Important new business is coming! This brokerage firm recently announced
Gaohua Securities announced that it will launch wealth management business.
On June 28, Gaohua Securities CEO Zhang Xing said in an interview with Securities China and other media that Gaohua Securities' wealth management business will mainly target professional investors among high-net-worth clients, providing them with one-stop, comprehensive wealth management solutions covering asset allocation, investment and financing planning, as well as wealth protection and inheritance.
It is worth mentioning that Gaohua Securities' wealth management business will be managed by Wang Jing, who also serves as the deputy general manager of Gaohua Securities. Wang Jing previously led the private banking business of China Merchants Bank for a long time, and later served as the CEO of Credit Suisse Securities. She joined Gaohua Securities in February this year.
"For me, this is my fourth start-up, and for Gaohua, this is a rebirth of development." Zhang Xing is a veteran in the securities industry. From 1997 to 1999, he served as deputy general manager of the investment banking department of CICC. From 2000 to 2003, he served as executive vice president of BOCI Securities, responsible for equity markets and corporate financing business. Since Gaohua Securities was established in 2004, Zhang Xing has served as CEO and legal representative.
Gaohua Securities was initially established as a joint venture with Goldman Sachs to form Goldman Sachs Gaohua Securities. Later, as China continued to relax restrictions on the entry of foreign securities firms, Goldman Sachs gradually completed its full ownership of Goldman Sachs Gaohua. On February 18, 2023, Gaohua Securities completed the business migration with Goldman Sachs Gaohua Securities and continued to operate independently.
Currently, Gaohua Securities is a comprehensive securities company with full licenses. Its current shareholders include Beijing Houfeng Venture Capital Co., Ltd., Beijing Gaowang Venture Capital Co., Ltd., and Beijing Deshang Venture Capital Co., Ltd., each holding 33.3% of the shares. The 2023 annual report shows that Gaohua Securities' revenue was 778 million yuan, a year-on-year increase of 43.23%; its net profit was 145 million yuan, turning losses into profits.
"So, although we are an old company, we are actually a new platform." Zhang Xing said that Gaohua Securities wanted to find a different path to "re-start a business", and this path is wealth management, and it is "a must-do". The value of this part of the domestic business has yet to be further explored.
Zhang Xing believes that the development of China's economy over the past few decades has created huge wealth, and the existing products and tools in the domestic market can provide customers with enough choices to do this well. He compares the development of wealth management business to planting seeds, which is a process of gradual accumulation. Once grown, it can continuously provide the company with a stable cash flow.
Gao Hua Securities' wealth management business will be managed by Wang Jing, who also serves as the deputy general manager of Gao Hua Securities. Wang Jing has long been at the helm of China Merchants Bank's private banking business. She started her banking career at China Merchants Bank in 1994 and was responsible for the establishment of China Merchants Bank's private banking business in 2007. During the 13 years that Wang Jing led China Merchants Bank's private banking business, the number of private banking customers achieved an average annual compound growth rate of 25%, and the average annual compound growth rate of customer assets reached 27%, ranking first in China's private banking business for consecutive years.
In 2020, Wang Jing joined Credit Suisse and was fully responsible for leading and managing Credit Suisse's overall wealth management strategy and business development in China. He was previously the managing director of Credit Suisse, the head of wealth management business in China, and the general manager of Credit Suisse Securities Co., Ltd. The basic information records of practitioners of the China Securities Association show that Wang Jing officially joined Gaohua Securities in February this year.
Focus on professional investors among high net worth clients
Having been deeply involved in the field of wealth management for more than 20 years, Wang Jing believes that from an international perspective, the current Chinese wealth management market is still a blue ocean. "Although many people may think that the wealth management business has become very inward-looking, compared with mature overseas markets, China is still in a state where market segmentation is not clear enough and professional capabilities are not demonstrated enough in this regard."
She also mentioned that when the external environment is complex and changing and market uncertainty increases greatly, customers need more professional wealth management services.
According to the management of Gao Hua Securities, relying on the mature experience of governance mechanisms and management practices of leading international investment banks gained during the development process, as well as the full license resource endowment, and combined with a deep insight into the history, current situation and trends of the local market, the company's wealth management business will take a differentiated development path and select niche areas for professional development.
Specifically, in terms of customer base, it mainly targets professional investors among high-net-worth clients, because their investment experience and investment depth are more in line with Gaohua's resource endowment. In terms of team composition, the service team, including account managers, product managers, investment consultants, investment managers, and strategy research, is customer-oriented and cooperates with each other.
In terms of asset allocation, we build a strategic asset allocation and tactical asset allocation framework through the mean-variance model and BL model to obtain the optimal allocation ratio of major asset classes and secondary subclasses such as cash, equity, fixed income and alternatives. With this as an anchor, we provide investment advice covering all asset classes for the investment portfolio from top to bottom.
In terms of product selection mechanism, through due diligence and prudent evaluation that include different performance and risk indicators, we introduce internal and external product tools with excellent performance in specific segments, sustainable long-term performance, and stable investment style, to create an open product platform that includes different investment strategies and investment targets.
In fact, since 2023, many securities firms have targeted high-net-worth clients, trying to start with family businesses or corporate clients and explore a distinctive wealth management transformation route. The securities firms involved include but are not limited to CITIC Securities, CITIC Construction Investment, Haitong Securities, Galaxy Securities, Guotai Junan Securities, Industrial Securities, and CICC Wealth. The service methods and scope of each securities firm are different, but they all strive to be comprehensive.
For example, CITIC Securities adopts the "11N" customer comprehensive service model, which means that one customer and one key account manager work together on the entire business platform to provide customers with high-quality primary and secondary market services, and at the same time expand more comprehensive and refined services to support comprehensive, complex and flexible customer needs. Another example is Galaxy Securities' "Star Entrepreneur Office", which focuses on entrepreneurs and their family members and has created six service systems including value management, corporate governance, wealth management, share services, family inheritance, and public welfare growth.
What are the main differences in Gaohua Securities' wealth management business? Zhang Xing said that it can be briefly summarized into three points: compared with banks, it has more product tools; compared with foreign capital, it is closer to customers; compared with peers, it has a more focused customer base.
Specifically, Wang Jing said that Gaohua Securities focuses more on high-net-worth clients and can leverage the advantages of full licenses to build a full-spectrum product service system. At the same time, in terms of organizational structure and business model, it is customer-centric, customizes exclusive solutions around customer needs, and mobilizes all resources to serve, rather than just treating it as a subcategory of brokerage business. In addition, compared with other foreign companies engaged in wealth management in the domestic market, Gaohua Securities' advantage lies in localization and its ability to deeply understand the differences in supervision, customers, and products.
Wang Jing emphasized that what Gaohua Securities Wealth Management provides to its clients cannot simply be called products, but solutions. "Solutions are the products of wealth management, and the process of forming solutions is the service of wealth management."
