Trust companies have accelerated their moves into equity investments since the beginning of the year. Firms such as Minmetals Trust, CITIC Trust, and Guomin Trust have successively invested in establishing equity investment funds to expand their presence in this sector.
This trend is not entirely new. Since 2022, companies including CCB Trust, Bank of Communications Trust, and Shaanxi International Trust have already begun exploring equity investments. Notably, Bank of Communications Trust has identified private equity as a key strategic focus, targeting industries aligned with national priorities such as integrated circuits, artificial intelligence, and biopharmaceuticals.
The intensified activity reflects a broader industry shift as trust companies navigate a transitional period. With traditional revenue streams under pressure, firms are exploring new business models and diversifying their operations in response to policy guidance and market demands.
However, whether equity investments can evolve from a niche endeavor to a mainstream business remains uncertain. Industry insiders highlight several challenges, including shortages of specialized talent and the need for appropriate performance evaluation mechanisms. Over the longer term, deeper professional specialization, innovative product structuring, and digital transformation will also be critical to sustained growth.
As trust companies work to address talent gaps and refine internal mechanisms, their path forward in equity investment will depend on balancing strategic breakthroughs with long-term cultivation.
Multiple Firms Enter Equity Investment Arena
Several trust companies have entered the equity investment space this year. For example, Minmetals Trust has already launched four venture capital funds, including Suzhou Shengxin Qixing Phase I Venture Capital Partnership and Shenzhen Qihang Innovation Investment Partnership, all targeting unlisted enterprises.
One of its latest funds, Suzhou Shengxin Qixing Phase I, was established in collaboration with Shanghai Shenghe Private Fund Management, with a total scale of 1 billion yuan. Minmetals Trust committed 900 million yuan to the fund.
CITIC Trust and Guomin Trust have also made moves in this area. In February, CITIC Trust, through its subsidiary CITIC Juxin Capital Management, jointly invested 300 million yuan to establish the Hangzhou Xiaoshan Jinkai Gongrong Juxin Equity Investment Partnership. In January, Guomin Trust committed 50.0545 million yuan for a 98.0413% stake in the Caida Guomin Kangheng (Xiong'an) Technology Innovation Equity Investment Fund.
Equity investment initiatives by trust companies date back to at least 2022. Besides the aforementioned firms, others such as CCB Trust, Bank of Communications Trust, Shaanxi International Trust, Daye Trust, and Huaxin Trust have also engaged in related activities.
Some, like Bank of Communications Trust, have explicitly designated equity investment as a strategic priority. The firm’s annual report highlighted private equity business as a key area, involving direct investment in industrial PE funds, acquisition of existing limited partner (LP) shares, or establishing private equity investment funds through subsidiaries. Its investments focus on strategic sectors such as integrated circuits, AI, new energy, biomedicine, and high-end equipment manufacturing.
According to the 2023 Trust Industry Research Report, trust companies typically engage in equity investment through three models: direct investment via trust plans, participation as an LP in private equity funds, or establishing PE subsidiaries to conduct equity investments. Currently, the most common and mature approach is the LP model, where trust companies invest as limited partners in partnership-structured funds, sharing returns without engaging in daily management—a structure that limits risk exposure.
Growing Share of Proprietary Business
As the trust industry undergoes profound transformation, revenue structures are shifting from short-term gains toward long-term strategic positioning. A notable trend is the rising contribution of proprietary business income.
Proprietary business refers to activities conducted using a trust company’s own capital, including interbank deposits, lending, and investments. These operations are independent of trust services.
An analysis of 2025 financial reports by Yunnan Trust highlighted significant divergence in industry revenue structures, with proprietary business income reaching 31.375 billion yuan—nearly half of the sector’s total—reflecting a 73.06% year-on-year increase. The ratio of trust business income to proprietary business income has shifted from a stable 7:3 in prior years to nearly 5:5.
Yunnan Trust noted that this shift reflects both transitional characteristics and structural adjustments in profit models. While new trust businesses such as standardized product trusts and asset servicing trusts require upfront investment in trading, operations, and research, they also entail longer incubation periods. In the short term, trust business revenue remains under pressure. The surge in proprietary business income, meanwhile, is largely attributable to positive capital market returns, with firms that allocated resources to equities seeing significant gains.
Looking ahead, proprietary business income is expected to help offset revenue pressures during the transition. Against this backdrop, equity investment is seen as one of several diversification strategies available to trust companies.
Yuan Jiwei, an asset management researcher, explained that trust companies engage in equity investment for two main reasons. On the proprietary business side, PE investments help optimize asset allocation, enhance returns, and support the real economy. On the trust business side, historically dominated by fixed-income products, equity investments offer a way to develop higher-yield offerings that meet investor demand in a low-interest-rate environment.
A report by SDIC Taikang Trust noted that equity investment business can bring four key benefits: facilitating a shift from indirect to direct financing, fostering a long-term ownership mindset versus short-term creditor thinking, supporting real economic development through integrated financial services, and cultivating new growth areas amid regulatory tightening.
A trust company representative in Eastern China added that equity investment aligns with policy calls for patient capital and long-term funding support. However, given the high-risk, high-volatility nature of such investments, firms must carefully assess their internal resources, team capabilities, and risk appetite.
Talent and System Shortfalls Require Attention
Despite increased activity, equity investment is unlikely to become a mainstream trust business in the near term. Yuan Jiwei pointed out that the field is highly competitive and inherently risky. Trust companies remain in an exploratory phase and must develop specialized, distinctive equity products to compete with established PE firms.
The Eastern China trust representative also emphasized that, beyond team and resource readiness, operational systems and foundational mechanisms need further refinement.
Recent policy developments, such as pilot programs for equity trust property registration in cities like Beijing and Shanghai, represent a positive step. While the direct impact may be limited initially, these measures help clarify ownership, reduce legal risks and transaction costs, and indirectly support the stable development of equity investment business over the long term.
Liao Hekai, an industry observer, suggested that as business practices and regulatory frameworks mature, trust companies’ equity investment operations are likely to enter a more standardized and scalable phase.
For now, however, talent and institutional mechanisms remain the primary hurdles. Yuan Jiwei stressed that success in equity investment requires deep industry and operational expertise, as well as performance evaluation and incentive systems tailored to the distinct nature of equity investments, which differ significantly from fixed-income products.
In the longer run, the sustainability of trust companies’ equity investment efforts will hinge on deeper professional分工, product innovation, and digital empowerment. Liao Hekai projected three key trends: greater specialization, innovative product structures, and digital transformation. Trust companies will need to build larger professional teams, integrate equity investment with other trust services, and utilize diverse financial instruments—such as asset securitization, mergers and acquisitions, and mezzanine financing—to offer comprehensive financial solutions.
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