Money Moves

Mainland giant set for Hong Kong expansion

by Y K Ma

Paul Lam, executive director
Huatai Financial Holdings (Hong Kong) Limited
Photo: Nolly Leung

Despite recent market volatility, Huatai Financial Holdings (Hong Kong) Limited remains bullish about the local stock market. As proof of such confidence in market potential in Hong Kong for the near future, Huatai is set to receive between RMB800 million and RMB10 billion from its parent group, Huatai Securities Co Ltd, to fund business development in Hong Kong this year.

"Our parent group has earmarked a percentage of the funds expected from its planned listing in the first quarter of 2008 for the Hong Kong subsidiary," says Paul Lam, executive director, Huatai Financial Holdings (Hong Kong) Limited. As such, the Hong Kong office will initially take on a team of 50 employees to serve its immediate corporate needs.

The listing is expected to raise between RMB20 and 25 billion on the Shanghai A-share market. Only four securities firms on the mainland have been given approval to establish a Hong Kong office to date. Regarding the financial base, corporate networking and business acumen needed to nurture a successful Hong Kong enterprise, Mr Lam underlines the fact that Huatai Securities Co Ltd is China's fourth largest securities firm in terms of adjusted net capital, with total assets of RMB35.9 billion.

Operations began in April this year and Huatai Financial's securities trading business now boasts a client base of 3,000 customers, of which 95 per cent of customers adopt internet trading, adding to the overall efficiency of the corporation.

Regarding future prospects, Mr Lam expects the Hong Kong customer base to reach 20,000 in two years' time. When this target is reached, daily turnover will amount to between HK$300 million and HK$1 billion. The parent group has an established network of 150 sales branches throughout China. Such penetration on the mainland will help widen the Hong Kong customer base at a rapid pace.

Apart from securities trading, Huatai Financial plans to develop the corporate finance and asset management sides of the company. Mr Lam adds that the company has embraced the opportunity to rise to the exceptionally high standards set by the Securities and Futures Commission in order to gain accreditation for both divisions. Huatai Financial plans to allocate RMB300 million for each of these two sectors and Mr Lam notes that once the parent group is listed, further assets will be set aside specifically to fund these areas.

Qualified people are needed to manage the two new divisions and Mr Lam reveals that the company is also contemplating new acquisitions. "We are considering several possibilities at the moment but pricing remains the key factor. Hiring leaders to manage teams or considering direct acquisitions, or a blend of both, depends on market opportunities," he adds.

  • A 3,000 clientele built since last April
  • Internet trading enhances overall efficiency
  • Parent company China's fourth largest securities firm

Taken from Career Times 18 January 2008, p. D20
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