What does a trust company do

As a financial institution, trust companies are entrusted by customers to manage their monetary funds and physical property instead of the principal, carry out multilateral credit behavior of margin financing and securities lending, and provide trust business in two ways: entrustment and agency. Entrustment refers to the act of entrusting the property to another party for profit. Agency business refers to the daily business of a trust company. The principal grants its power to another party, and the other party acts as an agent to exercise the power management of the principal.

Basic characteristics of trust companies

1. Trust is based on mutual trust between principals, which requires the trustee to have a high degree of credibility;

2. The trustor will form a trust with the property that has been delivered to the trustee;

3. After the trust is concluded, the trust property will be separated from the client's account, no longer belonging to the client, but as property that can operate independently;

4. The trustee's purpose is to seek the maximum benefit for the beneficiary and conduct trust management.

These are the four basic characteristics of trust companies.