Securities industry in China

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Securities industry in China is an article on the securities industry in mainland China.

Contents

History

Regulation

In mainland China, the China Securities Regulatory Commission is the primary regulator; however, it has delegated certain activities to a self-regulatory organization called the Securities Association of China (SAC).

Mainland China began an IPO sponsor system began in 2004, which is similar to a sponsor system in Hong Kong began in 1999. [4] In order to be publicly listed in China, a prospective listing firm must be sponsored by a securities company (investment bank) and the sponsor must assign sponsor representatives to the listing firm. [5] This In 2012, the SAC took over registration of sponsor representatives. The exam to become a sponsor representative is extremely difficult, with a one percent passing rate, [4] and sponsor representatives have been highly compensated, with $1 million annual salaries in 2010. Despite this, they are viewed as often ineffective. [4]

Equity share types and foreign investment

Mainland shares are known as A-shares and are not typically available for purchase by foreigners. B-shares are available to foreigners, but are reputed to be more risky as they are available for less desirable companies. H-shares are for mainland China companies which are traded on the Hong Kong Stock Exchange.

Institutional investors can apply to become Qualified Foreign Institutional Investors (a program which began in 2002) and then are allowed to buy A-shares; the minimum assets under management was reduced from $5 billion to $500 million in 2012. [6]

On 10 November 2017, China allowed foreign participation up to 51% in securities ventures. [7]

On March 13, 2020, the Securities Regulatory Commission announced that the restriction on foreign shareholding ratio of securities companies will be abolished from April 1, 2020, and qualified foreign investors may submit applications for the establishment of securities companies or change of the actual controller of the companies in accordance with the requirements of laws and regulations, relevant regulations of the SFC and relevant service guidelines in accordance with the law. In the presence of the huge Chinese market, foreign-owned brokerage firms are coming in droves.

Securities companies classification

The China Securities Regulatory Commission in 2021 has classified securities companies as the following: [8]

AA

A

  • AVIC Securities
  • BOC International
  • Beijing Gaohua
  • Caida Securities
  • Caitong Securities
  • Capital Securities
  • CDB Securities
  • Changjiang Securities
  • Credit Suisse Founder
  • Dongguan Securities
  • Dongxing Securities
  • Eastern Fortune
  • Founder Securities
  • Great Wall Securities
  • Guoyuan Securities
  • Huaan Securities
  • Huachuang Securities
  • Hualin Securities
  • Huaxin Securities
  • Minmetals Securities
  • Nanjing Securities
  • Open Source Securities
  • Shanxi Securities
  • Sinolink Securities
  • Soochow Securities
  • Southwest Securities
  • Tianfeng Securities
  • Tokai Securities
  • UBS Securities, China Branch
  • Warburg Securities
  • West China Securities
  • Western Securities
  • Zheshang Securities
  • Zhongtai Securities
  • Zhongtian Guofu

BBB

  • Bohai Securities
  • Caixin Securities
  • Central China Securities
  • Cinda Securities
  • Fed Securities
  • Gold Dollar Securities
  • Goldman Sachs Gao Hua
  • Great Wall Guorui
  • Guohai Securities
  • Haitong Securities
  • HSBC Qianhai
  • Huajin Securities
  • Hualong Securities
  • Huaxing Securities
  • Morgan Stanley Huaxin
  • Northeast Securities
  • Shengang Securities
  • Zhongtian Securities

BB

  • Century Securities
  • Datong Securities
  • East Asia Qianhai
  • First Capital Securities
  • Guolian Securities
  • Guorong Securities
  • Hongta Securities
  • Huafu Securities
  • Intime Securities
  • Kyushu Securities
  • Minsheng Securities
  • Wanlian Securities
  • Xiangcai Securities
  • Yingda Securities
  • Yongxing Securities
  • Yuekai Securities

CCC

  • Aijian Securities
  • Chase Securities
  • China Post Securities
  • Guosheng Securities
  • Hengtai Securities
  • Horizon Securities
  • Huarong Securities
  • Jianghai Securities
  • New Era Securities
  • Pacific Securities
  • Zhongshan Securities

CC

  • Guodu Securities

C

  • Chuancai Securities

D

  • N-Securities

Rankings

Data as of March 31, 2017

RankingCompanyTotal Assets

(RMB 1B)

Total Revenue

(RMB 1B)

Net Profit

(RMB 1B)

1 CITIC Securities 624.588.462.43
2 Haitong Securities 559.056.852.59
3 Guotai Junan Securities 390.735.972.77
4 Huatai Securities 382.253.781.37
5 GF Securities 354.944.942.22
6China Merchant Securities242.942.831.38
7 China Galaxy Securities 234.921.651.13
8 Orient Securities 203.792.410.87
9 Guosen Securities 185.092.631.04
10Founder Securities149.591.320.41

Source: S&P Global [9]

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References

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  3. "中国证券业发展现状点评_花树_新浪博客". Blog.sina.com.cn. 2010-08-23. Retrieved 2012-08-04.
  4. 1 2 3 Changxin G. (2011). Lack of due diligence makes it difficult for traders to take stock. Chinadaily.
  5. [CSRC Decree No.58]: Administrative Measures on Sponsorship for Securities Issuance and Listing Archived 2011-11-28 at the Wayback Machine . China Securities Regulatory Commission.
  6. New Chinese policy may favor big foreign investors. Pensions & Investments.
  7. "China Makes Historic Move to Open Market for Financial Firms". Bloomberg.com. 10 November 2017.
  8. "中国证监会公布2021年证券公司分类结果_天津监管局". www.csrc.gov.cn. Retrieved 2022-09-17.
  9. Garrido, Francis (4 July 2017). "CITIC Securities, Haitong Securities top China broker/dealer asset rankings". S&P Global.