Chinese brokerages see surging profits in 2014

BEIJING - Chinese brokerage firms posted big profits in 2014, boosted by a surging margin trading business and a warming stock market.

Combined net profits of 120 firms totaled 96.55 billion yuan ($15.75 billion) in the last year, up by 119.34 percent from a year ago, data from the Securities Association of China (SAC) said on Tuesday.

Only 1 brokerage failed to register profit, down from 11 in 2013, the data showed.

Aggregate revenues amounted to 260.28 billion yuan, more than 60 percent higher than 2013, SAC said. Income from brokerage charges accounted for around 40 percent of the total, benefitting from enormous turnover on the market.

Combined daily turnover of the Shanghai and Shenzhen bourses surpassed 1 trillion yuan on Dec 5, setting a new world record. The full-year turnover totaled 74.4 trillion yuan last year.

The sector's strong performance was also attributed to rapidly-developing margin trading business, the annual income growth of which accelerated to 141.7 percent in 2014.

Chinese shares were bullish in the last quarter of 2014, thanks to a recovering economic climate and easing measures from the central government.

China's benchmark Shanghai Composite Index (SCI) jumped more than 50 percent year on year by the end of 2014.

However, recent official moves signaled concerns from the policy makers on rising shares. The top securities regulator, the China Securities Regulatory Commission, announced it would strengthen control on margin trading, while other authorities curbed capital flow into the market.

The SCI plunged 7.7 percent on Monday, the steepest daily fall since June 2008.