By Baron Laudermilk
On August 20, 2012 Hong Kong Permanent Secretary for Financial Services and the Treasury (Financial Services), Au King-chi, stressed that improving the financial ties between China and HK has been a long term policy goal for the authorities, with the co-operation and integration between HK and Guangdong as the main reason behind it.
Au said that to go through the liberalization measures of China and Hong Kong Closer Economic Partnership Arrangement (CEPA), and an effort to make an significant step forward in improving financial integration between Guangdong and HK, the establishment of the first joint venture securities investment advisory company-Guangzhou GuangZheng Hang Seng Securities Investment Advisory Company Limited (GZHS)- marks a groundbreaking step towards enhancing the cooperation between the securities sectors in the two regions.
"It heralds a good start and is greatly conducive to the innovation and internationalization of the securities business in the two places. I sincerely thank the Guangdong Provincial Government and the China Securities Regulatory Commission for their support to realize this project said Au.
GZHS is owned by 67% by GuangZheng Securties and 33% by Hang Seng Securities Limited, the securities department of Hong Kong Hang Seng Bank. Its two shareholders applied last year to establish the first joint venture securities investment advisory company in Guangdong under the CEPA to begin improving the economic ties between the two places.
The joint venture will be conducting market research on both areas as well as compiling reports on the securities and other related products. Reports will be handed out to Chinese institutional investors as well as investors in Guangdong province.
Guangzhou Securities is a member of Yue Xiu Group, which is the biggest state-owned company in Guangzhou by total assets. By the end of 2011, it had total assets of 128.4b Rmb, and total revenue of over 10b Rmb. During the 12th Five-Year Plan (2011-15), the Yue Xiu Group began developing its own financial business.
Au added, ang Seng is a well-known brand to, and supported by, Hong Kong people. It is also a financial institution of international standard and has lots of experience in providing financial information to private banking customers. Guangzhou Securities was one of the earliest securities companies in China. With its wide scope of business, Guangzhou Securities leverages Guangdong's business advantages and expands its national market opportunities. /p>
An concluded "The joint venture company takes the lead to demonstrate the benefits. I trust there will be more such collaboration in future to help foster the development of securities, insurance, accounting, bonds, fund management, banks and loans on both sides. I also trust the related government departments and financial regulators of both sides will strive to promote their financial co-operation, to encourage more Guangdong enterprises to become listed in Hong Kong and issue Renminbi bonds, and to support more Hong Kong financial institutions to enter the Mainland market and provide high-quality services to investors. /p>
