During the year, the "three bonds" issued by the brokerage companies had a cumulative total of 291.9 billion yuan in financing
Our reporter Zhou Shangding
In the context of the opening of the financial industry and the development of the securities industry showing the "Matthew Effect", securities firms urgently need to quickly improve their capital strength and competitiveness, and their willingness to raise funds is very urgent.
Since 2021, brokerages have raised a total of 291.92 billion yuan through the issuance of securities company bonds, securities company subordinated bonds, and short-term financing bonds, a year-on-year increase of 11.57%.
In order to regulate the issuance and trading of short-term financing bills of securities companies and promote the stable and healthy development of the money market, the Central Bank has recently revised the "Administrative Measures for Short-term Financing Bills of Securities Companies" (hereinafter referred to as the "Measures") to solicit public opinions.
In this regard, Yang Delong, chief economist of Qianhai Kaiyuan Fund, said in an interview with a reporter from the Securities Daily: "In recent years, brokerages have actively issued short-term financing bills for the needs of liquidity management and financing. The amendments to the "Measures" mainly It is to further regulate the financing behavior of securities firms in issuing short-term financing bills."
There is a cap on the short-term balance of the securities industry
No more than 1.092 trillion yuan this year
Since 2020, the issuance of short-term financing bonds has become an important way for securities firms to replenish funds.
Short-term financing bills have the characteristics of low issuance threshold, short cycle, and quick replenishment of operating funds.
The "Securities Daily" reporter conducted statistics on relevant data and found that since 2021, securities firms have issued 40 short-term financing bills, with a total issuance of 104 billion yuan.
Three securities companies have issued short-term financing bills with a quota of more than 10 billion yuan.
Among them, China Securities has issued 12.5 billion yuan of short-term financing bills this year, and both Guosen Securities and China Galaxy have issued 11 billion yuan.
In recent years, many securities firms have supplemented funds by issuing short-term financing bonds.
In this regard, Zhao Yayun, a researcher of the CITIC Reform and Development Research Foundation, said in an interview with a reporter from the Securities Daily: “Issuing short-term financing bonds has the advantages of low financing costs, high efficiency, smooth channels, and flexible usage, and the operating costs are relatively low. The commission income of brokerage firms is close to zero, coupled with the serious homogeneity of brokerage services, presenting a competition pattern of'scale is king'. Brokerage firms have a great demand for funds, and short-term securities trading has therefore become a more ideal financing tool."
At present, the business model, financing environment, and business risk points of securities companies have undergone major changes. In accordance with the demands of market members and the needs of macro-management in the financial market, the Central Bank specifically revised the Measures on March 5.
The revised draft requires that, in addition to the compliance of various risk indicators with regulatory requirements, the liquidity coverage ratio of securities companies when issuing short-term financing bills should continue to be higher than the industry average, and that liquidity needs can be met in a timely manner at reasonable costs.
"The revised draft cancels the pre-issuance filing, and while simplifying the process, it also raises the relevant threshold. It requires the total balance of the issuance of short-term financing bills and other short-term debt instruments to not exceed 60% of the net capital, and the maximum period does not exceed 1 year. Strengthen management during and after the event. The revised draft not only encourages financial institutions to issue bonds in compliance with regulations, but also strictly controls bond issuance risks, which is conducive to the healthy development of the short-term financial market. This is good for the issuance of short-term financing bills by securities firms." Zhao Yayun further analyzed.
In accordance with the provisions of the revised “Measures” that “the sum of the balances of short-term financing bills and other short-term debt instruments shall not exceed 60% of net capital”, a reporter from the Securities Daily conducted calculations based on the latest operating data of securities companies released by the China Securities Association. As of the end of 2020, the net capital of the securities industry was 1.82 trillion yuan. It is expected that the total balance of short-term financing bills and other short-term debt instruments issued by the securities industry this year will not exceed 1.092 trillion yuan.
142.1 billion yuan issued during the year
Corporate bonds are still the main source of bond financing
The issuance of relevant policies has helped brokerages to further broaden financing channels, reduce financing costs, and meet liquidity management needs.
On May 21, 2020, the Shanghai Stock Exchange and the Shenzhen Stock Exchange respectively issued the "Notice on Issues Concerning the Pilot Program of Public Issuance of Short-term Corporate Bonds."
On May 29 of the same year, the China Securities Regulatory Commission issued the "Decision on Amending the Regulations on the Administration of Subordinated Debts of Securities Companies".
Prior to this, securities firms could only issue subordinated bonds non-publicly, and there was no clear basis for issuing write-down bonds and other types of bonds.
After this revision, the bond issuance channels of securities firms have been further expanded, and the issuance of subordinated bonds by securities firms has begun to accelerate.
Since 2021 alone, many brokerages, including CITIC Securities, CICC, and Shenwan Hongyuan, have been approved to publicly issue corporate bonds worth over 10 billion yuan.
Among them, CITIC Securities obtained wholesale corporate bonds of no more than 80 billion yuan, which aroused great concern in the industry.
"In addition to policy support, there are three important reasons for the large-scale bond issuance of securities firms in recent years." A non-bank financial analyst of a leading listed securities firm said in an interview with a reporter from the Securities Daily. Loose, with low bond issuance interest rates; second, the fund utilization business of securities firms has developed rapidly, and the demand for funds is relatively large; third, the supervisory authority has implemented pilot programs of consolidated supervision of securities firms such as CITIC Securities, which has expanded the bond issuance space of pilot securities firms. "
Issuing securities company bonds is still the main way for securities firms to raise funds.
According to data from Flush Shun iFinD, since 2021, securities firms have issued 51 securities company bonds with a total issuance of 142.12 billion yuan.
Three securities companies have issued securities company bonds with a total amount of over 10 billion yuan this year.
Among them, China Merchants Securities has issued securities company bonds of 21.6 billion yuan, Haitong Securities has issued 17.4 billion yuan, and CITIC Securities has issued 14.5 billion yuan.
In addition, since brokerages were approved to publicly issue subordinated bonds, many brokerages have also had a strong willingness to publicly issue subordinated bonds.
"Securities Daily" reporters after statistics on Flush iFinD data found that since 2021, securities firms have issued 17 subordinated bonds, with a total issuance of 45.8 billion yuan.
Among them, 16 subordinated bonds issued by securities companies are publicly issued, with coupon rates ranging from 3.5% to 4.7%.
As of now, China Merchants Securities has issued 10.8 billion yuan of subordinated debt during the year.
In recent years, there have been obvious signs of "increasing leverage" in the brokerage industry.
According to analysis by Li Xing, a senior strategy analyst at Yuekai Securities, “From the operating data of 2020, the leverage ratio of the securities industry is 3.13, a record high since 2015. The increase in the leverage ratio of the securities industry is related to the large-scale financing of securities companies. Relationship. In the context of the regulatory authorities encouraging industry leaders to grow bigger and stronger and the development of the securities industry showing the Matthew effect, securities firms with stronger capital strength are expected to obtain more business opportunities. Therefore, many securities firms expand their capital scale through bond issuance financing. Leverage increases to obtain a higher net profit scale, thus forming a virtuous circle of development. Compared with large foreign investment banks, the leverage ratio of China's securities industry is still at a low level, and there is still room for further improvement in the future." (Securities Daily)