Hong Kong strengthens financial ties with the Mainland

A new securities company is seen as a milestone in strengthening securities cooperation between Hong Kong and China.

The Guangzhou GuangZheng Hang Seng Securities Investment Advisory Company Limited (GZHS) will be the first joint venture securities investment advisory company between Hong Kong and China.

GZHS, a joint venture located in Guangzhou, is owned 67% by GuangZheng Securities and 33% by Hang Seng Securities Ltd, the securities arm of Hong Kong’s Hang Seng Bank. Its two shareholders applied last year to set up the first joint venture securities investment advisory company in Guangdong province under the Closer Economic Partnership Arrangement (CEPA).

The joint venture will engage in compiling analysis reports on the valuation of securities and securities-related products, and conduct market research. Timely reports will be disseminated to Mainland institutional investors and individual investors in Guangdong.

GZHS will also be important in implementing the liberalization measures in CEPA, and is an important step forward in enhancing financial cooperation between Guangdong and Hong Kong,

Hong Kong’s Permanent Secretary for Financial Services and the Treasury (Financial Services), Au King-chi has emphasized that boosting financial cooperation between the Mainland and Hong Kong has long been a major policy goal for the government.

"It heralds a good start and is greatly conducive to the innovation and internationalization of the securities business in the two places,” she added. “I sincerely thank the Guangdong Provincial Government and the China Securities Regulatory Commission for their support to realise this project.”

Guangzhou Securities is a member of Yue Xiu Group, the largest state-owned company in Guangzhou in terms of total assets and is engaged in real estate, transport infrastructure, and finance and securities. In 2011, it had total assets of RMB128 billion and total revenue of over RMB10 billion.