Event

East Asia Qianhai Securities Co., Ltd., a Hong Kong-owned holding securities firm with a registered capital of 1.5 billion yuan and a 26.1% stake in the company, was approved by the Securities Regulatory Commission to set up the company. The other shareholders are Bank of East Asia (49%), Chenguang Holdings (20%) and Qianhai Financial Holdings (4.9%).

Background

East Asia Qianhai Securities is the first batch of Hong Kong holding securities companies approved by the SFC under the framework of Supplement 10 to the closer Economic Partnership arrangement (CEPA) signed between the mainland and the Hong Kong and Macao SAR governments, and the other is HSBC Qianhai Securities. Under the new CEPA policy, East Asia Qianhai Securities has achieved three major breakthroughs:

First, it breaks the restriction that foreign investors cannot hold shares, and the Bank of East Asia has 49% of the shares as the largest shareholder; second, it breaks through the restriction of a single license. East Asia Qianhai Securities has four licenses for securities brokerage, securities underwriting and recommendation, securities asset management and securities self-management, but still does not have securities investment consulting business and margin trading business license. Third, it breaks through the restriction that the domestic shareholders of the joint venture securities company need to be securities companies. Yinzhijie, Chenguang Holdings and Qianhai Financial Holdings are all non-securities companies.

Comment

(1) the license of participating brokerage is approved, and the ecological layout of financial science and technology is becoming more and more perfect. Prior to this, the company has participated in the establishment of Yi'an Insurance (15% shareholding), and has made use of its rich resources and advantages in IT technology, Internet finance, big data and other fields to deeply solve the pain points of traditional insurance, and developed "registered compensation insurance", "rain insurance for commuting and going to work", as well as insurance varieties covering property, medical treatment, travel, accidents and other aspects, which have been recognized by users. The equity participation brokerage has been approved, and the company has obtained an important financial license. if the holding subsidiary Huadao Credit Information can obtain a credit license, then the company has seen an embryonic form in the ecological layout of financial technology in Fintech, and will enter the actual business operation stage from the expected stage of obtaining the license.

(2) effectively promote the coordinated development of other businesses. On the one hand, the business of participating subsidiaries such as insurance and securities will benefit from the company's technological dividend, and the operation is expected to enhance the company's performance; on the other hand, the layout in the field of insurance and securities will feed the company's financial equipment and software and other businesses to promote the development of the company.

We are optimistic about the ecological layout of the company's large financial sector and suggest that we actively pay attention to it.