What development strategy will be adopted in the future by Lin Chuanhui of GF Securities for re-election as chairman?

On May 10, GF Securities held a board meeting and elected a new management team. Lin Chuanhui was elected chairman, Qin Li was hired as general manager, and more than a dozen other executives were also elected. Lin Chuanhui and Qin Li have both worked within GF Securities for many years, Lin Chuanhui was previously the chairman and general manager of GF Securities, and Qin Li is the newly appointed general manager.

According to industry insiders close to GF Securities, the adjustment of the new management team of GF Securities reflects the stability and continuity of its development strategy; Second, it highlights the company's strategic focus, focusing more on forging wealth management capabilities and serving the real economy, and creating "one GF" comprehensive financial services with the whole business chain and the whole life cycle.

GF veteran Lin Chuanhui was re-elected as chairman

On May 10, the first meeting of the 11th board of directors of GF Securities was held in GF Securities Building in the form of on-site combined communication conference. There should be 11 directors present at the board of directors, and 11 directors actually attended. Among them, Liang Shuoling, an independent non-executive director, attended the meeting by correspondence. Supervisors and senior executives of GF Securities attended the meeting.

The meeting deliberated on a number of topics, among which Lin Chuanhui was elected as the chairman of the 11th board of directors of GF Securities, and Qin Li was agreed to be appointed as the general manager of the company.

According to the resume, Lin Chuanhui graduated from Jilin University in 1985 and has been appointed as the general manager of GF Securities since December 2020, the executive director of the brokerage since January 2021, and the chairman of GF Securities since July 2021.

It is worth mentioning that Lin Chuanhui has nearly 30 years of working experience in GF Securities and its subsidiaries.

From December 1995 to October 2002, Lin Chuanhui successively served as the general manager of the Beijing business department, the deputy general manager of the investment banking department, the general manager of the Shanghai business headquarters and the executive deputy general manager of the investment banking department of GF Securities. From October 2002 to August 2003, he served as the general manager of GF Fund (preparation); From August 2003 to December 2020, he served as the general manager and vice chairman of GF Fund, during which he also served as the chairman and general manager of Ruiyuan Capital Management Co., Ltd. and the chairman of the board of directors of GF International Asset Management Co., Ltd.; From September 2021 to December 2021, he also served as the chairman of GF Holdings Hong Kong; Since December 2021, he has also served as a director of China Securities Inter-Agency Quotation System Co., Ltd.

Qin Li holds a Ph.D. in economics from Renmin University of Chinese. He also has more than 20 years of working experience in GF Securities, and has been appointed as an executive director of the Company since April 2011, and has successively served as the general manager of the company's investment and wealth management department, the general manager of the capital operation department, the general manager of the planning and development department, the general manager of the investment department, the assistant to the general manager, the deputy general manager and the executive deputy general manager of the company. Chairman of GF Xinde, Chairman of GF Holdings (Hong Kong), Chairman and General Manager of GF Asset Management.

At this meeting, GF Securities also hired the deputy general manager, compliance director, chief risk officer, board secretary and other senior executives. Sun Xiaoyan served as the company's executive deputy general manager and chief financial officer; Xiao Xuesheng, Ouyang Xi, Zhang Wei, Yi Yangfang, Li Qian, Xu Youjun and Hu Jinquan served as deputy general managers; Xin Zhiyun served as the company's deputy general manager and chief information officer; Wu Shunhu serves as the company's compliance director; Cui Zhouhang serves as the company's chief risk officer; Mr. Yin serves as the secretary of the board of directors, joint company secretary and securities affairs representative of the company.

What is the plan behind this personnel change of GF Securities? Industry insiders pointed out that GF Securities' move will further integrate resources and continue to forge wealth management capabilities. In the new management team, the three executive directors Lin Chuanhui, Qin Li and Xiao Xuesheng all have the experience of serving as chairmen or general managers in the business sectors of public offerings, private placements or securities asset management, and as the first batch of senior management talents in the domestic securities and fund industry, they have deep business understanding and rich management experience in their respective fields.

Among them, Lin Chuanhui has served as the general manager of GF Fund since the beginning of its preparation, and has been at the helm of GF Fund for more than 18 years, making him one of the longest-serving general managers in the history of China's fund industry. Qin Li has served as the chairman of GF Xinde and GF Asset Management, and has served as a director of fund companies for many times. Xiao Xuesheng has served as the general manager of GF Xinde since 2010 and the chairman of GF Xinde since September 2021, with nearly 14 years of experience in private equity management. The inheritance and joining of these executives not only brings rich experience and professional knowledge in the asset management industry, but also helps to build the core competitiveness of pan-wealth management with GF characteristics on the basis of the wealth management advantages of the parent company.

"The appointment of the new management team reflects GF Securities' strategic intention of in-depth layout in the pan-wealth management field, and indicates that GF Securities will strengthen the synergy effect within the group, provide more comprehensive and efficient wealth management solutions by integrating the resources and advantages of different business segments, and further give full play to the unique advantages of the group's 'asset management + wealth management'." An industry insider close to GF Securities commented.

After the company announced the list of executive director candidates earlier, Soochow Securities Research pointed out that the four executive director candidates have rich experience in pan-wealth management, investment, investment banking, etc., which is conducive to further coordinating the superior resources of its asset management institutions, strengthening the business advantages of "wealth management + asset management", continuously improving wealth management capabilities, and better serving residents' financial management; At the same time, we will further deepen the linkage model of "research + investment + investment banking", temper the comprehensive financial service capabilities of the whole business chain and the whole life cycle, and effectively improve the quality and efficiency of serving the real economy.

