--- title: "A fund company's \"settlement\" may affect annual profits?" type: "News" locale: "en" url: "https://longbridge.com/en/news/276759018.md" description: "SDIC UBS Fund Management Co., Ltd. announced a special \"settlement\" for individual investors who confirmed their redemptions, which may have a negative impact on SDIC Capital's net profit attributable to the parent company for the year 2026, with an estimated impact amount of less than 5%, approximately 135 million yuan. The overall expenditure of SDIC Capital is expected to not exceed 432 million yuan" datetime: "2026-02-24T15:27:42.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/276759018.md) - [en](https://longbridge.com/en/news/276759018.md) - [zh-HK](https://longbridge.com/zh-HK/news/276759018.md) --- # A fund company's "settlement" may affect annual profits? SDIC UBS Silver LOF is still attracting more attention. During the Spring Festival holiday, SDIC UBS published an announcement titled "**Announcement on the Silver Fund Related Plan by SDIC UBS Fund Management Co., Ltd.**" on its official account, announcing a special "settlement" for individual investors who confirmed redemptions on February 2. On the last night before returning to work after the Spring Festival holiday, SDIC Capital, the "indirect shareholder" (shareholder of the shareholder) of SDIC UBS, announced the potential impact of the aforementioned work plan on the company's performance (see the image below). This unveiled further "details" and "progress" of the SDIC UBS Silver LOF incident. ## **Impact of SDIC Capital's Announcement** The main content of the announcement released by SDIC Capital includes the following: Recently, the valuation adjustment of the SDIC UBS Silver Futures Securities Investment Fund (LOF), a subsidiary of SDIC Capital's third-level holding investment enterprise, has attracted market attention. SDIC UBS Fund has released a special work plan regarding this matter on February 15, 2026. According to the relevant provisions of the "Shanghai Stock Exchange Stock Listing Rules," it is necessary to disclose relevant situations and their impact on SDIC Capital in a timely manner, hence the announcement. Furthermore, preliminary calculations indicate that the current work plan of SDIC UBS is expected to have a certain negative impact on SDIC Capital's net profit attributable to the parent company for the year 2026, **with the impact amount being less than 5% of SDIC Capital's audited net profit attributable to the parent company for the year 2024, and it will not have a substantial impact on the overall business development of the company.** ## **What is the upper limit of the impact?** So, what is the actual impact? Specific data has not been disclosed, but based on the annual report data of SDIC Capital for 2024 as a reference, the net profit attributable to the parent company for SDIC Capital in 2024 is 2.694 billion yuan. Thus, the announcement confirms that the "settlement" plan of SDIC UBS Silver LOF is expected to have an **impact of no more than 135 million yuan on SDIC Capital's net profit attributable to the parent company.** However, considering that SDIC UBS is a "third-level subsidiary" of SDIC Capital (i.e., a great-grandchild company), where SDIC Capital holds 100% of SDIC Capital Holdings Co., Ltd., which in turn holds 61.3% of SDIC Taikang Trust, and SDIC Taikang Trust holds 51% of SDIC UBS Fund (see the image below). If this impact is calculated based on the penetrated shareholding ratio, it can be deduced that **SDIC Capital estimates that the overall expenditure of the SDIC UBS plan will not exceed 432 million yuan.** ## **Will the "upper limit" of the plan exceed the annual profit of the fund company?** In addition, according to the disclosure information in SDIC Capital's 2024 annual report, **Guotou Ruijin achieved a net profit of 376 million yuan in 2024.** **After "penetration," Guotou Ruijin's annual profit accounts for approximately 3.69% of SDIC Capital's net profit attributable to shareholders** (see the chart below, source: SDIC Capital Co., Ltd. 2024 Annual Report). Based on this, **the estimated expenditure cap for the shareholders of Guotou Ruijin for this work plan does not exceed 1.36 times Guotou Ruijin's net profit for 2024.