Source of this article: Times Weekly Author: Lei Chen
The era of reshaping the pattern of the securities industry is coming.
Beijing Local Financial Supervision and Administration Bureau latest information shows that on June 10, Daiwa Securities (China) officially obtained the "Securities and Futures Business License" issued by CSRC , indicating that it can officially conduct business externally. The business scope includes securities brokerage, securities underwriting and sponsorship, and securities proprietary operation.
As the only Japanese securities company in China with an investment bank license, is Yamato Securities (China) another catfish that stirs up the domestic securities industry?
Recently, a relevant person in charge of the Directors and Office of the Daiwa Securities (China) said in an interview with a reporter from Times Weekly that the company will focus on the two major features of "cross-border + focus" (focusing on institutional customers and key industries such as consumption, medical care, and high-end manufacturing), especially in providing customers with cross-border asset allocation and other businesses.
is not just Yamato Securities (China). A week ago, DBS Group also announced that its joint venture securities company, DBS Securities (China) Co., Ltd. (hereinafter referred to as DBS Securities), was also approved by the China Securities Regulatory Commission and can officially conduct business to the outside world.
According to the Times Weekly reporter, the CSRC has approved and approved 8 foreign-controlled securities companies, including UBS Securities , Goldman Sachs Gaohua Securities, Credit Suisse Founder Securities , and Morgan Stanley Huaxin Securities are foreign shareholders who have achieved control by increasing their shareholding ratio. The newly established foreign-controlled securities companies include DBS Securities, Daiwa Securities, JPMorgan Securities and Nomura Oriental International Securities. In addition, foreign securities firms are queuing up to enter the Chinese market.
In the industry's view, foreign securities firms still have difficulties such as insufficient capital and weak customer base in China's localization process. However, they have long-term and rich experience in compliance awareness, innovative business capabilities and business management models, and are expected to produce the " catfish effect " in China, forcing the entire industry to transform and upgrade.
The team of foreign-controlled securities companies has grown
From the time of application to the business development, Daiwa Securities (China) took less than 21 months.
Public information shows that on September 24, 2019, the company's establishment application was accepted by the China Securities Regulatory Commission; at the end of August 2020, the China Securities Regulatory Commission approved the establishment; on December 18 of the same year, the company officially obtained a business license.
Day Eye Check shows that at present, the chairman of Daiwa Securities (China) is Xian Chuping, and the legal representative is Geng Xin, general manager. In terms of equity structure, the three shareholders of the company are Daiwa Securities Group Corporation (shareholding ratio 51%), Beijing State-owned Capital Management Center (shareholding ratio 33%), and Beijing Xicheng Capital Holdings Co., Ltd. (shareholding ratio 16%).
Its Japanese shareholder Yamato Securities Group Corporation was founded in 1902 and is headquartered in Tokyo. It is the only securities company among the five major securities companies in Japan that integrates brokerage business and online banking business . Daiwa Securities Group first entered mainland China in 1983, successively established representative offices in Beijing and Shanghai, and actively participated in the IPO of H shares of multiple domestic companies.
Recently, President Seiji Nakata, the head of the Yamato Securities Group Corporation, said in an interview with the media that as Asia's largest economy, China's development potential is unquestionable, and the development prospects of the securities industry are still broad. Daiwa Securities Group will continue to leverage its global talent and network advantages, and use "cross-border" business as the core to expand its investment and financing services, transactions, mergers and acquisitions in China.
Times Weekly reporter learned from Yamato Securities (China) that the company currently has nearly 100 employees in China.
is not much of its peers in this scale. According to data from Oriental Fortune Choice, as of June 12, judging from the number of employees of 129 securities companies (including subsidiaries) that have data to check, 5 have less than 100 people, including Huaxin Securities , Jintong Securities, Ningzheng Asset Management, Goldman Sachs Gaohua Securities and Anxin Asset Management, with the number of people being 1, 6, 38, 71 and 94 respectively.
In addition, a reporter from Times Weekly browsed the recruitment website and found that Yamato Securities (China) is "recruiting troops" and locked in recruiting multiple positions such as liquidation positions, traders, audit managers, legal managers, etc.