What development strategy will be chosen?

The stable shareholding structure, board of directors and management are the cornerstones of a listed brokerage company that has gone through the cycle and has always been at the forefront of the industry. After this adjustment, the board of directors and the management team of GF Securities have basically remained stable, which also means that in the fierce competitive environment, the stability and tacit understanding of the leadership team of GF Securities are conducive to the stability and continuation of its strategy.

It is understood that in order to cope with the fierce competition in the industry, GF Securities has put forward the transformation policy of high-quality development earlier based on the new stage of development, focusing on three major directions: strengthening the core business, optimizing the business structure, and improving the ability to change.

First, promote a research-driven business model. Internally, we will integrate the research business into the comprehensive customer service chain, improve customer satisfaction with more targeted solutions, and empower the high-quality development of core businesses such as investment and investment banking. Externally, it actively plays the role of a think tank of the Industrial Research Institute, undertakes research projects of national ministries and commissions and local governments for many times, and makes suggestions and suggestions for regional development. In 2024, the company will take the lead in launching the Guangdong Integrated Circuit Industry and Finance Alliance, giving full play to its research advantages to empower the development of regional strategic emerging industries.

Second, we will continue to optimize our business structure. Strengthen the business advantages of wealth management, asset management, research, etc., vigorously develop the business of capital intermediary institutions, and promote the company's development to be more stable and balanced. In the field of wealth management, the annual report shows that as of the end of 2023, GF Securities ranked 3rd in the industry in terms of the holding scale of non-monetary public funds distributed on behalf of GF Securities, and ranked 1st in the industry for securities investment consulting for ten consecutive years (parent company). In the field of asset management, as of the end of 2023, the total management scale of E Fund and GF Fund's public funds reached 1.7 trillion yuan and 1.2 trillion yuan respectively, ranking first and third in the industry.

Third, implement a customer-centric organizational transformation. It is understood that GF Securities reconstructs the business chain and organizational system around customer needs, steadily promotes the platform-based reform, and serves customers with "one GF". In terms of investment banking, we will give full play to the management empowerment and traction role of the investment banking committee, and meet the diverse needs of customers with "industry specialization, regional localization, product integration, and collaborative efficiency". In terms of retail, we promoted the reform of the wealth management organization system, set up a wealth management and brokerage headquarters, focused on strengthening the capacity building of buy-side investment advisors, and explored the pilot reform of platform-based business departments, which achieved positive results.

The scale of consignment financial products has increased significantly

In the first quarter of 2024, GF Securities achieved a total operating income of about 4.949 billion yuan, and the net profit attributable to shareholders of the listed company was 1.538 billion yuan. In 2023, GF Securities will achieve a total operating income of 23.3 billion yuan and a net profit of 6.978 billion yuan.

In terms of wealth management and brokerage business, as of the end of December 2023, the scale of financial products distributed by the brokerage increased by 13.98% compared with the end of the previous year; In 2023, the holding scale of non-money market public funds sold in 2023 ranked third among securities firms (data source: Asset Management Association of China, 2024).

As of the end of 2023, the brokerage holds 54.53% of the equity of GF Fund. As of the end of 2023, the total scale of public funds managed by GF Fund is 1,220.982 billion yuan, and the total scale after excluding money market funds is 670.246 billion yuan, ranking third in the industry. Holding 22.65% of the equity of E Fund, as of the end of 2023, the total public fund scale of E Fund was 1,677.340 billion yuan, an increase of 6.65% from the end of 2022; After excluding money market funds, the total scale was 1,013.937 billion yuan, ranking first in the industry.

GF Securities also actively pays dividends to give back to investors. It is understood that GF Securities has accumulated dividends of about 31.9 billion yuan since its listing in 2010, and the cumulative profits distributed in cash in the past three years have exceeded 30% of the average annual distributable profits achieved in the past three years, bringing long-term investment returns to investors. In 2022, based on its confidence in the future development prospects and high recognition of the company's value, GF Securities repurchased A shares with its own funds of RMB 234 million.

This year, the brokerage distributed cash dividends of 3 yuan (tax included) to all shareholders for every 10 shares, and the cash dividends for this year accounted for 32.70% of the net profit attributable to shareholders of the parent company on a consolidated basis in 2023.

Lin Chuanhui pointed out in the 2023 annual report that in 2024, GF Securities will thoroughly implement the spirit of the Central Financial Work Conference and the series of work arrangements of the regulatory authorities, and continue to build a modern financial institution with "good assets, good products, good customers and good platform" in accordance with the work arrangement of "sticking to the main responsibility and main business, guided by strategic planning, and promoting the company's high-quality development to a new level".

Guotai Junan Non-Bank Research pointed out that the State Council said that it will promote the leading securities companies to become stronger and better, and the company's asset management business and institutional service specialization capabilities will be continuously consolidated, so as to help build a first-class investment bank and investment institution. It is expected that the supply-side reform of the industry will accelerate. The State Council said that it will focus on building a "national team" in the financial industry and promote the leading securities companies to become stronger and better. GF Securities' asset management business and institutional services continue to consolidate its professional capabilities, and its public fund brand has obvious advantages and industry-leading investment and research capabilities, which will help serve the wealth management needs of residents and the capital service needs of medium and long-term institutions, and accelerate the construction of first-class investment banks and investment institutions.