Top China brokerage CITIC’s profit fell 7.7% in 2022

BEIJING (Reuters) – CITIC Securities Co, China’s biggest brokerage, on Thursday reported a 7.7% drop in profit for 2022 compared with a year earlier, knocked by a volatile market environment and falling investment gains.

Net profit for the 12 months ended December fell to 21.3 billion yuan ($3.10 billion) from 23.1 billion yuan a year earlier, CITIC said in a stock exchange filing.

The figures were largely in line with the preliminary results released in January.

CITIC’s investment income fell by 22.3% to 17.6 billion yuan, while asset management fees fell by around 14% to 2.9 billion yuan, the annual report showed.

“There has been an increased probability of ‘black swan’ and ‘grey rhino’ events given currently unstable market expectations,” the company said in its annual report.

Credit risks associated with financing businesses and investment products, and especially risks related to local government financing, are still increasing, it said.

    China’s brokerages earned 142.3 billion yuan in net profit in 2022, down 25.5%, while their revenue fell by 21.4%, Securities Association of China data show.  

    CITIC shares in Hong Kong closed down 0.59% on Thursday at HK$16.08 prior to the results being announced, compared with a 0.58% rise in the broader market. ($1 = 6.8715 Chinese yuan renminbi)

(Reporting by Ziyi Tang and Engen Tham; Editing by Alex Richardson and Alexander Smith)