Listed Chinese Securities Firms Step Up Share Buybacks in H2, With More Cancellation-Type Deals

As of August 19, several listed securities firms, including Guojin Securities, Hua'an Securities, Guolian Minsheng, Huachuang Yunxin and Changjiang Securities, have disclosed or advanced share buyback plans in the second half of the year, with individual buyback amounts mostly concentrated in the RMB100 million to RMB200 million range. Chairmen or shareholders of Hongta Securities and Zhongtai Securities have also proposed buybacks, significantly expanding the roster of participating firms. Unlike previous rounds, where buybacks were mostly used for equity incentives or employee stock ownership plans, cancellation-type buybacks have increased notably this time. Hongta Securities and Zhongtai Securities have explicitly stated they will use repurchased shares to reduce registered capital, Guolian Minsheng has set a clause to cancel shares not disposed of within three years after buyback completion, and Huachuang Yunxin plans to cancel 30.35 million historical buyback treasury shares while launching a market value maintenance buyback.

Disclosed plans show that this round of buybacks is characterized by concentrated participation from mid-sized securities firms. Guojin Securities plans to repurchase RMB150 million to RMB300 million to safeguard company value and shareholder interests; Hua'an Securities, Guolian Minsheng, Huachuang Yunxin and Changjiang Securities mostly plan buybacks of RMB100 million to RMB200 million; the chairman of Hongta Securities has proposed a buyback of RMB50 million to RMB100 million to reduce registered capital. Some firms have entered the execution phase. As of the latest announcement dates, Guojin Securities had cumulatively repurchased about RMB150 million, or approximately 50.01% of its announced total buyback funds; Hua'an Securities had repurchased RMB84.1679 million, or approximately 42.08%; Huachuang Yunxin had made an initial repurchase of RMB3.0963 million, or approximately 1.55%.

The purpose of a buyback determines its financial effect. If repurchased shares are used for employee stock ownership or equity incentives, the buyback functions primarily as a medium- to long-term incentive arrangement; if held as treasury shares for later disposal, the impact on short-term financial metrics is limited; if cancelled after repurchase to reduce registered capital, total share capital is directly reduced. With net profit and other conditions unchanged, metrics such as earnings per share and net assets per share would be correspondingly enhanced. Guolian Minsheng plans to use repurchased shares to safeguard company value and shareholder interests, with an arrangement to cancel shares not disposed of within three years after buyback completion. Huachuang Yunxin's buyback is a market value maintenance measure, and it has simultaneously announced plans to cancel historical buyback treasury shares.

As of July 24, the Securities II index traded at a price-to-book ratio of approximately 1.19 times, around the 11.29% percentile since 2012. In the second quarter of 2026, actively managed equity funds held approximately 0.47% of their portfolios in the securities sector, an underweight of about 2.51 percentage points relative to the benchmark. Securities firms' profitability is highly dependent on capital market conditions, with trading volumes, proprietary investment returns, margin financing demand and investment banking activity all affecting earnings sustainability. Securities companies also need capital to support margin financing, market making, proprietary trading, derivatives and equity investment businesses, meaning larger buybacks are not necessarily better.