China's Top Two Brokers Debunk Merger Rumors Again
Xu Wei
DATE:  Aug 07 2020
/ SOURCE:  Yicai
China's Top Two Brokers Debunk Merger Rumors Again China's Top Two Brokers Debunk Merger Rumors Again

(Yicai Global) Aug. 7 -- CSC Financial and Citic Securities, China’s two leading brokerage firms, again refuted speculation that they plan to combine into one giant financial company. This is the fifth time in four months that such a rumor has circulated.

The latest spread via social media yesterday -- a claim that Wang Changqing, chairman of CSC Financial, which trades as China Securities, was to be named deputy general manager of Citic Securities. There was even conjecture that a union of the pair would be announced the same day.

In a statement, China Securities said reports of a merger and management change were all false, and the company had not hidden any information it is bound to disclose. This is the third time that the broker has publicly responded to such gossip. 

Shares of China Securities [SHA:601066] closed 3.6 percent higher today at CNY54.67 (USD7.84) each, while Citic Securities [SHA:600030] was little changed at CNY31.96. At one point yesterday, China Securities jumped 9.2 percent, while Citic rose more than 7 percent.

The companies, both headquartered in Beijing, are closely connected. China Securities was co-funded by Shenzhen-based Citic and China Jianyin Investment in 2005. Citic gradually withdrew from it after regulatory policy changes mandated that in 2008, but still owns 5.01 percent of China Securities, according to its first quarter financial report.

Citic Securities had more than CNY791.7 billion (USD112.1 billion) of assets under management at the end of last year, a 21 percent increase from 2018. Net profit jumped 30 percent to CNY12.2 billion (USD1.7 billion) on a 15.9 percent gain in revenue to CNY43.1 billion. Its biggest shareholder, Citic Group, has a 16.5 percent stake.

Assets under management at China Securities rose 46 percent to CNY285.7 billion last year. Net profit leapt 78 percent to CNY5.5 billion on CNY13.7 billion in revenue, a 24 percent rise. The company is controlled by Beijing’s state-owned assets commission, which owns 35 percent.

Editor: Ben Armour

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Keywords:   China Securities,CITIC Securities