Daiwa Securities (China) told the Times Weekly reporter, "Currently, staffing allocation can meet the company's early needs in the business development. However, according to the company's development plan after the business development needs to be continuously optimized and supplemented, and outstanding talents will continue to be recruited through various channels." Zhang Liwen, director of the Criminal Litigation Legal Affairs Department of Jingshi Law Firm, told the Times Weekly reporter that foreign securities companies represented by Daiwa Securities enter China is an important symbol of the development of China's investment banking business.
Currently, there are 8 foreign-controlled securities companies approved by the China Securities Regulatory Commission, and foreign capital waiting to enter the Chinese market is everywhere. Information from the China Securities Regulatory Commission on April 27 showed that the "Securities Company Establishment Approval" materials submitted by BNP Paribas were received, which is a leading global bank and financial service institution in Europe. In addition, Standard Chartered Bank (Hong Kong) Co., Ltd. and the securities companies planned to be established by Warburg Pincus Investment in the United States are under review.
Zhang Liwen believes that compared with countries around the world, my country's investment banking business started late. Now is the beginning of the IPO registration system . After foreign investment banks enter, they will surely promote the standardization of my country's listing sponsorship work, thereby optimizing and improving the substantive quality of listed companies. This is a positive trend that matches the registration system . The entire process from sponsorship to listing will have a market choice of survival of the fittest, which will play an important role in promoting the maturity of China's capital market.
The era of mergers and reorganization will not be too far
Beijing Kandong Research Institute researcher Wang Chikun told the Times Weekly reporter that after years of development, local securities companies have shown a high degree of marketization, but the market flexibility is slightly insufficient. Foreign-funded securities operations are more mature than domestic securities companies and have obvious operating advantages. The entry of foreign securities firms will inevitably change the competitive landscape of the industry.
In order to implement the new Securities Law and improve the equity supervision of securities companies, on March 19, the China Securities Regulatory Commission issued the "Decision on Amendment" and the "Decision on Amendment", which will come into effect on April 18, 2021.
In this regard, Wang Chikun said that the regulation has made adjustments to shareholder institutions and shareholder backgrounds, which means that the approval of the establishment and change of securities companies is relaxed. Policy adjustment + the market needs to lower the entry threshold for securities companies, which will promote industry changes.
Wang Chikun pointed out that my country's securities industry has entered a mature stage as a whole, and the dividends of industry development have disappeared. Due to the liquidity of the financial market and the high chance of capital markets, the securities industry is an industry that requires highly flexible, high-frequency and high-strength changes.
"At the same time, the development of technologies such as the Internet, big data, artificial intelligence will change the advantages of securities companies at any time. If the change cannot be grasped, the advantages of securities companies that win will disappear soon." Wang Chikun said that some local state-owned assets have no advantages in terms of financial strength, talent attraction, market flexibility, etc., and may be the first to be unacceptable, and some securities companies may even be eliminated.
As competition in the securities industry intensifies, in order to promote high-quality development of the industry, the China Securities Regulatory Commission announced the first whitelist of securities companies on May 28.
For companies included in the whitelist, the CSRC not only greatly simplifies the process of obtaining regulatory opinions, but also stipulates that only whitelist companies can apply for innovative pilot businesses. In addition, the China Securities Regulatory Commission will gradually include more regulatory matters in management in the future and concentrate limited regulatory resources in key areas.
According to the Times Weekly reporter, the first batch of whitelists involve 29 companies, including not only large securities companies such as CITIC Securities , CITIC Construction Investment , CICC , Guotai Junan , as well as small and medium-sized securities companies such as AVIC Securities , and Huabao Securities, but also foreign securities companies such as Beijing Gaohua, Goldman Sachs Gaohua, UBS Securities.
Huafu Securities research report believes that whitelist securities companies will have more first-mover advantages in future industry competition. The whitelist will directly affect the cultivation of securities companies' future competitiveness, and it is expected to consolidate the main responsibility of securities companies for internal control and compliance, and force the industry to develop at a high quality level.
Wang Chikun said that when the industry dividends disappear and the market competition is very fierce, everyone is fighting in a limited stock market, one is rising and the other is falling. Operation alone is no longer able to promote the growth of main business. Securities companies are competing at the strategic level, with diversified technology iteration, diversified entrepreneurship and diversified mergers and acquisitions. "The era of mergers and reorganizations in the securities industry will not be too far away."
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