Citic Securities

Citic Securities promotes chiefs to global roles

The Chinese securities house looks to boost cross-border business by redefining executives’ responsibilities.
Source: Citic Securities
Source: Citic Securities

Citic Securities plans to promote some senior managers involved in cross-border business, a move designed to enhance its capacity in exploiting opportunities across domestic and global markets.

China’s biggest securities house by revenue and net profit will expand the responsibilities of three senior executives, effective September 1, according to a company statement on Thursday.

Xu Gang, head of brokerage and research management, will become the global head of brokerage. Chief financial officer Ge Xiaobao will be named global chief financial officer.

Jonathan Slone, current chairman and chief executive of CLSA, acquired by Citic Securities last July, will be appointed co-CEO of Citic Securities International, the offshore arm of the Chinese bank.

Slone will assist Yin Ke, a member of the executive committee and vice-chairman of Citic Securities. Both will retain their current roles.

Slone will also work closely with Xu Gang to oversee the equity brokerage business and cooperate in transactions across domestic and international markets.

Citic Securities also reported first-half results on Thursday, with revenue hitting Rmb16.3 billion ($2.7 billion), a year-on-year growth of 123%. Net profit was Rmb4 billion, or a year-to-year increase of 93%.

The promotions by Citic Securities come as investors on the mainland and in Hong Kong are just becoming able to buy and sell shares listed on Shanghai and Hong Kong stock exchanges for the first time. The mutual market access scheme will bring a combined Rmb500 billion worth of business for brokers in both sides from October.

The move also comes a year after Citic Securities acquired Hong Kong-based broker CLSA for $1.25 billion, which has developed a growing international presence for the Chinese bank.

With further synergies across international platforms, Citic Securities has completed 17 H-share deals, worth $4 billion, and 16 offshore bond transactions, worth $7 billion, in the first half, based on data compiled by FinanceAsia.

While Citic Securities is regarded as one of the winners in terms of  cross-border business, some concerns remain on its near-term profitability.

A Morgan Stanley research report pointed out that the premium valuation on CLSA paid by the Citic, as well as high business and staff costs, are likely to drag down its near-term return-on-equity.

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