(Yicai Global) July 3 -- China’s largest broker Citic Securities and its closest competitor China Securities have both refuted a media report that claimed that the two peers have agreed on a merger that would create a USD82 billion financial behemoth.

The investment bank of Citic Group has not been informed about a possible consolidation, the Beijing-headquartered firm said in a statement yesterday. China Securities's shareholders have not told the company about such a plan, the Beijing-based brokerage said on the same day.

Since the beginning of this year, local media outlets have suggested that the pair, which already have close ties, intend to join forces. Bloomberg News reported yesterday, citing unidentified sources, that they have finally found an agreement.

One of the two has the other to thank for its existence. China Securities was founded in 2005 by Citic Securities and China Jianyin Investment to take over the business of Huaxia Securities. But in 2008, the China Securities Regulatory Commission stipulated that Citic Securities could only run one brokerage, prompting asset unloading.

By March, Citic Securities still had a 5 percent stake in China Securities, according to the target company's first-quarter earnings report. Moreover, Citic Group's unit Jinghu Holdings, which is Citic Securities's second-largest shareholder, held a 4.6 percent stake.

The two companies' stock prices have been rising amid heightened media attention.

Shares of China Securities [SHA: 601066] surged 6.11 percent to CNY46.01 (USD6.50) by lunchtime after touching an all-time high of CNY47.50 yesterday. The equity price has risen by half this year.

Citic Securities's stock price [SHA: 600030] climbed 2.42 percent to CNY26.69 (USD3.80) by noon. Its shares have climbed about 5 percent this year.

Editor: Emmi Laine