BEIJING, Sept 18 (Reuters) - The involvement of two Chinese state-owned financial firms in Zhongrong International Trust Co's operations and management may diffuse risk at the troubled shadow bank but does little to ease concerns about missed payments, analysts and investors said.
It was not immediately clear whether the support by the two firms was engineered by the Chinese authorities, but Beijing has previously bailed out troubled financial firms by roping in state entities to contain broader contagion risk.
The agreement allows the two financial firms to "provide professional services for operations and management" of Zhongrong, it said, adding the move would not impact its debt ownership and legal relationship in trust products.
That would further dampen investors' confidence in trust products."
"It's good news and at least provides some clarity," said Zhang, who is an investor in a Zhongrong trust product and gave only his surname due to sensitivity of the matter.
Persons:
Zhongrong, They'll, Zhang, Xu, I've, Ziyi Tang, Ryan Woo, Sumeet Chatterjee
Organizations:
Trust, Citic Trust, CCB, Citic Group, China Construction Bank, National Financial Regulatory Administration, People's Bank of China, Citic, Shanghai, Thomson
Locations:
BEIJING, Beijing