** ## **"Detailed Explanation" of the Silver Fund Work Plan** Looking back, Guotou Ruijin's "record-breaking" work plan still has many "innovations" and "work details" that have no precedent in the industry. First, the fund manager reiterated in the announcement that the valuation adjustment made on the evening of February 2 was influenced by the recent historic extreme fluctuations in the silver market. This decision was made to treat all investors fairly and avoid "first redemption advantage." However, considering the valuation adjustment for the silver LOF, the related announcement has drawn significant attention from investors. "In response to everyone's concerns, we have always actively responded with the most urgent mindset and worked hard to address everyone's demands, coordinating and deploying various tasks promptly and working day and night to formulate a special work plan." Secondly, Guotou Ruijin stated that **this plan was formulated following the principles of stratification and classification, convenience, and reliability** to maximize the protection of investors' legal rights and interests, especially for small and medium-sized investors. The plan **applies to** natural person investors of the Guotou Ruijin Silver Futures Securities Investment Fund (LOF) who confirm redemption based on the net value as of February 2, 2026 (including redemption applications submitted after 3 PM on January 30, 2026, and before 3 PM on February 2, 2026), excluding institutional investors. Thirdly, the specific plan also distinguishes the "settlement" ratio for natural person investors based on different redemption amounts: For natural person investors with an **impact amount** from the valuation adjustment (from -17% to -31.5%) **below 1,000 yuan, the settlement amount is determined in full based on the actual impact amount** (this group of investors accounts for over 90% of the redeeming investors on that day). For natural person investors with an **impact amount** (from -17% to -31.5%) **exceeding 1,000 yuan (inclusive), the total settlement amount is determined by adding the base of 1,000 yuan plus a certain proportion of the amount exceeding 1,000 yuan.** Fourth, individual investors who meet the above criteria can search for the "SDIC UBS Silver Fund" mini-program on Alipay, complete identity verification as prompted, and handle related matters online according to the guidelines. Due to the large number of investors involved and the significant workload, in order to ensure that investor demands are addressed conveniently and reliably, SDIC UBS is making every effort to advance the technical support preparations. **The relevant mini-program will officially launch on February 26, 2026.** In addition, the announcement indicates that since the relevant mini-program is on Alipay, the company has not only announced a dedicated hotline for mini-program usage inquiries but also provided a hotline for customers who do not have Alipay. ## **There is still much "hot discussion" and "impact"** The working plan for the SDIC Silver LOF is a **breakthrough institutional arrangement in the industry regarding the controversy caused by fund companies adjusting valuations, which can be said to set a record in the industry.** Following the announcement of this working plan, discussions and heated debates in the industry are expected to continue for a long time. Firstly, this plan originated from the fund company's arrangements for adjusting the valuation of fund products, which again reminds **fund companies to prudently determine the adjustment plan for fund valuations, especially regarding the timing of the announcement and the details of the specific arrangements.** Secondly, this plan arose from the historic volatility in silver prices, which also reminds **fund companies to prudently create and meticulously design contracts for fund products linked to commodities and futures, and to adequately prepare for the potential significant fluctuations of related products.** Thirdly, the fund products involved in this plan have both over-the-counter and on-exchange trading scenarios, each exhibiting unique volatility characteristics. Such products impose high professional requirements on **fund companies in terms of product plan design, risk management responses, compliance and supervision, information disclosure, and external communication.** These requirements are systematic, comprehensive, progressive, and subject to continuous iteration. Fourthly, it is believed that after the release of the specific working plan, different categories of investors may have their own demands and thoughts, such as why institutional investors are not included in the scope of this working plan, and why the boundary for full "settlement" is set at 1,000 yuan, etc. This may require rational communication and handling from all parties involved. In summary, although this event is not over, it offers many insights for the industry, and one important takeaway is: A public fund product cannot simply grow naturally once it is established; rather, it requires the manager, sales parties, and all relevant parties to be fully engaged in continuous improvement and refinement. At the same time, a public fund product cannot be perfect from its inception; it will become better through refinement and improvement over more time and space. Risk Warning and Disclaimer The market has risks, and investment should be cautious. This article does not constitute personal investment advice and does not take into account the specific investment goals, financial conditions, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article align with their specific circumstances. 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