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today, the "most handsome guy" in the a-share market is in trouble!

on september 30, cicc was issued a warning letter due to problems such as an imperfect compensation management system and errors in compensation-related information disclosure. on the same day, centaline securities received a warning letter and was also accused by regulators of having problems such as inadequate salary management and performance appraisal systems. the day before, kaiyuan securities was also fined for issues related to salary management.

on the eve of the national day holiday, one of the securities firms that received the fine was guolian securities. guolian securities was warned by the china national association of financial market institutional investors (hereinafter referred to as the "national association of financial market institutional investors") for illegally conducting transactions related to temporarily holding bonds for others, and required comprehensive and in-depth rectification of the exposed problems.

today, the stock market is booming, with trading volume hitting a record high. brokerages have become direct beneficiaries, with 48 brokerage stocks collectively hitting their daily limit. such as citic securities, oriental fortune, shenwan hongyuan, industrial securities, huatai securities, cicc, china merchants securities, etc. collectively hit the daily limit. in addition, the stock trading software sector also surged, with flush, compass, wealth trend, and great wisdom all hitting their daily limit. some analysts pointed out that as the market recovers, securities companies' full-year performance growth expectations will further increase.

three brokerages were fined for imperfect compensation management

on september 30, the beijing securities regulatory bureau disclosed that after investigation, cicc’s salary management system was incomplete, there were errors in salary-related information disclosure, and there were problems with personnel management and information submission, reflecting the company’s failure to effectively implement compliance management. . according to relevant regulations, the beijing securities regulatory bureau issued a warning letter to cicc, requiring it to take warning, carefully identify and rectify problems, establish and improve internal control systems, and effectively improve compliance management levels.

on the same day, centaline securities was also fined for violations in salary management. according to the henan securities regulatory bureau, after investigation, zhongyuan securities had three violations. first, the decision-making process for senior management remuneration matters is not standardized and the disclosure is incomplete. second, the salary management and performance appraisal system is not perfect, the requirements for salary deferred payment are not implemented in place, and the internal accountability mechanism is not strictly implemented. third, there are deficiencies in the construction of personnel management systems and information submission.

in addition, the henan securities regulatory bureau also issued fines to seven securities practitioners. among them, chen changxin and liu siping had engaged in buying and selling stocks and operating other people's securities accounts, jin chu and wang xin had engaged in buying and selling stocks, and jia kailong had engaged in operating other people's securities accounts. zhai jiabin and du zhiwei failed to promptly report the compliance risks related to themselves. in the end, these seven people were issued warning letters by the henan securities regulatory bureau. after checking the china securities association's securities employee information disclosure system, except for du zhiwei, who is currently "unavailable," the other six are working at centaline securities.

the day before, kaiyuan securities was issued a warning letter, which was also related to the imperfect salary management mechanism. according to the shaanxi securities regulatory bureau, after investigation, individual employees of kaiyuan securities secretly distributed collaborative business performance rewards for the second time without the company’s approval. this reflects that the company’s salary management mechanism is imperfect and it fails to effectively prevent the risks of honest employment. in addition, the submission of company personnel employment information was inaccurate and not timely.

three relevant responsible persons of kaiyuan securities also received "qualification penalties" for being involved in the above violations. the shaanxi securities regulatory bureau pointed out that chen zhe, head of the kaiyuan securities asset management headquarters, zhang jiaying, deputy general manager of the kaiyuan securities high-tech branch, and li qing, head of the kaiyuan securities asset management headquarters, all made secret transactions without the approval of the company during their tenure. if a collaborative business performance reward is allocated for the first time and is determined to be an inappropriate candidate, he or she shall not serve as a director, supervisor, senior manager, or head of a branch of a securities company or actually perform the above-mentioned duties within one year from the date of the decision on regulatory measures.

industry salary management supervision becomes more stringent

in recent years, supervision has continuously strengthened guidance on industry salary management, requiring the improvement of relevant requirements for a robust salary system that is consistent with operating performance, business nature, contribution level, compliance risk control, and social culture, and has strengthened the assessment of securities companies in this regard. and penalties for violations. according to an incomplete review by china securities journal, since this year, at least five securities firms, including chengtong securities and hualin securities, have been fined due to issues such as "imperfect personnel and salary management mechanisms."

what is the specific salary situation of the above three fined securities firms? judging from the data in the first half of 2024, the total salary packages of both cicc and centaline securities have declined. calculated according to the formula of "total remuneration for the current period = cash paid to and for employees + employee benefits payable at the end of the period - employee benefits payable at the beginning of the period", cicc's revenue dropped from 5.799 billion yuan in the first half of 2023 to 4.369 billion yuan, a decline of nearly 25%. centaline securities dropped from 525 million yuan in the first half of 2023 to 508 million yuan, a decrease of 3%.

