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guotai junan securities, which has recently entered the top ten investment companies with relatively "resilient" performance, has received a new regulatory fine involving luopute (688619.sh), which rang the bell for its ipo on the science and technology innovation board three years ago.

cross-provincial fines target guojin securities

the following year, the xiamen securities regulatory bureau once again issued a fine against listed companies’ intermediaries. the targets of this fine were the sichuan-based brokerage guojin securities and the well-known rongcheng certified public accountants (special general partnership) (abbreviated as rongcheng firm).

the root of the "cross-provincial" punishment comes from the xiamen-based science and technology innovation board listed company - luopute technology group co., ltd. (abbreviated as: luopute).

the xiamen securities regulatory bureau pointed out that in december 2020, luopute signed three supply agreements with customers for three projects in duyun city, guizhou province and other places. in 2021, luopute and its wholly-owned subsidiary luopute system integration co., ltd. (hereinafter referred to as: luopute system integration) signed three supply agreements with customers for six projects in xiangshui county, jiangsu province and duyun city, guizhou province. luopute recognized the revenue of the aforementioned projects based on the time when the delivery was accepted by the customer. in fact, the control of the relevant goods was not transferred to the customer when luopute recognized the revenue. luopute had inflated revenue in 2020 and 2021, and reduced profits in 2022.

as the sponsor of luoput's initial public offering, guotai junan securities failed to perform its duties diligently in the process of continuous supervision of luoput, failed to carry out on-site continuous supervision inspections properly, and the conclusions of the relevant continuous supervision reports and special verification opinions it issued were inaccurate.

on september 10, xiamen securities regulatory bureau issued a warning letter to guojin securities and its sponsors wang xuelin and ruan renqun, who were responsible for continuous supervision, and recorded the relevant situation in the integrity file in accordance with the provisions of the securities and futures market integrity supervision and management measures. it requires them to learn lessons, improve the continuous supervision management mechanism, fully implement the diligence and responsibility requirements, and improve the effectiveness of continuous supervision. it is required to submit a written rectification report within 20 working days.

when auditing the 2020 annual report of luopute, rongcheng did not pay attention to the fact that the storage location of the goods sold in the duyun city project in guizhou province was actually a warehouse leased by luopute, which was a case of failure to perform due diligence. on the same day, the xiamen securities regulatory bureau took supervisory and management measures to issue a warning letter to rongcheng and certified public accountants li jianbin, lian yimin, and jiang ying, and recorded it in the integrity file.

one of the 19 major investment bank deals

recalling may 2020, guotai junan securities served as the sponsor, rongcheng law firm served as the accounting institution, beijing guofeng law firm (hereinafter referred to as guofeng law firm) served as the legal institution, zhongshui zhiyuan asset appraisal co., ltd. (hereinafter referred to as zhongshui zhiyuan) served as the appraisal institution, and luopute submitted its application to the shanghai stock exchange.

with the support of many well-known institutions, luopute passed the listing committee meeting on september 30, 2020. on february 17, 2021, luopute rang the bell for listing.

with its scientific and technological innovation attributes, luopute raised 904 million yuan at a price-earnings ratio of 41.47 times. guojin securities received an underwriting and sponsorship fee of 68.2481 million yuan. rongcheng law firm and guofeng law firm received fees of 7.6557 million yuan and 4.3396 million yuan respectively.

in fact, this is just one of the 19 ipo projects of guojin securities in 2021. this year, guojin securities' investment banking business had a net income of 1.81 billion yuan.

if calculated based on the 25.96% gross profit margin of the investment banking business line, this order is expected to earn 17.72 million yuan. the signatory is proud of it.

senior insurance agent has no record of fines

as of now, guojin securities has a total of 297 insurance agents, of which 132 have no record of successfully signing projects. wang xuelin and ruan renqun, who were fined this time, have 7 and 3 projects under their names respectively. and they have no previous record of punishment, which can be said to be a long-term experience and a "clean history".

specifically, wang xuelin registered and practiced at guojin securities in september 2013 and became a sponsor representative in march 2017. in addition to the luopute ipo project, he also signed the sanan optoelectronics (600703) ipo (continuous supervision) project, zhongda'an (300635) ipo (continuous supervision) project, cape cloud (68828) ipo project, yuanli shares (300174.sz) non-public offering and convertible bond project, and rishang group (002593) non-public offering project.

