China is combining two of its largest state-backed brokerages to create a new behemoth as it seeks to consolidate the $1.7 trillion sector and build stronger investment banks to compete with overseas financial firms.
Guotai Junan Securities Co will merge with smaller rival Haitong Securities Co through a share swap, according to statements from both companies on Thursday. The combination of the firms, both partly owned by Shanghai’s state assets administrator, will create a new entity with assets of 1.6 trillion yuan ($230 billion), topping Citic Securities Co as the largest brokerage.
