Fitch Ratings is neutral on the 2024 industry outlook for securities companies in the three major markets of the Asia-Pacific region, including mainland China, Taiwan, and Japan.
The Zhitong Finance app learned that on December 13, Fitch Ratings is neutral on the 2024 industry outlook for securities companies in the three major markets of the Asia-Pacific region, including mainland China, Taiwan, and Japan, because Fitch Awards securities companies will maintain sufficient capital and liquidity buffers, sufficient to cope with potential unexpected losses caused by increasing market fluctuations. Fitch expects that although factors such as sentiment in the capital market put pressure on brokerage and stock trading operations of brokerage firms, the recovery of corporate financing and mergers and acquisitions activities, combined with potential revaluation gains from fixed income portfolios, will support brokerage profits in 2024.
Fitch also expects that the securities industry will be further divided, as brokerage firms with better risk management capabilities and business capabilities will have greater strength to cope with market fluctuations and seize growth opportunities in investment banking and asset management businesses.
All of Fitch's Chinese and Japanese brokerage firms have received varying degrees of rating increases due to government or shareholder support. Its independent credit status is limited to the 'bbb' rating range. This is due to the fact that Fitch's risk assessment results for the securities industry use the 'bbb' rating range as the upper limit to reflect the inherent business cyclicality of the securities industry. Brokers rated in the 'BB' rating range usually have poor business conditions and slightly poor revenue diversity.