The release of new regulations on the management of public securities transaction fees promotes the further optimization of the research business ecology of securities firms_ Oriental Fortune Network

In order to thoroughly implement the new “Nine National Regulations”, on April 19, the China Securities Regulatory Commission formulated and issued the “Public Offerings”securitiesinvestment fundsecuritiesTransaction Fee Management Regulations” (hereinafter referred to as the “Regulations”) will be officially implemented from July 1, 2024. At the same time, the China Securities Regulatory Commission will organize industry agencies to complete the first adjustment of stock trading commission rates before July 1.

The “Regulations” have a total of 19 articles, and the main contents include four aspects: first, to reduce fund stock trading commission rates; second, to reduce fund managers’securitiesThe upper limit of the trading commission distribution ratio; the third is to comprehensively strengthen the relevant compliance and internal control requirements for fund managers and securities companies; the fourth is to clarify the content and requirements for the disclosure of transaction commission information at the fund manager level.

Previously, on December 8, 2023, the China Securities Regulatory Commission studied and formulated the “Regulations on Strengthening the Management of Securities Transactions of Publicly Offered Securities Investment Funds (Draft for Comments)” (hereinafter referred to as the “Draft for Comments”).

A researcher from a securities firm told reporters that the basic ideas and main contents of the “Regulations” are basically consistent with the previous “Draft for Comments”, but the corresponding details have been modified and improved.

Guide the industry back to its research roots

CITIC SecuritiesTian Liang, chief analyst of the financial industry, said: “In comparison, the “Regulations” and the “Draft for Comments” are basically consistent in the identification of core indicators such as commission rate and concentration. At the same time, they encourage a return to the origin of research, strengthen the identification of compliance responsibilities, and Optimization and adjustments have been made in aspects such as improving policy enforceability, which is of great significance to improving investor returns and promoting the construction of high-quality capital markets.”

According to the reporter’s review, the “Regulations” have some new contents compared to the “Draft for Comments”. For example, passive stock funds “are not allowed to pay research services, liquidity services and other expenses through transaction commissions” and “fund managers are not allowed to convert existing funds through “Securities trading model and other methods to circumvent the provisions of Article 5”; in terms of not using transaction commissions to transfer payment fees to third parties, a new sentence is added: “Funds managed by fund managers that adopt the securities trading model use transaction commissions to transfer payments to third-party securities companies Except for payment of research services”.

The improvement of these rules is closely related to the securities brokerage commissions. Regarding the “liquidity service fee” mentioned above, Wang Weiyi, chief analyst of non-bank financial industry at Ping An Securities, said that this shows that public funds cannot also pay brokers for fund market making services in the form of transaction commissions.

Tian Liang also said: “Compared with the previous “Draft for Comments”, the “Regulations” will make up for potential loopholes in the fields of market making commissions, soft commissions, transfer settlements and third-party payments. Research services will become the basis for subsequent commission income and market expansion. Based on the core share, the industry will return to its research roots.”

It is worth noting that the “Regulations” further improve the regulations on transactions in the bond settlement mode. In recent years, the bond-settled model has gradually emerged, and more and more funds have adopted the bond-settled model on the market, including both newly established bond-settled funds and existing existing funds that have announced their conversion to the bond-settled model.

Tian Lihui, dean of the Institute of Financial Development of Nankai University, said in an interview with a reporter from Securities Daily: “The new regulations have more complete provisions on the use of bond-settled funds for funds. Securities companies with strong bond-settled fund business may usher in more business in the future. Opportunities; at the same time, the new regulations are conducive to creating a more reasonable and complete commission distribution system, commission distribution will be more market-oriented, and the importance of securities firms’ research services will be further enhanced; the internal management of funds, securities firms and other institutions will be more standardized and transparent , the level of information disclosure such as transaction commission rates and distribution details will also be improved.”

Zhu Keli, the founding president of the Guoyan New Economic Research Institute, told a reporter from Securities Daily: “Overall, the new regulations are conducive to ensuring the legitimate rights and interests of investors, reducing investor costs, promoting public offerings and securities firms to further reduce costs and increase efficiency, and find new performance growth points.”

