Recently, Huaan Securities issued an announcement stating that the company’s board of directors agreed to establish an asset management subsidiary with a registered capital of 600 million yuan.So far, there are 12 securities firms planning to set up asset management subsidiaries.
Thanks to policy support, the establishment of an asset management subsidiary and an application for a public offering license are becoming an important layout direction for the transformation of the asset management business of securities companies.Experts said that under the background of the formal implementation of the new asset management regulations, this will help securities companies to use their own advantages in investment and research to seek differentiated development, further expand profit margins, enhance market competitiveness, and boost the industry towards high-quality development.
Quickly set up an asset management company
In recent years, the enthusiasm of securities firms to establish asset management companies has increased significantly.In addition to Huaan Securities, at the end of April this year, Guolian Securities and Guosen Securities successively issued announcements saying that they planned to establish asset management subsidiaries.In addition, securities companies such as CITIC Securities, CICC, CITIC Construction Investment, Huachuang Securities, Shenwan Hongyuan and other securities companies are also in the process of establishing asset management subsidiaries.
As for the motivation for setting up asset management subsidiaries, most brokerages said that it is to promote the better development of the asset management business.For example, Huaan Securities announced that in order to better grasp the development opportunities of the asset management industry, expand the depth and breadth of the asset management business, expand and strengthen the asset management business, optimize the company's business income structure, and accelerate innovation and development and business transformation, it is proposed to establish Asset management company.
"In recent years, the brokerage business of securities companies has been transformed into wealth management business, and the demand for customer asset management has continued to increase. Driven by both supply and demand, the pace of securities companies' establishment of asset management subsidiaries has accelerated." said Chen Li, chief economist of Chuancai Securities. The establishment of the company can give full play to the collaborative resources of the asset management business of securities companies, expand the business scope of securities companies, and enhance market competitiveness.
Yao Zeyu, chief analyst and executive general manager of the non-banking financial industry and fintech industry in the research department of CICC, believes that securities companies actively set up asset management subsidiaries for two reasons: First, it is conducive to securities companies to improve their investment research system and cultural mechanism , accelerate the transformation, focus on active management, form multi-business line collaboration, and improve operational efficiency; second, this move is conducive to preparing for the next step to obtain public offering licenses, especially after the recent "one participation, one control, one license" policy was officially implemented. Asset management subsidiaries are expected to become an important starting point for securities companies to increase their "base content" and promote public offerings.
Previously, due to policy restrictions, it was not easy for securities companies to apply for public offering licenses.Among the current public offering licensed institutions, only more than 10 have the background of securities companies.Since the beginning of this year, new regulations that are beneficial to the transformation of securities companies into public offerings have been implemented one after another.On April 26, the China Securities Regulatory Commission issued the "Opinions on Accelerating the Promotion of High-Quality Development of the Public Offering Fund Industry", which clearly adjusted and optimized the public offering fund license system, moderately relaxed the restrictions on the number of public offering licenses under the same entity, and supported securities asset management companies and insurance asset management companies. , bank wealth management subsidiaries and other professional asset management institutions apply for public fund licenses in accordance with the law to engage in public fund management business.
On May 20, the China Securities Regulatory Commission issued the "Measures for the Supervision and Administration of Managers of Publicly Offered Securities Investment Funds" and its supporting rules, stating that under the premise of continuing to adhere to the "one participation and one control" policy of fund management companies, the restrictions on the number of public offering licenses will be appropriately relaxed. Professional asset management institutions such as securities asset management subsidiaries, insurance asset management companies, and bank wealth management subsidiaries under the same group are allowed to apply for public offering licenses.
Under the policy, more and more securities companies have established asset management subsidiaries and applied for public offering licenses.Guolian Securities and Guosen Securities all stated that the proposed asset management subsidiary will engage in securities asset management business, public offering securities investment fund management business, and other businesses approved by regulatory agencies.
"After a securities firm's asset management subsidiary obtains a public offering license, it can enrich its product line through public offering products to meet the diverse needs of investors, and can better undertake large-scale collections to public offering products. This can force securities companies to improve their comprehensive capabilities in active investment research, risk control, and sales, and better share the rapid development dividends of the public fund market under the entry of residents’ assets into the market.” Yao Zeyu said.
Competitive public offering track
Benefiting from the deregulation of public offering licenses, owning a fund license is becoming the direction of many brokerages' efforts.At the same time, the vigorous development of the public offering fund industry has also opened up market space for the transformation of securities companies into public offerings.
According to data released by the China Foundation Association, as of the end of April 2022, the total net asset value of public funds reached 25.52 trillion yuan, with a total share of 23.61 trillion shares.Compared with March, the number and shares of funds have increased overall.
The industry believes that the public offering fund business will become a new growth point for the asset management business of the securities industry, and securities companies with high-quality investment research and channel capabilities will usher in development opportunities."As my country's residents' income continues to rise and capital market reforms are increasingly effective, the inflection point of residents' asset allocation is accelerating, and professional asset management institutions represented by public funds are expected to usher in a period of rapid development." Yao Zeyu said that in recent years, public fundraising has The high growth of fund performance has become one of the important factors affecting the performance differentiation of securities companies. Securities companies with high "base content" that participate in controlling high-quality public funds are favored by the market.
