Sichuan Trust is a non-bank financial institution, based in China.^[1] It is headquartered in the southwest city of Chengdu.^[2] It is one of the shadow banks in China.

Current Issues

In May 2020, Sichuan Trust disclosed about a 20 billion yuan deficit. Later, the deficit was estimated to be as much as 30 billion yuan.^[1]

Sichuan Trust's financial difficulty started when the Chinese government began restricting new sales of trust products in 2020, which caused a loss of new incoming revenue from new investors so Sichuan Trust could not pay its debts.^[2]

According to Diana Choyleva, chief economist at Enodo Economics, Sichuan Trust was the earliest to fail during the Chinese economic configuration.^[1][3]

In 2021, police arrested Liu Canglong, Sichuan Trust's majority shareholder, who was a mining and real estate tycoon and was once the richest man in Sichuan province for embezzling trust funds.^[2]

In January, several investors contacted China's National Administration of Financial Regulation to find out what assets were underlying the investments but were told that the information was a "state secret".^[3]

References