Actively explore space for performance increase

The “Regulations” clarify that in principle, the stock trading commission rate of passive stock funds managed by fund managers shall not exceed the market average stock trading commission rate, and other fees such as research services and liquidity services shall not be paid through trading commissions; other types Funds can pay for research services through trading commissions, but in principle, the stock trading commission rate shall not exceed twice the market average stock trading commission rate, and no other expenses other than research services may be paid through trading commissions.

This means that this public fund rate reform will have a direct impact on the research business of securities firms, and the current research institute’s main source of income, the commission for warehousing, will be directly affected. Judging from the current industry’s sub-position commission income, Wind Information data shows that in 2023, brokerage fund sub-position commissions will reach 16.835 billion yuan, a year-on-year decrease of 10.81%, and the estimated average sub-position commission rate is 7.8 per 10,000.

Regarding the future industry commission level, Tian Liang predicts: “Based on static data in 2023, after the implementation of the new regulations, the total annual stock trading commissions of public funds will drop by 38%; the first two stages of fee reform measures can provide investors with a cumulative annual The cost saving is about 20 billion yuan. Based on this calculation, the total public offering commission income will drop from 16.8 billion yuan to 10.4 billion yuan, and the public offering commission rate will drop from 7.3 per ten thousand to 4.5 per ten thousand.”

Guotai JunanLiu Xinqi, chief analyst of non-bank finance, said that the implementation of the “Regulations” will have a limited impact on the overall profitability of the industry. Brokerages with stronger research capabilities are expected to benefit from this commission policy reform. At the same time, the scale of bond-settled funds is expected to increase.CICCThe non-bank team also believes that securities companies can collaborate with wealth management, IT and other departments to provide comprehensive financial services to fund companies; in addition, the digitalization of wealth management and sell-side investment research of leading securities companies is also expected to usher in development opportunities.

Under the guidance of the “Regulations”, the business development of securities firms faces challenges, but the opportunities cannot be ignored. Many securities companies began to actively implement reform measures after the implementation of the “Draft for Comments”, focusing on research services and upstream and downstream links, comprehensively improving quality and efficiency, and exploring room for performance increase.

For example,Zheshang SecuritiesThe institute launched a comprehensive reform at the beginning of this year, continues to strengthen the transformation of research business into comprehensive research, and continues to expand the scope of research business customers. The institute is deeply involved in public funds,InsuranceWhile providing services to key institutional clients such as asset management and private equity funds, we also further strengthened ourbankDiscover incremental customers such as financial management subsidiaries and QFII (Qualified Foreign Institutional Investors).

“Faced with the reform of public fund fee rates, the most fundamental response for securities firms is to improve their business and enhance their professional capabilities.”Huatai SecuritiesHe said that in the future, he will continue to improve the service capabilities of the full business chain of prime brokers, give full play to the advantages of leading securities companies, provide more in-depth all-round investment research services for public funds, and form mutual empowerment, mutual help and collaboration with public funds. Developing business ecosystem.

China Merchants SecuritiesIt also said that in the context of the reduction in public fund transaction commissions, the company has promptly adjusted its future business strategy. On the one hand, the agency sales business will place more emphasis on product retention and customer returns, and will increase retention by vigorously developing investment advisory services, ETFs (traded open-end index funds), and bond-denominated products; on the other hand, the research business will be strengthened To enhance competitiveness, we will increase our services to core customers through high-quality investment research activities, strengthen business linkage, and build a think tank brand to enhance our influence. also,China Merchants SecuritiesWe attach great importance to the development of the securities settlement business, set up a special group for securities settlement, carefully select securities settlement products, and make comprehensive efforts to increase the scale of the securities settlement business through initial launch and continued operations.

(Source of article: Securities Daily)

Source of article: Securities Daily

Author of the article: Zhou Shangdan Yu Hong

Original title: New regulations on the management of public securities transaction fees are released to promote the further optimization of the research business ecology of securities firms