Investment highlights: Anxin Trust announced its 2017 annual report. In 2017, it achieved revenue of 5.592 billion yuan (+6.60%, YoY), net profit to mother of 3,668 billion yuan (+20.91%, YoY), and basic earnings per share of 0.8 yuan. Total assets at the end of the period were $16,191 billion (+31.37%, YoY), and total managed trust assets were $232,551 billion (-1.02%, YoY). It is proposed to distribute cash of 5 yuan (tax included) to shareholders for every 10 shares, and the capital reserve will be increased by 2 shares for every 10 shares. Ping An's view: Trust size is basically flat, and revenue growth is slowing down. Active management capabilities have improved, and Anxin Trust achieved net profit of 3.68 billion yuan in 17, a year-on-year growth rate of 20.9%, which is a year-on-year growth rate of 20.9%, which is a slowdown from 76% in 2016. Looking at the main business, the growth of the company's trust revenue has slowed, and the year-on-year growth rate of trust fees fell to 16.7% from 95% in 2016. We believe that, on the one hand, it may be influenced by the pace of confirmation of the company's trust revenue, and on the other hand, due to the company's control over the scale of the trust business. Anxin Trust managed a trust asset scale of 232.5 billion in 2017, which is basically the same as at the beginning of the year (234.95 billion). However, benefiting from the improvement of the company's active management capabilities, the company's share of actively managed trusts increased by 8 percentage points to 68%, thus driving the company's trust business return rate to increase by 37BP to 1.92%. The return rate of trust business remains high compared to the same industry, reflecting Anxin Trust's better profitability. Looking ahead to 2018, the company's 6.8 billion yuan preferred stock supplementary net capital plan is progressing steadily, helping to enhance the company's capital strength and cope with regulatory influence. We believe that the increase in trust size is expected to be limited under stricter regulations, but the improvement in the company's active management capabilities is expected to hedge against the impact of limited scale, thus ensuring a steady growth in the company's performance. Inherent business: Revenue declined in '17; to be observed in '18. Judging from the company's inherent business contributions, 1) Net interest income in the 17-year statement contributed 126 million yuan, a year-on-year decrease of 29%, mainly due to the company taking into account liquidity considerations in '17, increasing the investment ratio of deposits and securities with higher profitability, and reducing the return on total assets. 2) Investment income contributed 784 million, an increase of 181% over the previous year. On the one hand, due to the adjustment of accounting accounts from fair value to investment income (+156 million yuan), on the other hand, after refinancing twice in 16 years to supplement capital, the company increased its investment in various businesses. 3) Profit from changes in fair value - 598 million yuan. Apart from accounting adjustments, the financial assets held by the company are mainly affected by the decline in capital market stock prices (estimated impact of about 400 million yuan). We need to pay close attention to the impact of the capital market on the elasticity of the company's performance in '18. Investment advice: The main contribution of the company's trust business is steady, and the improvement in active management capabilities reflects the company's core competitive advantage and helps cope with the impact of the decline in channel business. The company is actively transforming into equity investment, family trusts, wealth management, etc., and the future layout of diversified finance is worth looking forward to. Considering the company's active transformation to deal with regulatory shocks, we slightly raised the company's 18/19 net profit growth forecast by 21%/18.6% (previously 21%/17%). The company's current stock price corresponds to PE13.2x/11.1x and PB3.03x/2.55x in 18/19. As a growth target among listed trust companies, it maintains the company's “Highly Recommended” rating. Risk warning: Industry regulations are getting stricter, and capital market valuations fluctuate greatly.