Galaxy Securities reports first-half profit of 1.2b yuan
(South China Morning Post)
Updated: 2006-08-06 11:46 China Galaxy Securities, the country's biggest
securities firm wholly owned by the central government, reported a profit of 1.2
billion yuan in the first six months amid its delayed restructuring process to a
shareholding company.
Revenue at the brokerage was 1.4 billion yuan in the first half. Galaxy
Securities' profit was the biggest of all earnings reported by local brokerages
so far. It did not provide year-on-year comparison.
The brokerage, set
up in 2000, reported trading volume of 828 billion yuan in the first half with
the number of clients at more than 3.2 million. It also reported revenue of 310
million yuan from underwriting nine bonds as well as two initial public
offerings including Bank of China and Xinxing Pipes.
Galaxy Securities had yet to complete its restructuring after almost a year
since it received seven billion yuan from Central Huijin Investment, the central
government's investment firm and the Ministry of Finance in August last year, a
source said.
Under the restructuring plan, Galaxy Securities will be renamed China Galaxy
Financial Holding and spin off its securities business into a new unit that will
inherit its current name and 5.99 billion yuan capital.
China Galaxy Financial will then have four new shareholders, Tsinghua Venture
Capital, ChongQing Water Holding, China General Technology (Group) Holding and
Hong Kong-listed China National Building Material who will together invest seven
million yuan into the securities unit.
However, Galaxy Securities has not completed the restructuring even though it
has been two months since the six-month deadline required by the China
Securities Regulatory Commission lapsed. The brokerage now does not have a
timetable to complete the restructuring, said one source with the company.
Galaxy Securities management, who were satisfied with the interim profit,
decided that a restructuring was unnecessary and planned to use the capital
injection from the central government to repay debts, according to the Caijing
magazine.
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