Source: Broker China Author: Li Wenqing
Since last year, from leading brokerages, medium-sized brokerages, to Internet brokerages, the tide of adjustment of the company's internal organizational structure has continued.
Recently, a Chinese reporter from a brokerage was informed that another medium-to-large securities firm started to adjust the company's internal organizational structure, "packaged" the retail business and institutional business into a wealth and institutional business committee, and revoked the brokerage business management headquarters to push forward the transformation of wealth management. Diversified income.
Industry insiders believe that with the intensified competition in commission rates among brokers and rising cost pressures, it is difficult to maintain a purely channel-based business model supported by profit margins, and it is imperative to transform and upgrade from trading channels to comprehensive wealth management.
At the same time, in the process of wealth management transformation, higher requirements are put forward for the organic synergy and resource integration of various business sectors, which promotes the more market-oriented and professionalized wealth management business of securities companies.
There are also adjustments to the organizational structure of securities companies
Judging from the specific measures taken by securities companies to adjust their organizational structure recently, the removal of the retail business department or the brokerage business management headquarters and the establishment of a wealth management center have become the main path.
Recently, a Chinese reporter from a securities firm was informed that a medium-sized securities firm in the south has recently started to adjust its internal organizational structure, merged the Retail Business Committee and the Institutional Business Committee, changed its name to the Wealth and Institutional Business Committee, and set up corresponding product and performance management departments. Changed to Digital Finance Department, etc.
It is worth mentioning that the brokerage also abolished the brokerage business management headquarters and some large customer departments in the front line.
After the reform of the organizational structure, the newly established department proposed to lead the product and service department, connect with agencies and service agencies, increase the market share of institutional brokerage business, and create more institutional business income.
Among the brokerages, Tianfeng Securities is also taking similar actions.
In July last year, Tianfeng Securities announced the adjustment of the organizational structure, the abolition of the retail business headquarters, the establishment of a wealth management center, the adjustment of various departments under the original retail business headquarters to the wealth management center; the cancellation of the agency brokerage business department, etc.
After the adjustment, Tianfeng Securities Wealth Management Center consists of two departments, namely the Retail Business Department and the Institutional Business Department, of which the Institutional Business Department is mainly responsible for institutional business collaboration and institutional brokerage business.
In addition, small and medium-sized securities firm Hualin Securities also launched a "tribal system" last year, adopted a three-line management model, namely "intelligent management and control line", "technological finance line" and "traditional business line", and cancelled the research institute.
The "tribal system" reform of Hualin Securities aims to break the pyramid and tree-like redundant organizational structure common in financial institutions. Combining its own characteristics and development strategies, Hualin Securities proposes vertical and horizontal opening and closed-loop operation, and vertically sets up teams, Tribes set up branches and guilds horizontally to achieve efficient collaboration between business and technology, so as to enable more agile discovery of opportunities and rapid decision-making and execution.
"Behind this, it is also a game for the company, which involves the readjustment of personnel including executives, mid-level cadres and employees. But in this market era of stock competition, securities companies have to try some new tactics. "A middle-level person from a brokerage told a Chinese reporter from a brokerage.
Chen Mengjie, chief strategist of Yuekai Securities, told the China reporter of securities companies that in the context of the era of great wealth, the transformation of wealth management of securities companies has accelerated. Through organizational structure adjustment, resource integration and business synergy can be achieved to provide customers with better wealth management services.
Strengthen business synergy and facilitate wealth management transformation
Just as a large number of investment advisors have gradually replaced brokers, many brokerages have abolished their brokerage business management headquarters or retail business headquarters in the adjustment of their organizational structure, and established a wealth management department that integrates retail and institutional business.
In addition to the above-mentioned medium-sized brokers and Tianfeng Securities, in April last year, Great Wall Securities also renamed the "brokerage business headquarters" to "wealth management headquarters", and added "Internet Finance Department" and "Credit Business Department" to the wealth management business line.
Chen Mengjie analyzed that, on the one hand, with the improvement of residents' financial management concept in recent years, residents' financial management needs have become more diversified, which brings more diversified income to the wealth management business of securities companies, and puts forward higher requirements for the To C business of securities companies.
On the other hand, with the intensified competition in commission rates among securities firms and rising cost pressures, it is difficult to maintain a purely channel-based business model supported by profit margins, and it is imperative to transform and upgrade from trading channels to comprehensive wealth management.
The non-bank team of Soochow Securities analysts believes that the securities industry is gradually focusing on capitalization, and performance support has gradually shifted from asset-light business such as brokerage business to capital-heavy business such as investment trading.
From 2008 to 2021, the net assets of the securities industry will increase from 0.36 trillion yuan to 2.57 trillion yuan, with an annual compound growth rate of 16.32%. The decline in commission rates has led to a continuous decline in the proportion of brokerage business income, which has increased from 71%. dropped to 31%.
"From the perspective of the current development status of the domestic securities industry, after the implementation of the new asset management regulations, public funds and wealth management subsidiaries have played an increasingly important role in the capital market, and the investor structure has increasingly become institutionalized and professional." The general manager of the brokerage business department of a small brokerage firm in South China told reporters that the needs of institutional clients are comprehensive, specialized and personalized, and higher requirements are put forward for the comprehensive resource matching and response efficiency of brokerage service institutional clients.
Chen Mengjie said that in the process of wealth management transformation, the key lies in how to better organically synergize various business sectors. Among them, the asset-light development model is relatively more popular. By setting up more independent and professional comprehensive departments and C-type business departments , which is conducive to strengthening the integration of resources, coordinating various businesses, promoting the more market-oriented and professionalized wealth management business of securities companies, and promoting the overall ROE of the industry.
Regarding the adjustment of the organizational structure, Liu Quansheng, vice president of Tianfeng Securities, previously told a Chinese reporter from a brokerage firm that on the one hand, he will deploy a lot of troops in the wealth management track.
On the other hand, it will further strengthen the institutional brokerage business, try to promote the prime brokerage business, and will open up the business of asset management, research institutes, investment banking, two financing, derivatives and other businesses to complete the closed loop of the institutional brokerage business.
Chen Mengjie said that the current resident wealth management is gradually showing a trend of diversification and onlineization. The transformation of wealth management is conducive to reducing the dependence of securities companies on traditional brokerage business, and the income structure is more balanced.
At the same time, wealth management is also beneficial for securities companies to reduce costs and increase efficiency, reduce marketing and operating costs through financial technology, and improve operating efficiency.
In the medium and long term, companies with differentiated management such as wealth management and technology finance are expected to achieve higher-quality development, and the income structure will be transformed from a cyclical to a growth style.