- CICC plans a share-swap acquisition of Dongxing Securities and Cinda Securities, creating a group with over RMB 1.01 trillion (US$140 billion) in assets and China’s fourth-largest brokerage by assets.
- The state investor Central Huijin controls all three firms, underscoring Beijing’s push to consolidate the securities sector and build globally competitive champions by 2035.
- Trading in the three stocks will be suspended (Shanghai and CICC in Hong Kong) for up to 25 days while the deal seeks board, shareholder, and regulatory approvals.
- The merger would bolster CICC’s retail/wealth capabilities and capital base, but the combined firm would still trail the biggest global investment banks.
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The planned merger of China International Capital Corporation (CICC) with Dongxing Securities and Cinda Securities is a significant milestone in Beijing’s strategy to streamline its fragmented securities industry and build domestic champions capable of standing up to global investment banks. The share-swap transaction, while yet to be fully disclosed or approved, would create a brokerage with total assets above RMB 1.01 trillion (US$140 billion), positioning CICC as the fourth-largest in China—behind Citic Securities, Guotai Haitong Securities, and Huatai.
Central to this deal is Central Huijin, the state investor that owns major stakes in all three firms; this suggests the merger is more than a market-driven consolidation—it is a state policy implementation aimed at achieving economies of scale, reducing duplication, and reinforcing alignment with national strategic goals. President Xi Jinping’s 2023 directive to raise China’s top-ranked brokerages and the China Securities Regulatory Commission’s stated aim of having two-to-three globally competitive firms by 2035 provide the policy backdrop.
The structuring and timing of the transaction (trading suspensions, share swaps) reflect its complexity and the need to manage regulatory, shareholder, and operational integration risk. All three companies are controlled by Central Huijin, which should ease coordination and decision-making, but major challenges remain around valuation alignment, culture integration (especially given the presence of retail / institutional brokerage, wealth management, underwriting businesses across all entities), and retaining key talent amid competitive pressures.
Strategically, the merger offers CICC boosts in retail reach, underwriting scale, and capital adequacy; it also allows cost synergies from overlapping branch networks and back-office functions. However, despite the size gain, the merged entity will still lag the largest domestic brokerages and remain far smaller than major U.S. and European investment banks—limiting its ability to compete globally unless accompanied by further capital, technological and human-capital investments.
Open questions include: What will the exact share-swap ratios and valuation be? How will regulatory scrutiny manifest, especially in Shanghai and Hong Kong? How deeply will integration affect the business lines (wealth, retail brokerage, underwriting)? And finally, does this presage further consolidation (e.g., with China Galaxy Securities) or even cross-border ambitions as China seeks to compete globally?
Supporting Notes
- The combined assets of CICC, Dongxing and Cinda are RMB 1.01 trillion as of end-September 2025.
- The share-swap merger would make CICC the 4th largest brokerage in China by assets.
- Dongxing and Cinda’s combined market capitalisation is around RMB 100 billion.
- The deal must still secure board, shareholder, and regulatory approvals; trading will be suspended, with Shanghai pausing trading in all three up to 25 days, and in Hong Kong for CICC.
- Central Huijin owns ~40.1% of CICC and via its units controls Dongxing and Cinda.
- Beijing’s goal: cultivate first-class domestic investment banks; the securities watchdog aims for 2-3 globally competitive firms by 2035.
- CICC’s share price rose ~10% in Shanghai following the announcement, while Dongxing surged similarly; indicating market is positive.
- Despite the merger, the new entity will still be far smaller than global firms like Goldman Sachs.