However, the transformation of securities companies into public offerings is by no means easy.Compared with asset management institutions such as commercial banks, wealth management subsidiaries, trust companies, etc., securities companies have the disadvantages of small investor scope, insufficient sales channels, and the pressure of public offering reform for large-scale asset management. The construction of institutional systems such as disclosure needs to be strengthened.
"The main challenges in the transformation of securities companies into public offerings lie in the liquidity requirements of asset management products and the training of professional investment and research personnel." Chen Li believes that securities companies should speed up the innovation and development of equity products and seek new business scale growth.At the same time, under the background of the official implementation of the new asset management regulations, the asset management business of securities companies is gradually shifting from channel business to active equity investment, and the company's operational capabilities, information disclosure capabilities and system maintenance should also keep up.
Many securities companies still have doubts about how to form differentiated development and seek breakthroughs in industry transformation.Yao Zeyu believes that there are three "must answer questions".First of all, it is necessary to establish a sound investment and research risk control system to improve the ability of active management.Including establishing a market-oriented incentive mechanism, cultivating and introducing high-quality investment and research talents, extending the performance appraisal cycle, and guiding long-term value investment; strengthening the empowerment of financial technology, based on big data, artificial intelligence and other information technologies, improving research, quantification and other capabilities, expanding The breadth and breadth of business; establish a high-standard comprehensive compliance risk control system, in the process of promoting the transformation of public offering, it should strictly abide by the bottom line of compliance, and strengthen risk management from organizational structure, business process, personnel management and other aspects.
Secondly, enrich the product matrix and create featured competitive products.For example, actively develop standardized public offering products to enrich the original private equity asset management product matrix; based on its own business and customer endowments, enrich active equity, quantitative, public offering REITs, fixed income + and other characteristic asset management product lines, while satisfying customer needs, Create competitive products and improve customer asset retention.
“We should also continue to improve the client-side business capabilities of wealth management. Through digital transformation and investment advisory team building, we should continue to strengthen front-end customer acquisition and multi-dimensional customer companionship, and optimize channel service capabilities. At the same time, we should give full play to the business synergy between wealth management and asset management. Match high-quality products to suitable customers, and jointly promote the transformation of public offerings from both the supply side and the client side of asset management products." Yao Zeyu said.
Improve proactive management capabilities
This year is the first year of the official implementation of the new regulations on asset management. After a three-year transition period, securities companies have actively promoted business transformation through the transformation of large-scale public offerings, the establishment of asset management subsidiaries, and the application of public offering fund licenses. , the active management ability has been improved, and the asset management of securities companies has gradually returned to its origins.
At present, the asset management business has become one of the important driving factors for the growth of securities companies.At the end of 2021, the asset management business scale of the securities industry was 10.88 trillion yuan, a year-on-year increase of 3.53%. In particular, the scale of collective asset management represented by active management increased significantly by 112.52% to 3.28 trillion yuan.The net income of asset management business for the year was 31.786 billion yuan, a year-on-year increase of 6.10%.
It should also be noted that there are still shortcomings in the transformation of the industry, and the transformation of the asset management business of small and medium-sized securities companies is not smooth.In the first quarter, the net income of the asset management business of more than 10 listed securities companies fell by more than 10% year-on-year, and the "Matthew effect" of securities companies' asset management continued to appear.
In addition, since the beginning of this year, many securities firms have been fined by regulatory authorities for their asset management business. The problems are mainly concentrated in the lack of internal control system, imperfect credit risk management mechanism, and low quality of practice.
"With the implementation of the new asset management regulations, the asset management industry pattern of securities companies is facing a reshaping, and active management has become the top priority." Yao Zeyu said that under strict supervision policies such as clearing nesting and channels, and regulating capital pools, the original supervision was based on supervision. The savage growth model of arbitrage, channel business and rigid payment is unsustainable, and the dividends of securities companies’ asset management licenses may disappear, ushering in all-round competition in brand channels, investment research capabilities, product design, investment consulting, etc. Active management capabilities have become the foundation Book.
Ding Xiaofeng, chief fixed income analyst and deputy general manager of the research and development department of Huaxin Securities, believes that due to the obvious homogeneity competition among securities companies, especially in the new asset management regulations, it is strictly regulated to eliminate non-standard and channel, and strictly adopt active management and net worth. Under the background of management, the challenges for the survival and development of small and medium-sized securities companies are increasing. It is necessary to achieve breakthroughs from comparative competitive advantages, break the involution effect of homogeneous competition, and implement curve overtaking or changing lanes to overtake, so as to realize business model innovation. and break through again.
In general, the transformation of the asset management business of securities companies has a long way to go."In the future, it is necessary to strengthen talent training and high-quality project reserves, speed up the public offering transformation of large-scale asset management products, make full use of the advantages of the relatively large customer base of securities companies, select some customers with financial capacity, and conduct public offering business drainage. At the same time, do a good job in Risk control management, using financial technology means to optimize the construction of compliance risk control system, improve the level of refined risk management, and ensure the full coverage of risk management to the business." Chen Li said.
(Editor in charge: Guan Jing)
