Haitong Securities reports profit fall

PUBLISHED : Wednesday, 14 March, 2012, 12:00am
UPDATED : Wednesday, 14 March, 2012, 12:00am


The Hong Kong arm of mainland brokerage Haitong Securities yesterday reported a net profit of HK$153.2 billion for last year, which it said was below its earnings for 2010.

But it was unclear by how much net profits fell year on year, since the 2010 result of HK$345.8 million was for the 18 months ended December 31, 2010, whereas the 2011 result was for the 12 months ending December 31.

Yesterday's result showed that brokerage business, which contributed 46 per cent of the firm's revenues for the year, was down 14 per cent compared with the same 12-month period in 2010, while net profit from the business was HK$39.5 million.

The firm added 15,000 new clients to its customer base last year, of which more than 60 per cent were from the mainland, according to Lin Yong, the vice-chairman and chief executive. It had 160,000 customers as of the end of last year, of which 40 per cent were from the mainland.

Lin said he expected a five to 10 per cent increase in the number of mainland clients this year. Most were interested in red chips, state-owned enterprises as well as Hong Kong- listed mainland shares.

In the year ahead Haitong would strive to expand its yuan business, including yuan bond index products, yuan-denominated initial public offerings and yuan bond trading, he said. The company was the first issuer of a yuan fixed-income fund and the first securities firm to launch a product in Hong Kong under the RQFII (RMB Qualified Foreign Institutional Investors) pilot programme.

Revenue from Haitong's corporate business, which included listings, financial advisory services and yuan bond business, increased 29 per cent to HK$234.7 million, yielding HK$70.2 million in profits.

William Lee, joint managing director, said Haitong would increase the scale of its margin financing business. Revenue from margin business rose 16 per cent to HK$160.5 million last year.

Lee said the firm would expand advances to customers to HK$4 billion or more this year.