ms. ruan renqun registered to practice at guojin securities in december 2007 and served as an insurance agent in march 2017. since 2020, she has signed ipo projects for tebao bio (688278), luopute (688619) and tongda chuangzhi (001368). coincidentally, all three are listed companies in xiamen.

two new members will be added to the category c list

experts note that guojin securities currently has four class c insurance agents who have been punished five times in the past three years. the two insurance agents who violated the rules this time have not been included in the list.

a closer look at the penalty information shows that zheng yuexiang's violation occurred in 2014. at that time, as the head of the yifeng clean recommendation and listing project team of hongyuan securities (now merged into shenwan hongyuan), he failed to perform his duties diligently and was held accountable by the xinjiang securities regulatory bureau.

xu wei's violations came from the beijing stock exchange ipo project (withdrawn) of hunan tianji caotang pharmaceutical co., ltd. (hereinafter referred to as tianji caotang) and the shanghai stock exchange ipo project (withdrawn) of rongxin huike electric co., ltd. (hereinafter referred to as rongxin huike) during his tenure at western securities.

interestingly, guojin securities has a magical connection with both companies. hunan dajiaweikang pharmaceutical industry co., ltd. (hereinafter referred to as dajiaweikang), which went public in december 2021, was sponsored by guojin securities. in december 2022, guojin securities signed relevant documents as the financial advisor for dajiaweikang's acquisition of tianji caotang.

in august 2023, guojin securities and rongxin huike signed a guidance agreement for the initial public offering and listing on the science and technology innovation board. in july this year, guojin securities released the fourth guidance progress report. fortunately, xu wei, as a class c insurance agent, did not appear in the project team members.

in december 2021, guojin securities failed to perform due diligence as a sponsor of yangzhou rixing biotechnology co., ltd. (rixing biotechnology) and did not conduct sufficient verification of sales proceeds and internal control. the china securities regulatory commission took regulatory warning measures against guojin securities and its sponsors zou liping and wang jun. the two sponsors were included in the class c list.

the two insurance agents who were fined for the luopute project will receive regulatory warnings and have their files recorded, which will also become a blemish in their careers.

signing executive promoted to company president

another "heavyweight" person who signed the ipo documents of luopute was jiang wenguo, who was the person in charge of the sponsorship business at that time.

according to his resume, jiang wenguo was born in 1967. in his early years, he served as a senior project manager of the investment banking department of everbright securities, deputy general manager and general manager of the shanghai headquarters of industrial securities investment bank, and assistant to the president. he joined guojin securities in december 2006 and obtained the qualification of insurance agent in october 2012. when guojin securities completed its backdoor listing in early 2008, he was the vice president and served for more than 13 years.

in may 2021, jiang wenguo became the president of guojin securities. in mid-2022, jiang wenguo stepped down as the head of the sponsorship business and was succeeded by liao weiping, who was born in 1968.

public information shows that liao weiping once worked at the investment banking headquarters of industrial securities, and can be said to be an old subordinate of jiang wenguo. he followed jiang wenguo to join guojin securities in march 2007, and also obtained the qualification of underwriter in october 2012. in july 2022, he became the general manager of guojin securities shanghai underwriting and sponsoring branch. on august 28 this year, liao weiping became the vice president of guojin securities and officially appeared in the executive sequence.

from 2007 to 2023, as the investment banking business of guojin securities flourished, jiang wenguo, as a senior executive in charge, also saw his salary rise: in 2017, his salary was as high as 7.7282 million yuan. in 2021, at the historical high point of the investment banking business, his salary was 6.8365 million yuan; it declined in 2022 and 2023, but was still around 5 million yuan. the salary level of liao weiping as a senior executive has yet to be revealed.

ranked among the top ten in the industry

in the first half of 2024, the investment banking business of securities companies generally “cut in half”. relatively speaking, guojin securities is relatively “resistant to decline”, with a year-on-year decline of 15.82%. with a net income of 462 million yuan from investment banking business, it ranks ninth in the industry.

due to the recently implemented policy of delayed retirement, the two senior executives familiar with investment banking business will need at least one more term to retire. while receiving high salaries, can they lead the investment banking business of guojin securities to move forward steadily and reduce mistakes?