Summary of 2021 annual report performance of securities industry: Wealth Management + self operated two wheel drive, market expansion leading long-term growth

Core conclusion

The resonance between wealth management and proprietary investment business promoted the performance growth of listed securities companies. The 26 listed securities companies within the statistical scope achieved an operating revenue of 533.9 billion yuan in 2021, a year-on-year increase of 23.3%; The net profit attributable to the parent company was 158.3 billion yuan, a year-on-year increase of 30.1%; The roe level was 8.05%, 0.61 percentage points higher than the industry average. In terms of operating expenses, the adjusted operating expenses of 26 listed securities companies increased by 10.2% year-on-year to 224.3 billion yuan; Among them, business and management fees increased by 20.5% year-on-year to 207.5 billion yuan; Credit impairment losses fell sharply by 63% to 10.4 billion yuan.

Institutional Commission and commission income have become the core factors affecting the income of brokerage business. In 2021, the brokerage business income of listed securities companies increased by 21% year-on-year to 111.3 billion yuan; Among them, the growth rate of income from institutional business and wealth management business is significantly higher than that of traditional pure channel Commission. The net income from agent purchase, seat leasing and agent sales is + 11.4% / + 47.2% / + 54.1% year-on-year respectively, accounting for 74.9% / 13.6% / 11.6% respectively. In terms of exploring the business model of wealth management, some securities companies began to pay attention to the buyer’s investment consulting model centered on customer needs. China International Capital Corporation Limited(601995) of the wealth management buyer’s charged assets were nearly 80 billion yuan, with a year-on-year growth rate of more than 180%.

The profit contribution of consolidated public funds has increased, and the development of asset management of securities companies has entered a new stage Orient Securities Company Limited(600958) , China Industrial Securities Co.Ltd(601377) , Gf Securities Co.Ltd(000776) and their public funds accounted for 48.3% / 28.2% / 22.6% respectively. Participating in and holding public funds became the core reason for the differentiation of asset management business income of various securities companies. The overall management scale of asset management of securities companies has been reduced to 8.24 trillion yuan, and the market shares of Citic Securities Company Limited(600030) and China International Capital Corporation Limited(601995) are in an absolute leading position. Seeking public fund license has become the focus of the transformation of asset management companies of securities companies.

The blowout of customer demand business promotes the scale of financial investment, thus boosting business income. Listed securities companies within the scope of statistics realized a self operated investment business income of 149.2 billion yuan, a year-on-year increase of 13.5%. In terms of scale, by the end of the 21st century, the scale of financial investment assets of listed securities companies had reached 4.2 trillion yuan, an increase of 12.6% over the end of the 20th century. Scale has become the core factor driving self investment income Citic Securities Company Limited(600030) , China International Capital Corporation Limited(601995) and China International Capital Corporation Limited(601995) ‘s OTC derivatives hedging positions exceeded 100 billion yuan, driving the high growth of relevant business income.

Investment banking has become the entrance of high net worth customers, and capital intermediary business meets the needs of customers. Driven by favorable policies, the investment banking business of securities companies continued to grow rapidly, the concentration of IPO was further improved, and the personnel expansion of head institutions was significantly faster than that of the industry. By the end of the year, the balance of the two financial institutions had reached 1.83 trillion yuan, a year-on-year increase of + 13.2%; The financing of stock pledge repurchase was 227 billion yuan, down 24.6% from the end of the 20th year, and the asset quality improved steadily.

Investment suggestion: looking forward to 2022, with the promotion of the comprehensive registration system reform, it is expected that the subsequent market will continue to expand, bringing profit growth to the head securities companies. We expect that the roe of the head securities firm will remain above 10% in 2022. We continue to recommend Gf Securities Co.Ltd(000776) , Citic Securities Company Limited(600030) , China stock market news and recommend paying attention to China International Capital Corporation Limited(601995) (H).

Risk tip: the progress of capital market reform is less than expected, the effect of policy implementation is less than expected, industry competition intensifies risks, and credit business risks.

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