Net profit increased by 30% but still frequently receives fines! CITIC Securities' investment banking business performance is impressive, but compliance gaps need to be addressed.

This article is sourced from: Time Weekly Authors: Li Qinnan, Lu Yongzhi

Image source: Tuchong Creative

On March 27, CITIC Securities (601066.SH) disclosed its 2025 performance report.

The financial report shows that CITIC Securities achieved an annual operating revenue of 23.322 billion yuan and a net profit attributable to shareholders of 9.439 billion yuan, with both indicators achieving double-digit growth. As a leading brokerage, CITIC Securities saw revenue increases across all four major business segments, with its investment banking business maintaining an advantage.

Yu Fenghui, a senior researcher at the Pangu Think Tank, stated in an interview with Time Weekly reporters that the performance growth of CITIC Securities in 2025 demonstrates its strong competitiveness in the industry and further consolidation of its market position. The dual increase in revenue and net profit reflects the company’s excellent performance in capital market operations and corporate financing services. Additionally, the company’s net profit excluding non-recurring items also saw significant growth, indicating enhanced profitability in its core business and improved operational efficiency.

However, behind the impressive performance report, CITIC Securities still faces compliance risks.

In 2025, the company received three regulatory fines, with violations including: insufficient attention and careful review of abnormal circumstances regarding the sources of shareholders’ contributions, inadequate execution of verification procedures; insufficient attention to non-compliance in revenue recognition and procurement management of issuers, rendering inaccurate verification opinions; insufficient attention and careful review of related party transactions in issuers’ procurement situations.

Investment banking business ranks high

The financial report indicates that in 2025, CITIC Securities achieved an operating revenue of 23.322 billion yuan, a year-on-year increase of 22.41%; a net profit attributable to shareholders of 9.439 billion yuan, a year-on-year increase of 30.68%; and a net profit excluding non-recurring items of 9.468 billion yuan, a year-on-year increase of 30.77%.

By business segment, CITIC Securities’ investment banking division achieved an operating revenue of 3.132 billion yuan, a year-on-year increase of 25.76%; the wealth management division achieved an operating revenue of 8.221 billion yuan, a year-on-year increase of 24.37%; the trading and institutional client services division achieved an operating revenue of 9.724 billion yuan, a year-on-year increase of 20.75%; and the asset management division achieved an operating revenue of 1.428 billion yuan, a year-on-year increase of 13.75%.

It is worth noting that CITIC Securities’ investment banking business has consistently ranked high. The company’s investment banking division primarily includes equity financing, debt financing, and financial advisory services.

Specifically, equity financing has always been the focus of CITIC Securities’ business. Domestically, in 2025, CITIC Securities completed 33 A-share equity financing projects, with a lead underwriting amount of 91.773 billion yuan, ranking third and fifth in the industry, respectively. Among them, there were 12 IPOs with a lead underwriting amount of 19.661 billion yuan; 21 equity refinancing projects were completed with a lead underwriting amount of 72.112 billion yuan. Internationally, CITIC Securities International participated in and completed 7 Hong Kong IPO sponsorship projects in the Hong Kong market, with an equity financing scale of 45.839 billion Hong Kong dollars.

Additionally, CITIC Securities’ debt financing business is on par with its equity financing business. In 2025, CITIC Securities continued to maintain its leading position in the domestic debt financing business, completing a total of 5,131 lead underwriting projects with a lead underwriting amount of 1,733.49 billion yuan, ranking second in the industry. Among them, there were 1,497 corporate bond lead underwriting projects with a lead underwriting amount of 552.353 billion yuan, also ranking third in the industry.

In terms of financial advisory services, in 2025, A-share listed companies completed a total of 80 projects involving issuing shares for asset purchases and major asset restructuring, with a transaction amount of 470.571 billion yuan. Among them, CITIC Securities completed 12 projects, ranking first in the industry; with a transaction amount of 104.446 billion yuan, ranking second in the industry.

