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Citic Securities breaks Fitch’s rating ceiling with first ‘A’ category for Chinese brokerage
Award of an A-minus rating seen as a milestone in China’s efforts to build globally competitive investment banks
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Karen Tianin Beijing
China’s most profitable brokerage, and until recently its largest by assets, has become the first mainland securities firm to enter the A-category under Fitch Ratings’ framework, a milestone in China’s efforts to build globally competitive investment banks.
Fitch, one of the world’s three major ratings agencies, assigned an A-minus long-term issuer default rating with a “stable” outlook to both Citic Securities and its Hong Kong-based subsidiary Citic Securities International on Tuesday.
Fitch’s A-category is its highest rating class; the B-category has historically been the ceiling for mainland Chinese brokerages.
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Prior to the rating upgrades on Tuesday, mainland brokerages were generally concentrated in Fitch’s BBB+ category, including China International Capital Corporation and China Securities.
The development comes as Beijing seeks to build a “financial powerhouse” and “cultivate first-class investment banks and investment institutions”, goals that feature prominently in China’s 15th five-year plan and broader financial reform agenda.
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Wu Qing, chairman of the China Securities Regulatory Commission, has also called on the industry to “strive to foster a number of leading institutions with significant international influence” during the plan period.
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