Securities firms consolidated supervision enters substantive implementation phase, with 6 leading brokers taking the lead in reporting

Staff Reporter Zhou Shangyu

On March 18, the Securities Daily reporter learned from brokerage firms that the China Securities Industry Association (hereinafter referred to as “CSDIA”) has recently officially launched the first batch of transitional period broker-dealer consolidated management reports and risk control indicator submissions. The initial reporting entities are six leading brokerages that have officially implemented the consolidated supervision pilot. The launch of this reporting work indicates that the industry’s comprehensive consolidated supervision has entered the substantive operational stage.

Jiang Han, senior researcher at Pangu Think Tank (Beijing) Information Consulting Co., Ltd., told Securities Daily: “The steady implementation and orderly promotion of broker-dealer consolidation management will reshape the risk control logic of the securities industry and upgrade the model from ‘individual defense’ to ‘group immunity.’ In the past, risks often concealed in subsidiaries or off-balance-sheet activities, but through transparent management, consolidated supervision requires coverage of domestic and overseas, foreign and domestic currency, and all on- and off-balance-sheet business, eliminating arbitrage opportunities and building a true comprehensive risk management closed loop.”

As a key institutional arrangement for risk management in the securities industry, broker-dealer consolidated supervision has undergone years of preparation and pilot exploration. In 2020, the China Securities Regulatory Commission approved six brokerages to implement consolidated supervision pilots, accumulating replicable and promotable practical experience for the industry. In 2025, CSDIA officially issued the “Guidelines for Securities Company Consolidated Management (Trial)” (hereinafter referred to as the “Guidelines”), clarifying the scope of consolidated management, management requirements for various elements, and differentiated transition arrangements.

According to the specific arrangements issued by CSDIA this time, six pilot brokerages—CICC, China Merchants Securities, CITIC Securities, Huatai Securities, CITIC Construction Investment, and Guotai Haitong—have been designated as the first batch of reporting entities. According to the schedule, these brokerages are required to submit their 2025 consolidated management report by April 30, 2026; and submit the Q1 2026 consolidated risk control indicator data by April 29, with subsequent quarterly regular submissions.

From the list of the first batch of pilots, all six brokerages are industry leaders, representing the industry in terms of asset scale, subsidiary layout, and business complexity.

Jiang Han said: “Selecting six top brokerages for initial testing not only verifies the effectiveness of the rules but also helps the entire industry accumulate replicable experience, reducing systemic trial-and-error costs. Meanwhile, the differentiated arrangements consider the industry’s uneven development, providing small and medium-sized brokerages with a valuable buffer period to improve data governance and system construction, avoiding liquidity shocks or compliance risks that could be triggered by a ‘one-size-fits-all’ approach, ensuring a smooth market transition. In the long run, consolidated supervision essentially raises the thresholds for industry entry and operation. Leading brokerages, with their first-mover advantage and mature group management capabilities, will have more room for business collaboration and innovation pilots, potentially further increasing industry concentration.”

As broker-dealer subsidiaries continue to expand, business boundaries extend, and internationalization progresses steadily, the characteristics of group operation become increasingly evident, highlighting the necessity of strengthening consolidated management.

For the six leading brokerages participating in the pilot, this consolidated management report and risk control indicator submission will further improve their risk management systems. It is understood that after years of pilot exploration, many top brokerages have gradually optimized their consolidated management structures, making substantial progress in achieving full risk coverage, strengthening management of domestic and overseas subsidiaries, establishing risk warning mechanisms, and upgrading infrastructure. The demonstration effect of leading brokerages will effectively promote the entire industry to strengthen risk management and improve overall risk control levels.

“Advancing broker-dealer consolidated management will significantly enhance capital allocation efficiency,” Jiang Han said. “Under a unified risk view, internal group capital can be dynamically optimized based on risk-adjusted returns, breaking down capital barriers between subsidiaries, and guiding capital toward high-return, low-risk quality businesses, thereby unleashing the leverage potential of leading brokerages.”