CITIC Securities stated to Time Weekly reporters that in 2025, the company increased its layout in the field of technology finance for its investment banking business. Additionally, the company proactively adapts to the trend of the economy evolving from factor-driven to innovation-driven, accelerating the creation of a multi-business, multi-level support system for technological innovation services. In 2025, the company served 22 equity financing projects for technology-driven enterprises, with underwriting amounts exceeding 30 billion yuan; the number and scale of underwriting technology innovation bonds both ranked second in the market.

Regarding the investment banking business, CITIC Securities forecasted in its financial report that as the inclusiveness of the domestic capital market system continues to improve, favorable external conditions for the development of investment banking will be achieved. In 2026, the company will position its investment banking business at its core, assisting in the development of new quality productivity, building a value investment bank, a new quality investment bank, and a digital intelligence investment bank; at the same time, the company will further strengthen quality control work and act as a “gatekeeper” for the capital market.

Compliance loopholes still exist in investment banking business

CITIC Securities was established on November 2, 2005, with major shareholders including Beijing Financial Holdings Group Co., Ltd., Central Huijin Investment Ltd., and China CITIC Group Corporation. The company has over 300 securities branches in 30 provinces, autonomous regions, and municipalities.

Although CITIC Securities achieved double-digit growth in its investment banking business, it still received fines in 2025 for its sponsorship business.

On September 12, 2025, the Shenzhen Stock Exchange announced that on June 28, 2023, it accepted the application for the initial public offering and listing on the Growth Enterprise Market (GEM) by Beijing Guoyao New World Information Technology Co., Ltd., with CITIC Securities as the project sponsor. It was found that CITIC Securities had the following violations during its practice: insufficient attention and careful review of abnormal circumstances regarding the sources of shareholders’ contributions, inadequate execution of verification procedures; insufficient attention to non-compliance in revenue recognition and procurement management of issuers, rendering inaccurate verification opinions.

Time Weekly reporters found that there have been multiple instances in the history of CITIC Securities’ sponsored projects that are similar to the aforementioned penalties.

On September 3, 2024, the Shenzhen Stock Exchange announced that on June 16, 2023, Changchun Zhuoyi Bio Co., Ltd. initiated an application for the initial public offering and listing on the main board, with CITIC Securities as the sponsor. It was found that CITIC Securities failed to adequately focus and carefully verify the execution of the internal control system for promotional activities of Zhuoyi Bio, and the accounting was non-compliant, rendering imprudent verification opinions and failing to urge Zhuoyi Bio to fully disclose; insufficient attention was paid to related party transactions in Zhuoyi Bio’s procurement; and changes in business registration and address were not recorded in the application documents.

Regarding compliance loopholes in the investment banking business, Yu Fenghui pointed out that the compliance risks of CITIC Securities in its sponsorship business cannot be ignored. Being penalized for the second consecutive year due to issues such as inadequate execution of verification procedures and failure to adequately attend to the financial compliance of issuers indicates shortcomings in the company’s internal control.

In addition to receiving fines for its sponsorship business, in 2025, CITIC Securities also received two regulatory fines. On January 10, 2025, the Beijing Securities Regulatory Bureau issued a corrective order stating that CITIC Securities’ derivative business and brokerage business had inadequate management of investor suitability and internal control, reflecting that the company’s compliance management was insufficiently comprehensive, leading to administrative corrective measures against the company.

Another fine was issued on September 23, 2025, where CITIC Securities, as the lead underwriter for Sunshine Zhongke (Fujian) Energy Co., Ltd., had violations in continuous supervision. CITIC Securities learned in January 2024 about Sunshine Zhongke’s suspension of work and production but failed to urge Sunshine Zhongke to standardize its information disclosure obligations and did not perform its duties diligently, resulting in a warning letter from the Fujian Regulatory Bureau.

Yu Fenghui analyzed that in the future, CITIC Securities needs to strengthen internal control, enhance the professional quality and sense of responsibility of its employees, and ensure that all projects are reviewed and managed according to the highest standards. This will help reduce the occurrence of future violations and protect the company’s long-term interests.