GUANGDONG Enterprises (Holdings) has joined three mainland partners to set up the first branch office of China Southern Securities (CSS), one of three national brokerage houses approved by the People's Bank of China. Officially established last month, the Shenzhen-based CSS claims a registered paid-up capital of 350 million yuan (about HK$472 million) and will serve the southern China area. The other two brokerages houses are based in Beijing and Shanghai. Guangdong Enterprises deputy general manager Zhang Yonglin yesterday said preliminary agreements were reached on Monday over the establishment of CSS's first branch office in Guangdong. China Southern Securities Co (Guangdong), as the new branch will be named, would have a paid-up capital of 100 million yuan and would be led by the Guangdong branch of the Agricultural Bank of China, Mr Zhang said. The other three shareholders - Guangdong Enterprises, Guangdong China International Trust and Investment Corp (CITIC) and Guangdong Yuecai Investment Co - will hold stakes of between 15 and 20 per cent each. Guangdong CITIC is a subsidiary of Beijing CITIC while Guangdong Yuecai Investment is under the umbrella of Guangdong's Ministry of Finance. While the exact equity distribution has yet to be decided, Mr Zhang said the Guangdong branch of the Agricultural Bank of China would have the controlling stake in the venture. He expected the branch office, located in the World Trade Centre in Guangzhou, to begin operating next month following the completion of company registration procedure. ''The setting up of the first CSS branch can be the model for other prospective branch offices in Guangdong and other provinces, thus paving the way for CSS's planned network of branches throughout southern China,'' he said. A successful partnership was likely to spur others in the Pearl River delta and Guangdong cities such as Shunde and Zhongshan, he added. ''In developing a securities industry, Guangdong Enterprises doesn't have any experience, but we will take the initiative,'' he said. Operations at the Guangzhou office will include securities dealing and merchant banking services, embracing the issue of stocks domestically, fund-raising for mainland companies, and the handling of B shares and foreign exchange business. Investment funds will also be included in the brokerage's portfolio.