Backed by an insurance giant
Ping An Securities is the securities arm of Ping An Group, China's
second-largest insurer. Located in Shenzhen in Guangdong
Province in southern China, the firm began operations in 1991 as a
securities department within its parent company. Ping An
Securities was formally established as a subsidiary in October 1995
with approval from People's Bank of China. With the backing
of its well-known parent, in 2007, Ping An Group was named one of
the Top Ten Brands Most Favored by Chinese Internet Users, Ping An
Securities has grown over the years from a regional securities
house into an integrated nationwide company.
Ping An Securities handles a variety of financial services through
five main divisions: investment banking, fixed earnings, asset
management, research and derivative products. The firm had
reason to sulk at the end of 2008 when it posted almost a
100-percent drop in income for the year. Hurdled by severe
natural disasters and stock market fluctuations, Ping An reported a
net profit of $127.82 million in 2008, a 94.4 percent drop from its
2007 net profit.
Innovation is the name of the game
In 2004, Ping An acted as lead underwriter on four initial public
offerings (IPOs) in the primary market, earning a top ranking that
year for equity offerings. The following year, the firm
pushed forward reforms on nontradable shares for domestically
listed companies. Of all the listed companies that have
announced share reforms, Ping An Securities successfully sponsored
20, ranking as one of the top five securities firms in China.
Among members of the Shenzhen Small and Medium Enterprises Board,
Ping An Securities ranked second among all securities firms in
China in 2005.
Ping An Securities was a pioneer in helping to develop a
next-generation trading system for the Shanghai Stock
Exchange. The firm played a crucial role, setting up a
risk-supervision project and proposing the route for developing
derivative products domestically. For this, the firm was
named Annual Financial Innovator in 2005 by the Securities
Association of China and Capital Circle magazine.
These organizations also named Ping An the Most Influential
Corporate Brand and Best Investment Banking Team for that
year.
Buying stakes and joint ventures
Ping An Group was poised in March 2007 to become China's first
insurer to own a mutual fund company, as Ping An Securities had
reached the final stages of buying a controlling stake (35 percent)
in Jutian Fund Management, one of the country's oldest
stockbrokers. However, by October 2007, U.S. investment bank
Morgan Stanley swooped in and scooped up Jutian for US$8.6
million. In January 2008, Ping An Securities planned a
joint-venture fund management company with United Overseas Bank
(UOB) Asset Management, Singapore's largest asset manager.
Under this, Ping An would get a 75-percent stake of the firm with
the remaining 25 percent to be owned by UOB. The proposed
joint-venture firm has hired Li Kenan from rival company First
State Cinda Fund Management in July 2008 to be its CEO. In
2009, Ping An Securities goes for another venture with its plan to
create a U.S. dollar denominated private-equity fund for its future
investments.