Enhancing Wealth Management Services through Online-offline Integration
According to the report, the Company’s customer base totaled over 13.28 million and the total assets of customer accounts amounted to RMB3.01 trillion. The Company’s equity and fund trading volume reached RMB11.09 trillion, allowing it to maintain its industry leading position.
In the first half of 2019, the Company adjusted and optimized the organizational structure of its wealth management services to build a service system featuring integrated online and offline businesses and a refined customer service model through “platformatization” and “systemization”. In terms of online strategy, the Company provided its customers with one-stop wealth management solutions through its mobile platform “ZhangLe Fortune Path”. According to Analysys’ statistics, the average monthly active users of “ZhangLe Fortune Path” during the Reporting Period was 7.49 million, ranking first among all securities companies’ apps. Offline, the Company continued to optimize the 241 business branches and nurture its more than 2,000 investment advisors to provide diversified and targeted asset allocation services for customers. It also drew on the experience of AssetMark’s operation management and service system, as well as iterative function upgrades to its wealth management service platform to further support advisors with intelligent customer services solutions. According to statistics from the Securities Association of China, the Company’s investment advisors accounted for 31.40% of its total staff, the highest proportion in the industry as of the end of the Reporting Period.
On financial product sales, the Company strengthened its investment research system with stronger support for product allocation and better guidance on customers’ demands, ensure it further met customers’ multi-layer wealth management needs. During the Reporting Period, the number of financial products on offer (excluding Tian Tian Fa) was 7,979 and the sales volume of financial products (excluding Tian Tian Fa) amounted to RMB167.74 billion.
The capital-based intermediary business continued to rank within the top tier of the industry, with the balance of margin financing and securities lending business reaching RMB54.84 billion as of the end of the Reporting Period.
Sponsoring the First Listing on the SSE STAR Market
Leveraging the integrated investment banking platform and the full-service business chain system, together with its industry-focused development trajectory, regional layout and customer demand exploration, the Company further consolidated domestic and overseas, in-exchange and OTC cross-market synergy. The Company has formed first-class competitive advantages in the industry in terms of financial advisory for M&A and restructuring, as well as in the equity underwriting business. During the Reporting Period, the Company completed six M&A and restructuring transactions approved by the CSRC, ranking first in the industry. According to Mergermarket, it also topped the ranking of financial advisers in China for M&A transaction volume in the first half of 2019.
The new economy with technological innovation at its core has become a leading force in economic development and transformation. The Company actively reinforced its business layout with the launch of the SSE STAR Market. It also sponsored four firms out of 25, including HYC Technology, ranking second place and accounting for 16% of the total in terms of the number of IPOs in the first round of listing on the STAR Market.
In terms of the investment trading, the Company continued to build a customer-centric and transaction-centric business model in order to construct an advanced trading and risk management platform with enhanced trading, market-making, product innovation and comprehensive service capabilities. As for bond market-making trading, the Company has become one of the premiere national debt futures market makers of the China Financial Futures Exchange, and has obtained the business qualification of the main market maker on the Shanghai Stock Exchange. In terms of OTC derivatives trading, the Company ranked third in the industry according to the nominal principal ranking of over-the-counter derivatives of securities companies disclosed by the China Securities Association in the first half of the year.
Industry Leading Position in Asset Management AUM
Competition in the asset management industry has changed and been reshaped at an accelerating pace. With a focus on meeting the standardized and customized needs of customers, the Company continuously improved its product innovation and active asset management capabilities.
According to statistics from the Asset Management Association of China as of the end of the first quarter of 2019, the private asset management scale of Huatai Asset Management averaged RMB849.11 billion on a monthly basis, ranking second in the industry, while its private active asset management averaged RMB233.45 billion on a monthly basis, ranking fourth in the industry. According to statistics from Wind information, the issuance scale of enterprises’ ABS (asset securitization) of Huatai Asset Management during the Reporting Period was RMB44.78 billion, ranking second in the industry.
Global Layout to Create New Opportunities for Development
The first half of 2019 marked an all-rounded acceleration in the Company’s internationalization strategy. The Company has established a new layout for international development with regional connectivity and strategic synergy between mainland China, Hong Kong and the U.S. AssetMark was another new high quality platform asset for the Company. In June 2019, Huatai Securities (USA) obtained a broker-dealer license in the U.S. to carry out broker-dealer business in the country. In addition, the Company was listed on the London Stock Exchange as the first enterprise qualified of its kind for Shanghai-London Stock Connect to issue GDRs, which has enhanced its participation in the international capital markets and bolstered its international reputation, while also laying a foundation for its future expansion in the U.K. and European markets.
As of the end of the Reporting Period, Huatai Financial Holdings (Hong Kong) had a paid-in capital of HK$8.8 billion, the scale of which was among the forefront of the industry in Hong Kong. It participated in three IPO projects and 23 bond issuances, with a total amount of trading and issuance of about HK$16.81 billion. In addition, it completed three financial advisory projects and six structured investments and financing projects.
In 2016, the Company acquired AssetMark, a U.S. turn-key asset management platform (TAMP) which, as of the end of the first quarter, is ranked third and holds 10% market share within the US TAMP industry. As of the end of the Reporting Period, AssetMark’s total platform assets reached US$56.05 billion, representing an increase of 73.5% since the Company’s acquisition. In July, AssetMark was successfully listed on the New York Stock Exchange, which further increased the Company’s global influence.
With the U.S. broker-dealer license approved by the Financial Industry Regulatory Authority in the first half of the year, Huatai Securities (USA) was eligible to conduct broker-dealer business in the U.S., including securities underwriting, securities brokerage for institutional investors, M&As and financial consulting, etc., which enabled it to continue to deepen and expand the development of its international business and full business chain system in the U.S.
In 2019, the Company has launched a two-pronged development strategy driven by wealth management and institutional services with technology empowerment, with the goal of creating an open and forward-looking platform for the future. The Company established the new Digital Operations Department, hosted four technology expos across China and launched the Digital Services System for Institutional Clients, with the aim of building an industry-leading FinTech ecosystem together with all of its clients and customers.
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