CITIC Securities Q1 revenue and profit both declined, but the amount of equity underwriting still ranks first in the industry | Financial Report News

On April 26, 2024, CITIC Securities released its first quarter financial report for 2024. During the reporting period, the company achieved operating income of RMB 13.755 billion, a year-on-year decrease of 10.38%; net profit attributable to the parent company's shareholders was RMB 4.959 billion, a year-on-year decrease of 8.47%.

In terms of various businesses, CITIC Securities' brokerage business performed steadily. In the brokerage business, with active market trading, the average daily trading volume of stock-based transactions increased by 21.38% year-on-year. CITIC Securities' net revenue from securities trading reached RMB 2.442 billion, a year-on-year decrease of 5.78%, but the decline was smaller than the industry average.

In terms of investment banking business, the equity financing market showed signs of recovery, and the company seized opportunities to complete multiple large IPO projects, ranking first in equity underwriting amount in the industry. The scale of bond underwriting reached RMB 54 billion, increasing market share to 5.3%. Breakthroughs were also made in mergers and acquisitions, the New Third Board, and other businesses, with net fee income from investment banking reaching RMB 869 million.

The transformation of wealth management is steadily progressing, with the scale of asset management business continuing to grow. By the end of the first quarter, entrusted funds reached RMB 162 trillion, a 3.7% increase from the end of the previous year. Key initiatives such as the transformation of large collective products and pension FOF progressed in an orderly manner, with the proportion of actively managed assets increasing to 51%. Benefiting from the growth in scale, revenue from asset management business in Q1 reached RMB 2.358 billion, a 5.62% year-on-year increase.

In FICC business, the company prudently responded to market fluctuations, optimized investment structure, and achieved investment income of RMB 2.282 billion. Seizing opportunities in interest rate bond investments led to a significant year-on-year increase in income; in equity investments, the company reduced holdings of some high-valuation leading companies and realized profits. Additionally, fair value change income was RMB 3.238 billion, mainly due to an increase in unrealized gains on trading financial instruments.

The financial report also shows that CITIC Securities' balance sheet remains healthy, with total assets of RMB 1.56733 trillion, a 7.84% increase from the end of the previous year. Total equity attributable to the parent company's shareholders reached RMB 280.901 billion, a 4.49% increase from the end of the previous year. The company has ample liquidity, with current assets accounting for 94.16% of total assets. Cash and cash equivalents were RMB 334.349 billion, and settlement reserves were RMB 46.896 billion.

As of the end of March, CITIC Securities' net capital under the parent company's calculation was RMB 148.008 billion, with a risk coverage ratio of 254.27%, a liquidity coverage ratio of 303.12%, and a net stable funding ratio of 146.31%, all of which exceed regulatory standards.

In terms of cost control, benefiting from strengthened cost control and optimized revenue structure, CITIC Securities achieved a weighted average return on net assets of 1.88% in Q1