Others News
- Broker restarts investment bank after buying JV
Date: 8-Mar-2007 Sources: (Xinhua Online)
Changjiang Securities Co has restarted its investment-banking business after buying a joint venture and is now recruiting nationwide, sources said yesterday.
The Hubei Province-based stock broker has renamed the Shanghai-based underwriting venture as Changjiang Financing Services Co, which has a registered capital of 600 million yuan (77.6 million U.S. dollars), the sources said.
Changjiang and BNP Paribas SA in 2003 set up Changjiang BNP Paribas Peregrine Securities Ltd, which took over most of the Chinese broker's investment-banking business.
The partners said in January that BNP Paribas, France's biggest lender, agreed to transfer its 33 percent stake in the joint venture to Changjiang. But they did not disclose financial terms.
Industry insiders said that the partners differed over the venture's management and development and Changjiang was also disappointed with the firm's slow growth.
'Changjiang had mulled a move into investment banking on its own since early last year,' said a source familiar with the matter. 'Now it's striving to seek securities professionals who have underwriting licenses to boost the lagging business.'
The brokerage has planned to recruit at least 30 persons in Shanghai, Beijing, Shenzhen and Wuhan to fill managerial and research posts, according to the sources.
Changjiang's capital base will likely be strengthened as the broker is expected to issue shares after acquiring Shenzhen-traded Shijiazhuang Refining & Chemical Co for a back-door listing.
'Changjiang is strong in securities brokerage and research,' said a second source close to the broker. 'A public stock sale or a private placement will give it much-needed funds to expand its weak underwriting business.'
Changjiang posted a 2006 profit of 449 million yuan, against a loss of 83 million yuan in 2005, from brokerage commissions and proprietary trading, it said in January.
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