In 2021, the annual net profit of China Securities Co.Ltd(601066) securities exceeded 10 billion yuan for the first time. Looking forward to the future, how to meet the comprehensive registration system? How to seize the blue ocean of wealth management? How to develop derivatives business?
On April 8, China Securities Co.Ltd(601066) securities 2021 annual performance presentation was held at the China Securities roadshow center Wang Changqing, Secretary of the Party committee and chairman of China Securities Co.Ltd(601066) securities, Li Geping, general manager and financial director of China Securities Co.Ltd(601066) securities, Wang Guangxue, member of China Securities Co.Ltd(601066) securities Executive Committee and Secretary of the board of directors, China Securities Co.Ltd(601066) securities employee supervisor, administrative director of planning and finance department, and Zhao Ming, administrative director of capital operation Department replied to the above questions one by oneP align = “center” four businesses helped net profit exceed 10 billion yuan for the first time
“2021 is the 100th anniversary of the founding of the party and the opening year of the 14th five year plan. In this year, China Securities Co.Ltd(601066) securities made great progress. On the basis of the best operating performance in 2020, 2021 set a new historical record again, and the net profit attributable to the parent company exceeded RMB 10 billion for the first time.” Wang Changqing said at the performance presentation meeting.
Li Geping believes that the growth of the company’s net profit in 2021 mainly comes from the contribution of wealth management, fixed income trading, derivatives trading and follow-up investment on the science and innovation board.
Specifically, in the wealth management sector of the company, a number of business indicators such as brokerage business and two financing business continue to be among the best in the industry and have achieved significant growth. The fixed income trading business continued to maintain a stable trading style, better grasped the bond market, and achieved a significant increase year-on-year; While steadily promoting the existing business, the derivatives trading business has actively arranged cross-border business, effectively meeting the business needs of domestic and foreign institutional customers, and the revenue has also increased significantly year-on-year; In addition, adhering to the concept of serving the real economy, scientific and technological innovation and economic transformation, the company completed 12 follow-up investment projects on the science and innovation board in 2021, with the scale of follow-up investment reaching 465 million yuan, and the follow-up investment income increased by 173% year-on-yearP align = “center” three aspects of deployment to meet the comprehensive registration system reform
“Comprehensively promoting the reform of the registration system is a very important goal for the development of the capital market in the coming period.” Wang Changqing said that the registration system takes information disclosure as the core and gives the option of listing to the market. In this process, the responsibility of “gatekeeper” of capital market undertaken by investment banks is becoming more and more important.
In the face of the upcoming comprehensive registration system reform, China Securities Co.Ltd(601066) securities attaches great importance to and makes careful arrangements.
According to Wang Changqing, the company’s key plan starts from three aspects. First, strengthen the project establishment and control the project quality from the source. The whole investment banking business should serve the national strategy and the real economy, adhere to the original intention, be based on the development plan of the national industry, and firmly layout strategic emerging industries, high-tech enterprises and specialized and special new enterprises, which is the direction set from the perspective of project establishment and customer selection. At the same time, the whole investment banking business should optimize the project management, introduce industry experts and industry research within the investment banking commission, and focus on selecting and judging the projects of listed companies from the aspects of industry orientation, industry prospect and enterprise competitive advantage.
The second is to strengthen quality control and comprehensively improve the practice quality. The core is to improve the quality control of the whole process of investment banking business, adhere to the three lines of defense of quality control, and the quality control department should participate in the project management from the beginning of project approval.
Third, effectively improve the service quality and provide customers with high-quality comprehensive financial services.
” China Securities Co.Ltd(601066) securities investment bank put forward a service concept that is to make the best enterprise become our customers and our customers become better enterprises.” Wang Changqing stressed that the company is committed to providing customers with comprehensive services of full cycle, all-round and all-round products, establishing a business coordination system. At the same time, it also has a strict assessment system to improve customer service from the original narrow investment banking service to all-round services such as investment banking, wealth management institutions and research and development, so as to jointly provide customers with high-quality comprehensive servicesP align = “center” seize the blue ocean market of wealth management with incremental thinking
In Li Geping’s view, the transformation of wealth management business is very important for the future development of securities companies. In 2021, the company’s wealth management business proposed to seize the blue ocean market of wealth management with incremental thinking, vigorously invest resources, make use of high-quality products and services, and continuously expand the number of customers and asset scale.
