The industry concentration of the hottest securiti

2022-08-26
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The industry concentration of securities companies has accelerated.

under the construction environment of domestic multi-level capital market system, the development mode of institutional service business centered on trading is more abundant. Large securities companies have prominent competitive advantages in capital strength, risk pricing ability and institutional customer layout, and the industry concentration has accelerated.

recently, the China Securities Regulatory Commission announced the classification results of securities companies in 2019. Ten securities companies were rated as Class AA, and two securities companies were rated as class D. The brokerage industry is obviously polarized, and the competition pattern intensifies. "The strong will always be strong, and the winner will take all" is more obvious. The centralized and differentiated development of leading enterprises is an inevitable trend

28 securities companies' ratings decreased

according to the statistics of the classification results of securities companies in 2019, a total of 38 securities companies were rated as class A, 2 less than last year, accounting for 38.8%; Among the 38 class a securities companies, 10 securities companies were rated as class a AA, 2 less than last year; There are 50 class B securities companies, one more than last year, accounting for 51%; Among them, there are 28 BBB level securities companies, one less than last year, 12 BB level securities companies, three less than last year, and 10 B-level securities companies, five more than last year; Eight securities companies were rated as class C; Two were rated as class D. Compared with 2018, the ratings of 19 companies were upgraded, 28 companies were downgraded, and 51 securities companies remained unchanged

in order to achieve a faster degradation rate among the 28 securities companies whose classification rating results have been downgraded, Guorong securities has the largest range. The classification rating of the company has been directly reduced by 5 levels to level C from BBB last year; Followed by Dongguan securities and Changjiang Securities, Dongguan securities was lowered by 3 levels, Dongguan securities was lowered from a level to B level, and Changjiang Securities was lowered from BBB level to CCC level

after Huaxin securities became the first D-class securities company since the implementation of classified supervision by securities companies last year, another D-class securities company was added this year - credit securities. Credit securities' rating was lowered from CCC to d

on November 20 last year, due to the 24 minute interruption of the centralized trading system of China Securities and the delayed reporting, Liaoning Securities Regulatory Bureau issued a warning letter to China Securities, requiring the company to strengthen the security of information system and improve the event reporting mechanism. On March 6 this year, liao1 Before the installation of the experimental machine, Nanjing Securities Regulatory Bureau took the decision to order the securities to make corrections and regularly report the regulatory measures

according to the regulations on the classification and supervision of securities companies, securities companies are divided into 5 categories and 11 levels, including a, B, C, D and e pressure testing machines equipped with booster pump components. A. Companies at all levels in the three categories B and C are normal operating companies, and their categories and levels only reflect the relative level of the company's risk management ability and compliance management level in the industry. Class D and class E companies are companies whose potential risks may exceed the company's tolerable range and are subject to risk disposal measures in accordance with the law

large securities companies have outstanding advantages

it is worth noting that the AAA rating, the highest rating this year, is still vacant. In general, the industry phenomenon of "the strong are always strong, and the winners take all" is vividly reflected in the classification results

according to Yang Ouwen, head of the financial products team of Chuancai securities, this is mainly due to financial markets and regulatory policies. From the perspective of market environment, the stock market has been inactive in recent years. For securities companies whose main income is brokerage business, the income increment is limited, and the competition among securities companies tends to be white hot. Large securities companies have comparative advantages in capital strength and business ability, and have strong competitive advantages in the newly developed securities interconnection business and science and technology innovation board business, resulting in further improvement of industry concentration

"At present, the idea of classified supervision of securities companies is clear. On the one hand, it is more difficult for small and medium-sized securities companies to improve the rating by carrying out assessment and rating on the risk management, business income, new business competitiveness and information system construction investment of securities companies through the classification and rating of securities companies; on the other hand, it is more open to the outside world and allows domestic securities companies to set up audits, and further increases the industry competition through the introduction of high-quality funds, so as to improve the service entity economy of the securities industry Economic capacity, which has further accelerated the '28 differentiation' of securities companies. " Yang Ouwen said

experts predict that under the influence of classified supervision and financial supply side structural reform, the business concentration of securities companies will further increase in 2019, the leading effect of large securities companies will gather, and small and medium-sized securities companies will develop differently, forming their own business characteristics

from the perspective of the competition pattern, in April 2018, the measures for the administration of foreign-invested securities companies whose weight is only comparable to that of a small car allowed foreign investors to control joint-venture securities companies, and UBS immediately increased its shareholding in UBS Securities from 24.99% to 51%. Subsequently, JPMorgan Chase and Nomura holdings submitted an application for the establishment of a new securities company. In March 2019, JPMorgan securities China Co., Ltd. and Nomura Orient International Securities Co., Ltd. were approved by the CSRC. In July 2019, the approval for the establishment of domestic securities companies was restarted

"this is conducive to introducing high-quality domestic shareholders and promoting full competition in the securities industry. At this point in time, the securities industry can get better development by returning to its roots and serving the real economy." Yang Ouwen said

Wang Jian, an analyst at Guosen Securities, believes that the concept of industry classification supervision is becoming clearer and clearer, and the centralized and differentiated development of leading enterprises is an inevitable trend. Under the construction environment of domestic multi-level capital market system, the development mode of institutional service business centered on trading is more abundant. Large securities companies have prominent competitive advantages in capital strength, risk pricing ability and institutional customer layout, and the industry concentration is accelerated

Wang Jian believes that due to the pilot business, the business is related to capital strength, rating, etc., the regulatory resources tend to be leading securities companies, and the industry concentration continues to increase. Industry classification regulation and the acceleration of financial opening up will guide the differentiated development of the industry. It is expected that more small and medium-sized securities companies will go out of the characteristic development path in the future. Among them, some small and medium-sized securities companies can take advantage of their competitiveness in a certain field to form their own business characteristics, including research ability, investment and trading ability, financial technology ability, cost management ability, etc

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