How Does Haitong Securities Company Work?

Scale in bond origination, broad retail distribution, dual-licensing for cross-border services, and the ability to combine underwriting with market-making and derivatives hedging deliver pricing, speed and integrated solutions.

• Extensive retail reach enables deep distribution for IPOs and structured products into bank FOF and agency channels.
• Strong fixed-income origination capability supports large DCM deals and ABS transactions across onshore and offshore markets.
• Cross-border platform (Haitong International) enables 24-hour trading, structured notes, and international ECM/DCM access.
• Integrated risk/treasury and proprietary trading allow hedged execution and inventory management, improving execution and margin outcomes.

Management is shifting the mix toward fee-based wealth/AM and DCM to reduce earnings cyclicality, with tiered margin pricing and bundled issuer services to increase wallet share.

• Tiered pricing on margin rates to protect net interest margins.
• Bundled underwriting + market-making + investor relations for issuer clients.
• Cross-selling wealth management to brokerage clients via app and branches.
• Derivatives overlays sold to institutional accounts to increase recurring fees.

Mainland China operations remain the largest revenue source; Haitong International (Hong Kong/offshore) contributes a mid-teens percentage via cross-border ECM/DCM and high-margin mandates.

• Core mainland brokerage and margin finance drive daytime liquidity-dependent revenue.
• Offshore franchise adds diversification via Hong Kong IPOs and cross-border DCM.
• Digital distribution increased managed-account adoption in 2024–2025.
• Strategic focus on DCM and ABS to stabilise fee income.

Reported operating revenue mix across categories referenced above; margin financing volatility eased with policy easing in early 2025, and IB/ABS volumes kept fee income resilient.

• Commissions: 20–25% of operating revenue (2023–2024).
• Interest & margin: 20–30% depending on leverage and rates.
• IB fees: ~15–20% in 2023, supported by DCM league standing.
• Prop trading: historically 15–25%, variable by market cycle.

For strategic marketing and distribution details see Marketing Strategy of Haitong Securities.

• How Haitong Securities works across brokerage, IB and AM channels.
• how does Haitong Securities make money via diversified fee and interest streams.
• Haitong Securities online trading platform features and distribution analytics.
• Haitong Securities asset management products overview and fee trends.

Distribution reach and research coverage enhance allocation authority; a robust DCM pipeline and primary deal distribution remain core strengths in 2024–2025.

• Scale distribution for primary ECM/DCM deals and bookbuilding across China and offshore.
• Dual onshore–offshore licensing supports cross‑border underwritings and structured solutions.
• Integrated derivatives, market‑making and electronic execution capture the shift to options/futures liquidity.
• Research and client connectivity amplify execution quality and allocation outcomes.

Policy support for capital markets reform and a gradual recovery in A-share turnover support a path to higher recurring fees; Haitong aims to monetize underwriting scale, digital WM and cross-border platform to improve profit resilience.

• 2024–2025 focus: shift from volatile trading income toward fee income from WM/AM and DCM.
• Credit exposure: monitored LGFV/ABS positions require provisioning and active risk trimming.
• Derivatives and prime services scaling to capture institutional flow and hedging demand.
• Cross-border capabilities via Haitong International to win mandates denied to purely domestic peers; see Brief History of Haitong Securities for background on international expansion.