According to Li Geping, the strength of China Securities Co.Ltd(601066) securities in wealth management business is mainly reflected in three aspects: first, enrich the product system, strive to build a good reputation of China Securities Co.Ltd(601066) and cover the whole market with high-quality companies and top private placement to meet the diversified needs of customers; Second, improve the service system, continue to build the product sales service system, deepen the product investment, education and training, enrich the marketing materials and publicity methods, strengthen the after-sales service, and actively promote the coordination with the financial system subsidiary of CITIC Group, so as to greatly improve the sales volume and retention scale of various products. Third, improve the investment and research system. On the one hand, with the help of in-depth research and professional evaluation, ensure the supply quality of products and provide professional services for salespeople; On the other hand, integrate the product system and customer system, realize the transformation from product-centered to customer-centered, and improve the comprehensive strength of investment research and asset allocation.
“In addition, the company actively recruits professionals for the whole society, strives to build an iron army of wealth management and enhance the core competitiveness of wealth management business.” Li Geping saidP align = “center” ensure the rapid and steady development of derivatives business
Turning to the derivatives business, Zhao Ming said that the company’s derivatives business achieved remarkable results in 2021, which not only increased the new scale of OTC option business, but also enriched the product structure and application scenarios.
According to Zhao Ming, China Securities Co.Ltd(601066) securities added 343.4 billion yuan to its OTC option business in 2021, an increase of 39%; The new scale of income swap was 103 billion yuan, an increase of 151%.
Zhao Ming said that in 2022, the company will continue to focus on customers in derivatives business, improve product supply and comprehensive service ecology, and continuously improve trading and risk control capabilities. In terms of overseas derivatives, we should increase investment, promote innovation, strive to cover the international mainstream market and provide customers with cross time zone derivatives trading services in the global market.
Zhao Ming revealed that China Securities Co.Ltd(601066) securities has been studying plans suitable for its own development status in view of the decline of corresponding capital indicators. “In fact, last year, the company successively increased the supplement to subsidiary capital by issuing subordinated bonds and sustainable subordinated bonds, and has been actively planning for equity refinancing.” Zhao Ming said.
Zhao Ming further said that before equity financing is in place, China Securities Co.Ltd(601066) securities will improve the efficiency and efficiency of capital use by optimizing asset liability management. At the same time, take forward-looking and refined measures to always do a good job in liquidity risk management to ensure the rapid and steady development of derivatives businessP align = “center” go all out to do a good job in the company’s operation
At the performance presentation meeting, some investors mentioned the poor performance of the company’s share price. In this regard, Wang Guangxue said that from the latest industry average Pb, the dynamic Pb of the securities sector is about 1.2-1.4 times, returning to the low valuation, which does not match the actual situation of the continuous growth of the performance of the head securities companies. In theory, there should be upward correction expectations.
“From the perspective of China Securities Co.Ltd(601066) securities itself, the biggest highlight is that the roe level of the company has been maintained at the highest level of the head securities companies. In 2021, the roe of the company was close to 16%, twice the average level of the industry. The investment banking business has always been relatively leading, and all stock and bond mergers and acquisitions are among the best.” Wang Guangxue said, “any listed company, including China Securities Co.Ltd(601066) securities, is in awe of the capital market. We should try our best to do well in business and lay a good foundation for the company’s good basic transactions, so as to truly deserve trust and support. This is the duty that every listed company should adhere to, but the stock price is also an unavoidable problem.” Wang Guangxue said.
In addition to doing a good job in the company’s operation, Wang Changqing said that in the past year, China Securities Co.Ltd(601066) securities has actively fulfilled the mission of state-owned financial enterprises and continued to experience and grow in serving the national strategy, the real economy and the financial management of residents. The company’s advantageous businesses such as investment banking and fixed income continue to be in the forefront of the market, the core businesses such as institutional business and asset management have been steadily improved, and the wealth management business is even more commendable Significant progress has been made. These achievements benefited from the progress of the times, the stability of the country and the increasing maturity of the capital market, which laid a solid foundation for the company to further enhance its comprehensive financial service capacity.
Wang Changqing further said that 2022 is destined to be another extraordinary year. The company will rise to the difficulties, act actively and make unremitting efforts to build China Securities Co.Ltd(601066) securities into a first-class investment bank in China with customer trust, employee recognition and shareholder satisfaction.
