to measure the degree of development and industry influence. In 2023, Ping An Trust's assets under management will be 662.503 billion yuan, a year-on-year increase of 20.02%. In fact, it is no longer meaningful for trust companies to compete for the total scale of assets, and the real value depends on the "light" and "excellent" of the total scale of assets, the scale and proportion of actively managed trust business, and whether it can stand the test of the cycle and whether it will cause risk exposure. In the process of returning to the origin of the trust industry, the active management ability of trust companies is tested, and only those companies that can adapt to the market development trend and have differentiated active management capabilities can gain advantages in the transformation.
According to Ping An Trust's 2023 performance report, the scale of actively managed trust assets increased by 23.69% over the previous year, accounting for 85.23% of the overall business, and the active management capability continued to improve. Among them, the scale of investment increased by 31.95% year-on-year, and the scale of financing decreased by 23.58% year-on-year, showing a continuous development trend of "two rises and one decline", highlighting the overall stable operation and good asset quality.
(Changes in the asset scale of Ping An Trust in 2023, from Ping An Trust's 2023 annual report)
It is worth noting that in the process of transforming to net worth, it is a general consensus that trusts actively embrace the capital market and accelerate the strengthening and expansion of the securities market trust business. At the end of 2023, Ping An Trust's securities investment assets accounted for about 70.29% of the actively managed trust assets, with a scale of 396.88 billion yuan.
(Ping An Trust's 2023 actively managed trust asset classes, from Ping An Trust's 2023 annual report)
Ballast stone
Look at the development capacity of asset service trusts
When the ancients sailed, they would open a special cabin at the bottom of the ship to place the "ballast stone". In the face of strong winds and waves, the "ballast stone" can ensure the smooth movement of the ship. In the process of transformation and development of the trust industry, asset service trusts play the role of "ballast stone".
The implementation of the "three classifications" of trust business further clarifies the boundaries and connotations of trust business, emphasizes the positioning of trustees, and clarifies the direction of future transformation. The three classifications first emphasize the "service" attribute of trust, and move asset service trust to the first place, while wealth management service trust, as the largest business type of asset service trust, has become an important "beach" position for the transformation and development of major trust companies.
Ping An Trust has positioned its medium- and long-term strategy to build an "asset-light and service-oriented trust expert", which shows the focus of its strategic layout. In 2023, Ping An Trust's asset service trust business has achieved remarkable results, especially relying on the comprehensive financial advantages of Ping An Group, focusing on family trusts, family service trusts, and insurance trusts, and developing its own unique advantages in the blue ocean. As of the end of 2023, the scale of personal wealth management service trusts will be 149.2 billion yuan, with a net increase of 48.3 billion yuan, a growth rate of 48%, of which the scale of insurance trusts will reach 108.2 billion yuan, continuing to rank first in the industry, and the scale of family trusts will reach 41 billion yuan, with a growth rate exceeding the market by 30 percentage points. Ping An Trust has also gradually brought trust services to the public and into the homes of ordinary people, and built and launched a family service trust brand from scratch - Ping An Mingrui Family Service Trust.
At present, with the rapid growth of the wealth management industry in mainland China, the social foundation of wealth accumulation continues to thicken, and the potential demand for trust services continues to be cultivated and released.
Safety mats
Look at the balance sheet and liquidity indicators
Asset and liability management is a key part of the trust company's stable operation, which ensures the company's abundant liquidity and sustainable profitability by matching assets and liabilities, rationally allocating and using assets.
The regulation has set very strict indicators for the net capital risk control of trust companies. For net capital, the regulatory requirement is ≥ 200 million yuan, the sum of net capital and risk capital of each business is ≥ 100%, and the ratio of net capital to net assets is ≥ 40%. Through the dynamic monitoring of risk control indicators such as net capital, it can ensure that the inherent assets of the trust company are sufficient and maintain the necessary liquidity, and the abundant capital strength builds a solid foundation for the sustainable development of the company.
As of the end of 2023, Ping An Trust's assets and liabilities are healthy and liquid, with a net capital scale of 19.609 billion yuan, a ratio of 322.65% of net capital to risk capital of various businesses, and a ratio of 75.25% of net capital to net assets.
(Ping An Trust's 2023 risk control indicators, from Ping An Trust's 2023 annual report)
Early braking
Look at the scale of real estate trusts and financing trusts
The trust industry is accelerating the "divestment" of secondary properties. Real estate trusts have become a history of "soaring all the way", and the entire trust industry is now "stepping on the brakes" without exception, and Ping An Trust is "putting on the brakes early".
Comparing the data in the three years from 2021 to 2023, it can be seen that Ping An Trust's financing business and real estate business continued to decline: In 2021, the financing business decreased by 24%, and the real estate business decreased by 29%. In 2022, the financing business decreased by RMB40.9 billion, or 38%, and the real estate business decreased by RMB33.3 billion, or 68%. In 2023, the financing business will drop by 23.58%, and the real estate business will drop by 53.3%.
(Statistics on the decline of Ping An Trust's financing and real estate businesses in the past three years, data source: Ping An Trust's annual report, of which as of March 2024, real estate trust assets account for only about 1% of the overall assets under management.) ）
Affected by factors such as the overall environment and the downturn in the real estate market, it is not uncommon for real estate trusts to postpone payments. In April, Ping An Trust was misinterpreted as a company-level "thunderstorm" due to the postponement of a real estate project. In the 2023 earnings report, Ping An Trust emphasized that as of March 2024, real estate trust assets accounted for only about 1% of the company's overall assets under management. This shows that the overall risk is completely controllable, and the postponement of individual projects will not affect the company's policy operation. Moreover, the new regulations on asset management have broken the rigid payment of asset management products, and trust products are not principal-guaranteed financial products, so investors should also break the "rigid redemption" thinking and rationally protect their rights.
Ping An Trust emphasized that based on the current real estate market situation, the company adheres to the principle of early detection and early disposal of risk assets, accelerates the disposal of existing risks, strictly controls new risk projects, and achieves positive results in real estate risk reduction.