Bankrupt Sichuan Trust Seeks Investors to Bring Business Back

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Sichuan Trust in April received approval from the top financial regulator to wind down

Sichuan Trust Co. Ltd., which defaulted on billions of dollars in trust products four years ago, has begun to seek investors for its bankruptcy reorganization.

The bankruptcy administrator of Sichuan Trust Tuesday published a statement inviting investors to take part in the company’s restructuring. The investors will provide funds to resolve the debt risks of Sichuan Trust, optimize its asset structure and ultimately fully restore the normal operations of Sichuan Trust, said the statement.

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Sichuan Trust, which defaulted on over 20 billion yuan ($2.9 billion) in 2020, is seeking investors for bankruptcy reorganization.
Investors must have at least 3 billion yuan in registered capital and no major legal issues in the past three years.
The company faced a 34.9 million yuan fine and was eventually taken over by the Sichuan government for restructuring.

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Who’s Who

Sichuan Trust Co. Ltd.: Sichuan Trust Co. Ltd. defaulted on over 20 billion yuan in trust products in 2020, leading to regulatory actions and investor protests. The company is now seeking investors for bankruptcy reorganization. Potential investors must have significant financial strength and submit their plans by specific deadlines. Shudao Investment Group is a likely candidate. Sichuan Trust was fined 34.9 million yuan for various legal breaches, and its operations are currently supervised by the Sichuan government.

Shudao Investment Group Co. Ltd.: Shudao Investment Group Co. Ltd. is a Sichuan government-owned enterprise that took over Sichuan Trust’s unpaid debts from individual investors. It's likely to be a candidate in Sichuan Trust's bankruptcy reorganization. Shudao Investment co-owns Tianfu Chunxiao, a company set up to acquire trust beneficiary rights from individual investors affected by Sichuan Trust's default, alongside Chengdu Xingshuqing Enterprise Management Co. Ltd.

Chengdu Xingshuqing Enterprise Management Co. Ltd.: Chengdu Xingshuqing Enterprise Management Co. Ltd. is an investment vehicle owned by the Qingyang district government in Chengdu. It co-owns Tianfu Chunxiao alongside Shudao Investment, a company established to acquire trust beneficiary rights from individual investors of Sichuan Trust, partially redeeming their principal investments.

Tianfu Chunxiao: Tianfu Chunxiao is a newly established company by the Sichuan government in late 2023 to acquire trust beneficiary rights from individual investors who had invested in Sichuan Trust products. It aims to partially redeem the principal invested by these individuals. Tianfu Chunxiao is equally owned by Shudao Investment Group Co. Ltd. and Chengdu Xingshuqing Enterprise Management Co. Ltd., an investment vehicle of the Qingyang district government in Chengdu.

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What Happened When

May 2020：: Sichuan Trust failed to repay more than 20 billion yuan, triggering protests by investors.

December 2020：: The local government in Sichuan and the local branch of the China Banking and Insurance Regulatory Commission took control of Sichuan Trust.