In the first half of 2024, Shandong International Trust Co., Ltd. (hereinafter referred to as “Shandong Guoxin”) continued to consolidate a “steady and healthy” business foundation and accelerate the construction of a “specialized and refined” business system through a series of innovative initiatives and strategic layout, showing a steady, moderate and positive development trend.

I. Overview of first half year results and business development

Against the backdrop of the overall operating conditions of the trust industry under pressure, the overall performance of Shandong Guoxin was relatively stable.

According to the announcement, in the first half of 2024, Shandong Guoxin achieved total revenue of 0.587 billion yuan and total profit of 0.253 billion yuan. Although net profit of 0.171 billion yuan decreased slightly from the same period last year, the operating profit margin increased from 33.0% to 43.1%, showing that the company focuses on structural optimization and efficiency improvement on the basis of steady operation.

In terms of operating results, Shandong Guoxin has achieved significant growth in the capital market and family trust business. In the capital market business in particular, by deepening cooperation with major channels, the company has accelerated the cultivation of active management capabilities and increased the scale of active management products. In terms of family trust business, the company is actively developing new circuits for insurance fund trusts and family service trusts, and the scale growth rate has accelerated markedly.

In terms of core philosophy, Shandong Guoxin continues to adhere to the strategy of “seeking progress through stability” and steadily advance various tasks around annual business goals by adapting to industry trends and regulatory guidelines. In terms of business development, the company insists on returning to the roots of trust, promoting a sharp rise in business volume and quality, while actively implementing the concept of “finance for the people”, improving the level of financial services and effectively protecting the rights and interests of financial consumers.

In addition, the company has also contributed in the field of green finance, supporting major regional strategies and strengthening financial support for the transformation and upgrading of the regional economy. In terms of risk management, the company continues to improve the risk prevention and control system and mechanism process, optimize the full-process management system, and improve the efficiency of risk management work.

In summary, Shandong Guoxin's performance and business in the first half of 2024 reflect the undertones of steady development, steady, moderate and positive business strategy and market adaptability, and strives to get closer to the company's long-term development plans and goals.

2. Deepen the original business and implement the new regulations

In the first half of 2024, Shandong Guoxin continued to deepen its original business, improve the quality and efficiency of the business, and lay the foundation for long-term stable development. The built-in business continued to be optimized. The revenue of the inherent business segment reached 0.317 billion yuan. Through adjustments in fair value change income and investment income, asset allocation was optimized, and the efficiency of capital use was improved.

In terms of its original business, Shandong Guoxin mainly focuses on enhancing competitive advantage and economies of scale, and accelerating the increase in the business's contribution to profits.

In terms of scale, the scale of the company's trust asset management has achieved steady growth. By the end of June 2024, the size of trust assets managed by the company reached RMB 241.237 billion, an increase of RMB 39.816 billion compared to the beginning of the year, achieving an increase of 19.77%. In terms of capital market business expansion, the company has implemented a “enhanced layout” strategy, deepened cooperation with major channels in the capital market, accelerated the cultivation of active management capabilities, and significantly increased the scale of active management products. By the end of June 2024, the survival scale of the securities investment trust business exceeded RMB 100 billion, an increase of RMB 42.246 billion over the beginning of the year, an increase of 73.10%.

In the first half of the year, the company launched product performance and industry recognition. For example, the performance of products such as Taishanbao and Shandong Construction and Development Fund launched by the company continued to surpass similar products in the market, and won the 2023 “Excellent Bond Investment and Trading Institution (Trust Type)” award from the Shenzhen Stock Exchange, reflecting the high recognition of the company's product performance and management capabilities by the industry and the government.

Shandong Guoxin is also actively promoting innovative businesses such as foreign tax residents, stock services for listed companies, and shareholder services for listed companies, and broadening its business areas and market influence in the capital market.

In addition, the company continues to strengthen its dominant position in the family trust business and actively expand new fields such as insurance fund trusts and family service trusts. The scale of family trusts grew rapidly in the first half of the year. As of the end of June 2024, the operating scale of family trusts was close to RMB 47 billion, an increase of 32% over the previous year, and more than 130 family service trusts had been established.

Finally, I have to mention that in the field of charitable trusts, the company has also continued to expand participants and application scenarios, successfully implementing the first single and double trustee charitable trust in Shandong, injecting the “warm current” of trusts into philanthropy, demonstrating the company's positive contribution to social responsibility.

Through these initiatives, Shandong Guoxin has not only achieved double growth in scale and advantages in the trust business field in the process of focusing and deepening its original business, but has also achieved certain breakthroughs in emerging business fields, showing that the company has a certain leading position and development potential within the industry or region.

3. Implement “finance for the people” and focus on improving services

In the first half of 2024, Shandong Guoxin strives to fully reflect the service concept of “finance for the people” through implementation measures in the following three main areas, which can reflect the following three directions:

First, it is reflected in innovation in wealth management.

Shandong Guoxin has shown new ideas and strategies in the field of wealth management. It is committed to providing more professional, personalized and high-quality services to meet the growing wealth management needs of customers. Specific innovations include:

1) Diversified asset allocation: The company promotes the transformation of wealth management business to diversified asset allocation, provides a wider range of asset class choices, and adapts to the risk preferences and return goals of different customers.

2) Special wealth management accounts: By the end of June, 41 special wealth management accounts had been managed, indicating that the company had made significant progress in providing personalized and customized services.

3) Model based on the customer's “trust account”: gradually form a wealth management model based on the customer's “trust account” to provide customers with more flexible and convenient services.

Second, promote the growth of family trusts in scale and the pursuit of product innovation.

