Managed assets post slow growth
Print Edition
ASSETS managed by trust firms in China grew slowly in 2014 as the economy slowed and competition intensified, according to an industry report.
The 68 trust firms in the country managed a record high 13.98 trillion yuan (US$2.25 trillion) last year, the China Trustee Association said in an annual report yesterday.
But the annual growth rate of 28.14 percent moderated from the 46.05-percent increase in 2013, the data showed.
“A weak economy depressed the sector while increasingly fierce competition also ate into the traditional businesses,” the association said.
China’s trust sector is losing momentum after years of rapid expansion as regulators step up oversight of off-balance-sheet lending that poses a rising risk to the country’s financial stability.
Last year, profits of trust companies totaled 64.2 billion yuan, up 12.96 percent from 2013. However, profit per capita fell for the first time by 1.5 percent to 3.01 million yuan, data showed.
Despite the headwind, trust companies generated more returns for beneficiaries, with proceeds amounting to 450.6 billion yuan, up 53.06 percent annually.
As of the end of last year, 369 projects had repayment problems, involving funds of 78.1 billion yuan, or 0.56 percent of the total managed assets, below the bad loan ratio in the banking sector, the association said.
Industrial and commercial enterprises were most attractive to trust companies, taking up 24.03 percent of funds. The infrastructure sector took up 21.24 percent of trust funds last year, followed by 17.39 percent in financial institutions.
Equities took up 14.18 percent of funds, an increase from 10.35 percent in 2013 in response to a robust stock market. The property sector took up 10.04 percent of trust funds.
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