Core Viewpoint - A new type of trust product featuring "beneficiary representative" clauses is gaining popularity in Jiangsu and Zhejiang regions, offering higher annual yields compared to traditional government credit trusts [1][2]. Group 1: Product Characteristics - Trust products with "beneficiary representative" clauses typically yield 0.3-0.5 percentage points higher than similar conventional products, and can reach up to 7% annual yield [1]. - These products are often used to replace local government financing, referred to as "fixed income replacement" trust products [1][2]. - The distribution of trust assets to the beneficiary representative signifies the completion of the trustee's responsibilities, terminating the trust plan [2]. Group 2: Market Dynamics - Major trust companies like Jingu Trust and Daye Trust are actively selling these "fixed income replacement" products in the Jiangsu and Zhejiang regions [2][3]. - The products are primarily marketed to local investors and are not listed in the company's direct sales system, differing from traditional government credit trusts [2][3]. Group 3: Regulatory and Risk Considerations - The presence of "beneficiary representative" clauses allows trust companies to classify these products as channel-type, thus avoiding responsibility for defaults [3][4]. - There are concerns that the beneficiary representatives may be shell companies linked to the financing parties, complicating recovery in case of defaults [4]. - Regulatory measures have been implemented to limit the scale of channel-type business, with a significant reduction in financing trust scale observed since 2019 [5][6]. Group 4: Industry Perspectives - Some industry insiders suggest that the emergence of fixed income replacement trusts may indicate a return to channel business practices, despite regulatory pressures [7]. - The financing platforms utilizing these products generally possess better ratings than traditional fixed income entities, potentially lowering financing costs without adding new debt [8][9]. - There is speculation that regulators may not yet be fully aware of the existence of these trust products, as they focus on reported project elements rather than specific contract details [10].