Since the strong supervision in 2020, the three businesses suspended by Jianghai securities have finally been restored recently.
Harbin Hatou Investment Co.Ltd(600864) recently announced that Jianghai securities, a wholly-owned subsidiary of the company, received a notice from Heilongjiang securities regulatory bureau to resume its asset management product filing and stock pledge business. Up to now, the three businesses of Jianghai securities limited by administrative regulatory measures, including bond self operation, asset management product filing and stock pledge, have been restored.
The reporter noted that since the decision of the CSRC to take restrictive measures against Jianghai securities in September 2020, the full recovery of Jianghai securities related businesses has taken about 18 months. During this period, Jianghai securities also officially replaced the new “leader” in January this year, and Jiang Baolin, the former vice president, took over Dong Lishen, who has reached the retirement age, as the president of the company.
three businesses have been suspended
According to public information, Jianghai securities, established in 2003, is the only state-owned holding securities company within the jurisdiction of Heilongjiang Province.
As of the first half of 2021, Jianghai securities has 76 branches, including 20 branches and 56 business departments, of which 32 business departments are located in Heilongjiang Province. Other branches are not only located in economically developed first tier cities such as Beijing, Shanghai and Shenzhen, but also in developed cities in Fujian, Liaoning, Shandong and other provinces.
The reporter learned that from 2016 to 2017, Jianghai securities frequently “stepped on thunder” in the stock pledge repurchase business, involving Tianguang Zhongmao (delisted) and other companies.
2020 September, Jianghai securities and related personnel received the decision on administrative supervision measures from the CSRC respectively. The CSRC found that Jianghai securities had the following problems:
First, in the process of bond investment trading, there are some problems, such as insufficient qualification management and trading behavior control of traders, inadequate management of underlying securities and counterparties, and insufficient effectiveness of compliance management and risk control;
Second, there are some problems in carrying out securities asset management business, such as illegal new channel business, chaotic internal management, inadequate risk management and so on;
Third, there are some problems in carrying out stock pledge business, such as business decision-making formality, insufficient due diligence, imperfect internal control and so on.
According to relevant regulations, the CSRC plans to take supervision and management measures for Jianghai securities to suspend the self operated bond business for 6 months, suspend the filing of asset management products for 6 months and suspend the stock pledge repo business for 6 months.
In addition, relevant executives of Jianghai securities related to the above businesses have also been subject to corresponding regulatory penalties among them, Rao Xihao, then vice president in charge of bond proprietary business of Jianghai securities, took supervision and management measures of inappropriate candidates and limiting relevant rights; Ge Xin, then the compliance director and chief risk officer, Jiang Baolin, then the vice president in charge of stock pledge business, and Kong Dezhi, then the vice president in charge of asset management business, were taken public condemnation and supervision and management measures to restrict relevant rights
Affected by the above events, in the classification results of securities companies in 2020, Jianghai securities decreased from BBB level to C level continuously, becoming one of the securities companies with the highest degradation rate in that year.
After the suspension of the three businesses for one year, Jianghai securities bond proprietary business took the lead in unsealing. On September 27, 2021, Harbin Hatou Investment Co.Ltd(600864) announced that Jianghai securities received the notice of Heilongjiang Securities Regulatory Bureau on resuming the self operated business of bonds and agreed to resume the self operated business of bonds. As of March this year, the three businesses of bond self operation, asset management product filing and stock pledge previously restricted by Jianghai securities have been restored.
related businesses are still “under pressure”
The suspension of the three businesses has formed great performance pressure on Jianghai securities Harbin Hatou Investment Co.Ltd(600864) 2020 annual report shows that Jianghai securities achieved a total operating revenue of 1.864 billion yuan in 2020, with a year-on-year increase of 19.64%; The net profit was 131 million yuan, a year-on-year decrease of 29.72%.
Due to the impact of regulation, the income of asset management business and proprietary business of Jianghai securities also decreased year-on-year. In 2020, the asset management business realized an operating revenue of 40 million yuan, a year-on-year decrease of 65.28%; The company’s self operated business realized an operating income of 522 million yuan, a year-on-year decrease of 8.15%.
According to the newly disclosed unaudited financial statements of the parent company of Jianghai securities in 2021, the total operating revenue of Jianghai securities in 2021 was 1.272 billion yuan, a year-on-year decrease of 26%; The net profit was 186 million yuan, a year-on-year increase of 210%. Specific to various businesses, in addition to the growth of brokerage business income, the income of investment banking, asset management and proprietary business is still declining.
In addition, it is worth noting that in January this year, when there are still two businesses that have not been restored, Jianghai securities officially changed the “head” of the company. Therefore, Jiang Baolin, the former vice president in charge of stock pledge business, took over Dong lichen, who has reached the retirement age, as the president and Deputy Secretary of the Party committee of the company.
According to public information, Jiang Baolin served as assistant to the president of Jianghai securities and general manager of Harbin Youyi Road Securities Business Department from June 2007 to September 2009, vice president of Jianghai securities from September 2009, and Harbin Hatou Investment Co.Ltd(600864) director from June 2020.
According to the ranking of operating performance indicators of securities companies published by the Securities Industry Association, in 2020, Jianghai securities ranked 54th in operating revenue, 74th in net profit, 57th and 52nd in total assets and net assets respectively.
