(Yicai Global) July 19 -- The asset management arm of Essence Securities has applied for a public fund management licence in China, becoming the fifth unit of a Chinese broker to do so this year.

The China Securities Regulatory Commission has accepted the application materials submitted by Essence Securities Asset Management, the watchdog said yesterday.

In May last year, China introduced a new regulation allowing financial institutions to apply for a second public offering license through a public fund management unit. Since January, the asset management units of China Merchants Securities, GF Securities, Industrial Securities, and Everbright Securities have applied and are all in the acceptance stage.

Guotai Junan Securities, which already had a public offering license, increased its stake in HuaAn Fund Management to 51 percent last October, becoming the first broker in the Chinese mainland to have two such permits.

Brokers and fund managers cooperate on research and agency sales, an analyst told Yicai Global. By applying for a public fund license, brokers can integrate their existing businesses with the public offering business, opening up the market and boosting revenue, the analyst noted.

Essence Securities Asset Management had revenue of CNY416 million (USD57.7 million) last year, accounting for 4.3 percent of its Shenzhen-based parent company’s total revenue. It had a total of 186 asset management products and about CNY136 billion under management as of Dec. 31.

Editors: Dou Shicong, Futura Costaglione