The calm before the storm is the darkest and most depressing.

Since early June, targeted financing plan wealth management products (hereinafter referred to as “fixed financing products”) sold by Zhongzhi Enterprise Group Co., Ltd. (hereinafter referred to as “Zhongzhi Group”) and its related parties have been unable to be redeemed when due.

No significant improvement.

Historically, June and July each year were the times when Zhongzhi Group's liquidity was most scarce. In the past, payment of some fixed financing products had been delayed for more than 10 working days, but the amount and duration involved were not the same as this time.

For more than a month, sales staff from four wealth management companies affiliated to Zhongzhi Group frantically forwarded policy documents supporting the development of the private economy on their WeChat Moments, while Zhongzhi Group was busy issuing various announcements to dispose of assets and reassure people.

Referring to the experience of wealth management companies that have exploded due to capital chain ruptures in the past few years, a crisis process has slowly unfolded; generally speaking, this process begins with the sales team struggling to raise funds to fill the liquidity gap, and ends with investors collectively reporting the case.

Zhongzhi Group claims to have "asset management scale of nearly one trillion yuan" and "more than 10,000 employees". It has stakes in more than a dozen listed companies, as well as Zhongrong International Trust Co., Ltd. (hereinafter referred to as "Zhongrong Trust"),

Hengbang Property & Casualty Insurance Co., Ltd. (hereinafter referred to as: Hengbang Property & Casualty Insurance Co., Ltd.), Hengqin Life Insurance Co., Ltd. and Zhongrong Fund Management Co., Ltd.

The financiers of Dingrong products are all members of Zhongzhi Group, and the counterparties involved are also related parties.

Although it holds shares in Zhongrong Trust and Zhongrong Fund, the fixed financing products are not sold through these two licensed institutions, but are handed over to Hengtian Wealth Investment Management Co., Ltd. (hereinafter referred to as "Hengtian Wealth"), Xinhu Wealth

Investment Management Co., Ltd. (hereinafter referred to as "Xinhu Fortune"), Datang Fortune Investment Management Co., Ltd. (hereinafter referred to as "Datang Fortune") and Gaosheng Fortune Holding Group Co., Ltd. (hereinafter referred to as "Gaosheng Fortune")

Fortune Company Sales.

Due to their huge size and large number of practitioners, these four companies are often collectively referred to as the "Big Four" in the wealth management field.

The industry generally holds a pessimistic attitude towards the prospects of Zhongzhi Group.

However, the industry is relatively optimistic about Zhongrong Trust, which operates settlements independently and stays out of the fixed-finance products; a practitioner said that Zhongrong Trust and Zhongzhi Group are “completely cut off” and “have liquidity problems.

The products have already been transferred to the Big Four," so "Zhongrong should not be affected."

All core assets are pledged. An industry insider who once worked for the Big Four told Buqi Finance that the predecessor of fixed financing products can be traced back to before 2013. The channel used at the beginning was a private equity fund in the form of a limited partnership, and later changed to a contract type.

For private equity funds, after the promulgation of the "New Asset Management Regulations", the Asset Management Association prohibited contractual private equity funds from making fixed-income products, and fixed-income products issued through local financial exchanges began to follow.

There is a conscious separation between Zhongrong Trust and Zhongzhi Group.

Prior to this, the Big Four underwrote most of Zhongrong Trust’s collective trust plan products.

Zhongrong Trust began to set up its own sales team, Zhongrong Wealth; and then handed over political trust, real estate and other products to Zhongrong Wealth for sales; however, some fund pool products are still underwritten by the four majors, and the four majors are still selling Zhongrong Trust

capital pool products.

The "New Asset Management Regulations" promulgated in 2018 became a watershed in the relationship between the two.

Starting this year, the sales staff of the Big Four were prohibited from printing the words "Zhongrong Trust" on their business cards, and they were also prohibited from calling themselves employees of Zhongrong Trust during the sales process.

In March 2018, Zhongrong Trust's largest shareholder Jingwei Textile Machinery (000666, sz) issued the "Major Asset Restructuring Suspension Announcement", which planned to acquire 32.9864% of Zhongrong Trust's equity held by Zhongzhi Group; if the transaction is completed

, Jingwei Textile Machinery will hold 70, 4562% of the equity of Zhongrong Trust, achieving absolute control, while Zhongzhi Group will withdraw from the list of shareholders of Zhongrong Trust.

However, with the resignation of Zhang Jie, chairman of Hengtian Group, the major shareholder of Jingwei Textile Machinery, no one mentioned the acquisition since then.

In addition to regulating sales and equity transfers, Zhongrong Trust also strives to reduce its contact with Zhongzhi Group in public information.

Based on the information disclosed by the National Enterprise Credit Information Publicity System, the number of businesses in which Zhongzhi Group and its member companies pledge equity to Zhongrong Trust (this business is usually related to financing loans or guarantees) ranges from 1 to 3 transactions each year.

However, the sudden death of Xie Zhikun, the actual controller of Zhongzhi Group, caused a fundamental reversal of this trend.

Zhongzhi Group member companies pledged 11 equity shares to Zhongrong Trust, which are: 1. Huzhou Zhongzhi Rongyun Investment Co., Ltd. pledged 94.97 million shares of Guangdong Wanchengwanzhong EMU Operation Co., Ltd.

2. Zhonghai Shengtai (Beijing) Capital Management Co., Ltd. pledged 1.47 million shares of Zhongzhi New Energy Automobile Co., Ltd.

3. Huzhou Mingdao Asset Management Co., Ltd. pledged 596 million shares of Bama New Energy Technology Co., Ltd.

4. Zhongzhi Group pledged 346.2 million shares of Hengbang Property & Casualty Insurance.