In the first half of the year, Shandong Guoxin's family trust business achieved rapid growth. The survival scale was close to 47 billion yuan, an increase of 32% over the previous year. This not only reflected the strong demand for this service in the market, but also proved the effectiveness of the company's innovation in the family trust field. It is mainly reflected in actively developing new business areas, broadening the scope of services, and meeting the needs of different customers, such as the new circuit of insurance trust and family service trust.

The last aspect is the effective improvement of financial service capabilities. In the first half of the year, the company's financial service capabilities were mainly reflected in financial consumer rights protection, investment education activities, and digital capacity building.

1) Actively carry out financial consumer rights protection and investment education activities: In the first half of the year, the company strengthened financial consumer rights protection, actively carried out financial investment education activities, and improved the accessibility and interactivity of financial services through a combination of online and offline methods. The multi-channel and diversified publicity and education coverage of offline customer activities and online channels (such as apps, WeChat accounts, SMS platforms) has enhanced consumers' understanding of financial markets and products.

2) Deepening digital capacity building: Shandong Guoxin is promoting digital capacity building, using technology such as big data and artificial intelligence to improve the level of intelligence and personalization of services, driven by the integration of steady state and agile states; building service-oriented technological capabilities to fully support business development. It can also reflect Shandong Guoxin's continuous innovation in technology applications, and is committed to improving service efficiency and quality.

Through efforts and breakthroughs focusing on the above three directions, Shandong Guoxin has fully and multifaceted demonstrated its professional ability and innovative spirit in the field of financial services. At the same time, it has also demonstrated its commitment to providing high-quality and personalized services to meet the needs of customers. Implementing “finance for the people” and focusing on improving services is never an empty phrase here at Shandong Guoxin, but a real action.

4. Adhere to equal emphasis on green finance and regional development

In the first half of this year, Shandong Guoxin not only promoted the development of green finance, but also actively integrated into the overall regional development situation, contributing to the sustainable development of the local economy through financial innovation and service optimization.

Shandong Guoxin responded positively to the national green development strategy and vigorously developed the green trust business. Through the Green Trust, the company supports a series of ecological protection projects and the development of green industries, such as new energy, energy saving and environmental protection. This not only promotes environmental protection and the construction of ecological civilization, but also reflects the company's active implementation of social responsibilities. By the end of June 2024, the scale of green trust assets reached RMB 3.556 billion, and the green trust business of RMB 0.726 billion was added in the first half of the year. This shows that the company's concept of green development and ESG responsible investment continues to be consolidated.

Shandong Guoxin used trust tools to provide strong financial support to the local economy and promoted the transformation and upgrading of the regional economy. The most common example worth sharing is that the company provided financial support for infrastructure construction, industrial and commercial enterprise development through trust plans. In particular, the major strategy for ecological protection and high-quality development in the Yellow River sector has exerted a leading demonstration effect of state-owned capital.

Furthermore, through bankruptcy and restructuring service trusts, the company effectively bailed out the real economy, revitalized existing assets, and further promoted the healthy development of the regional economy.

This strategy, which places equal emphasis on green finance and regional development, is undoubtedly more conducive to achieving a win-win situation between economic benefits and environmental benefits. The Shandong Guoxin Institute highlights the responsibility and long-term development vision of financial institutions, and provides a meaningful demonstration role for the industry and society.

5. “Strengthening+Optimization”: the trinity of risk control, compliance and management

While pursuing business development and strategic layout, Shandong Guoxin also pays great attention to internal management and construction. Its approach can be summarized as two “enhancements” and two “optimizations”, as shown below:

1) Strengthen risk control: Through continuous improvement of the risk management system, Shandong Guoxin has achieved optimal management of the entire process from pre-investment due diligence to post-investment follow-up and monitoring. This includes strengthening temporary project management and risk investigation, and improving the efficiency and level of specialization in risk identification, assessment and disposal.

2) Strengthen compliance: In the first half of 2024, the company will strengthen the cultivation of a compliance culture and the implementation of compliance management to ensure that business development is in sync with regulatory requirements. Improve compliance through system building and process optimization, such as carrying out anti-money laundering and anti-terrorist financing efforts, and strengthening compliance management and culture building.

3) Optimizing management mechanisms: Shandong Guoxin has always adhered to party building leadership to improve work style and efficiency; deepened strategic management, and improved the adaptability and effectiveness of strategic planning. At the same time, promote digital capacity building, driven by the two-state integration of “steady state and agile”, build service-oriented technological capabilities, and fully support business development and service innovation.

4) Optimizing system construction and mechanisms: In the first half of 2024, Shandong Guoxin will continue to promote the construction of corporate governance structures and internal control systems in terms of corporate governance, and optimize decision-making processes and execution mechanisms. By consolidating the foundation of corporate governance, completing the election of the board of directors and supervisors, optimizing the organizational structure and personnel structure, and scientifically formulating performance assessment indicators.

Through the “enhancement+optimization” measures described above, Shandong Guoxin has essentially established a three-in-one comprehensive risk control management system covering risk control, compliance and management mechanisms.

This system ensures the scientific and forward-looking nature of corporate governance, only improves its own management level and efficiency, lays a solid foundation for the company's steady operation and high-quality development, and can also provide solid support for the company's long-term development and market competitiveness.

Summary section

Shandong Guoxin's performance in the first half of the year not only reflected the company's firmness and wisdom in facing changes in the industry, but also demonstrated its determination and ability to promote the return of the trust industry to its roots and serve the real economy.

Looking forward to the future, Shandong Guoxin will continue to promote innovation around the three main business development directions of capital markets, family trusts, and wealth management, continuously improve service capabilities, gather core advantages, and actively implement ESG responsibilities, so as to continuously explore the company's new development model and move forward steadily on the path to achieving high-quality development goals.