among them, centaline securities, which was pointed out by regulators as having an unreasonable deferred mechanism for executive compensation, paid and paid remuneration (before tax) to key management personnel in the first half of 2024 of 5.4638 million yuan, a year-on-year decrease of 26.20%. at the same time, the pre-tax salary paid to key management personnel in the previous year was 3.124 million yuan, a year-on-year decrease of 68.19%.

as for kaiyuan securities, we can only get a glimpse of the salary situation in 2023 from the latest prospectus. the prospectus shows that kaiyuan securities’ total employee compensation for 2023 will be 1.618 billion yuan. although it has increased compared with the same period last year, the proportion of business and management fees for the current period has remained stable. according to kaiyuan securities, the increase in employee compensation is mainly related to performance growth in 2023.

during the year, 4 securities firms were “named” by the nafmii

among the securities firms that received fines on september 30 was guolian securities. according to the self-disciplinary punishment information of the national association of financial market institutional investors, guolian securities, as a trading institution in the inter-bank bond market, illegally carried out transactions related to temporarily holding bonds for others from january to march 2023, which did not reflect real trading needs or legitimate business purposes. . at the same time, guolian securities’ relevant transaction inquiry records were incomplete and failed to reflect the true transaction process.

in accordance with the relevant self-regulatory regulations of the inter-bank bond market and after deliberation at the self-regulatory disciplinary meeting, the nafmii issued a warning to guolian securities and ordered it to conduct a comprehensive and in-depth investigation into the price inquiry traces, trading business compliance management and other issues exposed by this incident. rectification.

counting guolian securities, four securities firms have been named by the nafmii this year for bond issues.

on may 29, the national association of financial market institutional investors found that cicc, cicc wealth and other institutions had irregularities in the clues handed over by financial regulators, and launched a self-disciplinary investigation into them. on the same day, the nafmii disclosed that it learned that individual issuers failed to strictly implement the central government’s major deployments on preventing and resolving local debt risks during bond issuance, and decided to launch a self-regulatory investigation against everbright securities and other institutions.

although the nafmii has not disclosed in detail the specific violations of the securities firms involved, it has mentioned in previous reports that supervision of the bond market will continue to increase the crackdown on fraudulent issuances, financial falsifications and other information disclosure violations. , strictly investigate non-market issuance behaviors such as low-price underwriting, structured issuance, and "rebates", as well as irregularities in the trading field such as illegal entrustment, transfer of interests, and false quotations by currency brokerage companies, to effectively maintain market order. what is involved in the guolian securities fine is illegal agency holding.

it is worth mentioning that on august 1, the national dealers association reported six typical cases. one example is that private equity funds, securities companies and other institutions assist issuers in "self-financing" issuances and facilitate issuers' illegal activities through "behind holding" illegal transactions.

according to the report, from 2023 to 2024, the nafmii found that company a, a local state-owned enterprise in a certain city, was suspected of "self-financing" of bonds in violation of regulations. it also found that private equity funds, securities companies and other institutions had violations of bond "holding on behalf of others". after investigation, since 2019, the issuer, as the actual investor, has implemented multiple "self-financing" issuances of bonds in violation of regulations through direct investment or indirect investment through affiliated companies, and during this period it has paid large consulting service fees to relevant institutions. .

further investigation by the nafmii found that a number of asset management companies and securities companies, through private agreements and other methods, followed the transaction structure of "buy-hold-sell back" or "buy-hold-sell to the next party". "holding" bonds issued illegally by issuers objectively provides financing facilities for bonds that are difficult for issuers to issue. at the same time, company a also had serious violations of the use of raised funds, and even used the raised funds from some debt financing instruments to directly subscribe for "current" debt financing instruments by "investing and paying on behalf of others," seriously disrupting market order.

on september 30, northern trust and cihu high-tech were also punished by the dealers association for suspected bond violation "self-financing".

among them, cihu high-tech, as the issuer of debt financing instruments, has four violations, including actually contributing capital to subscribe for multi-phase debt financing instruments issued by itself, using large amounts of raised funds directly to subscribe for current debt financing instruments, providing financial assistance to investors, failure to disclose the information disclosure management system when issuing debt financing instruments for the first time. northern trust, as a product manager, assists cihu high-tech in the issuance process to purchase multi-phase debt financing instruments issued by itself through the managed trust plan.

in the end, the nafmii issued a serious warning to northern trust and ordered it to conduct comprehensive and in-depth rectifications on the compliance management issues in product establishment, investment operations and other aspects exposed by this incident. at the same time, the national dealers association publicly condemned cihu high-tech and suspended its debt financing instrument-related business for 2 years; it warned the company’s then chairman and legal representative huang zhongtian; it also issued a warning to xiao kunchang, the company’s head of information disclosure affairs and deputy general manager. warn.