The landscape of the brokerage industry is undergoing a profound reshaping.

On May 6th, Orient Securities Company Limited (DFZQ) announced a plan to issue shares and pay cash to purchase assets, proposing to acquire 100% of the equity of Shanghai Securities. On May 7th, the company's stock price opened higher but closed lower upon resumption of trading, ending the day with a 2.14% gain.

Both Orient Securities and Shanghai Securities are brokerages under the Shanghai State-owned Assets Supervision and Administration Commission. This acquisition marks another landmark capital operation in Shanghai's securities sector following the merger and reorganization of Guotai Junan and Haitong Securities. The release of the plan signifies a crucial step forward in this transaction.

In terms of asset size, based on data from the end of 2025, the combined total assets of Orient Securities and Shanghai Securities would reach 582.742 billion yuan, ranking tenth in the industry. The combined net assets would exceed 100 billion yuan, reaching 102.491 billion yuan, ranking eleventh in the industry.

Annual reports show that in 2025, Orient Securities achieved operating revenue of 15.358 billion yuan, a year-on-year increase of 26.18%. Net profit attributable to shareholders was 5.634 billion yuan, a surge of 68.16% year-on-year. However, its international and other business segments exhibited an inverted pattern of "shrinking revenue and high costs." Since 2025, Orient Securities has frequently received regulatory penalties, continuously testing its compliance and risk control capabilities.

It is noteworthy that in late March of this year, Orient Securities welcomed its new Chairman, Zhou Lei. This acquisition is the first major strategic initiative he has promoted since taking office, testing his wisdom and courage in steering the merger and integration of a large financial institution. At a time when industry concentration in the brokerage sector continues to increase, how to lead Orient Securities from "scale expansion" to "strengthening and scaling up," and how to accelerate internationalization have become practical challenges he faces.

**01** **Orient Securities Sees Significant Profit Growth, While International and Other Business Revenue Drops Over 30%**

Orient Securities delivered a report card showing growth in both revenue and profit for 2025. In terms of specific revenue, its wealth and asset management business, which contributes the highest proportion of revenue, achieved operating revenue of 6.989 billion yuan, accounting for 45.51% of total revenue. This segment's revenue grew 31.32% year-on-year, with a gross profit margin of 37.06%, an increase of 20.70 percentage points.

In other business areas, Orient Securities' institutional and sales trading business achieved operating revenue of 5.276 billion yuan, up 46.01% year-on-year. Investment banking and alternative investment business revenue was 1.605 billion yuan, an increase of 18%.

Notably, in 2025, Orient Securities' international and other business segments generated operating revenue of 1.950 billion yuan, a decrease of 36.08% year-on-year. In contrast, the corresponding operating costs remained high at 2.658 billion yuan, up 3.71% year-on-year. This means that the international and other business segments not only failed to generate profit but became a "bleeding point" dragging down net profit, with a gross profit margin as low as -36.35%.

Orient Securities' international and other business segments primarily include international business and other operations. The international business is mainly conducted through overseas platforms such as Orient Financial Holdings Limited, Dongzheng International and its subsidiaries, and Orient Futures' Singapore subsidiary, engaging in securities and futures brokerage, asset management, investment banking, and margin financing.

Over the past two years, alongside the wave of Chinese companies expanding overseas, leading brokerages like CITIC Securities and China International Capital Corporation Limited have been aggressively expanding in overseas markets, with international business gradually becoming a growth curve supporting revenue.

In its 2025 annual report, Orient Securities stated its aim to accelerate its international layout, identifying "internationalization" as one of its three strategic drivers. However, due to complex and volatile international situations and ongoing capital market fluctuations, the development of international business places higher demands on the company's operational management, organizational structure, and risk control.

**02** **Equalization of Core Executive Compensation; Low-Level Error Appears in Annual Report**

Data shows that as of the end of 2025, Orient Securities had a total of 8,316 employees, including 6,333 employees at the parent company and 1,983 employees at major subsidiaries. At the end of 2024, the total number of employees was 8,766. Over the course of a year, Orient Securities lost 450 employees, accounting for 5.13% of its total workforce at the end of 2024.

Regarding employee structure, Orient Securities had 6,365 business personnel, constituting 75.31% of the total workforce. There were 264 financial personnel, 765 information technology personnel, and 922 other personnel.

Notably, Orient Securities made a low-level error in the annual report when disclosing employee numbers, mistakenly writing "business personnel (including brokers)" as "business personnel (including economists)."

"Broker" is a securities industry term referring to securities brokers, i.e., employees who represent securities firms in providing securities trading services to clients and earning commissions. "Economist" is a professional concept in economics unrelated to securities industry positions.

Regarding employee compensation, in 2025, the average employee compensation at Orient Securities was 649,500 yuan, an increase of 10.65% from the previous year, equivalent to an average monthly salary of 54,100 yuan. This level places the firm steadily in the upper-middle tier of the listed brokerages' average compensation ranking.

Despite the increase in employee compensation, the compensation for Orient Securities' directors, supervisors, and senior executives seems to have entered a strict "salary cap era." The annual report shows that in 2025, company Vice Presidents Lu Dayin, Financial Director Shu Hong, Vice President Zhang Jianhui, and Vice President Chen Gang each received a total pre-tax compensation of 1.29 million yuan. Board Secretary Wang Rufu and Chief Risk Officer Jiang Helei each received pre-tax compensation of 1.20 million yuan.

Excluding independent directors and some supervisors, the compensation of Orient Securities' core senior executives almost exhibits an equalized characteristic of "equal pay for different work." The figure of "1.29 million yuan" appears to have become an insurmountable compensation ceiling.

In 2024, the compensation gap among different senior executives at Orient Securities was more pronounced. Data shows that Vice President Lu Dayin received pre-tax compensation of 1.4561 million yuan that year, Vice President Chen Gang received 1.28 million yuan, Vice President Wu Zezhi received 1.50 million yuan, Board Secretary Wang Rufu received 820,000 yuan, and Chief Risk Officer Jiang Helei received 1.20 million yuan.

**03** **Frequent Regulatory Penalties; Over 1 Billion Yuan in Principal Still Unrecovered**

In its annual report, Orient Securities refers to "effective compliance and risk control" as its core competitiveness. However, since 2025, the company has received numerous regulatory penalties, continuously testing its risk control capabilities.

In April 2025, the Shenzhen Stock Exchange issued a regulatory letter to Orient Securities and related personnel. The announcement indicated that Orient Securities acted as the independent financial advisor for the Robotech restructuring project. During its practice, it failed to timely disclose information in the restructuring report that could influence investors' decision-making. The company was aware of the signing of relevant agreements during the due diligence process but did not fully fulfill its due diligence responsibilities or urge the listed company to disclose the information promptly.

Beyond investment banking, various branches of Orient Securities have also received several penalties. In April 2025, the Jiangsu Securities Regulatory Bureau issued a warning letter to Ma Haixiong, an employee of the Jiangyin Renmin East Road Securities Business Department of Orient Securities. During his tenure at this branch, he facilitated clients in using others' stock option accounts.

In June 2025, the Hubei Securities Regulatory Bureau disclosed a decision to take regulatory谈话 measures against the Wuhan Sanyang Road Securities Business Department of Orient Securities. An investigation found that the branch failed to take effective measures to strictly regulate employee business conduct. The former head of the branch, Xu Wujun, did not perform his duties in accordance with company regulations and improperly provided securities investment advice to clients. Some individual employees engaged in违规替客户办理证券交易的行为 (conducting securities transactions on behalf of clients in violation of rules).

In November 2025, the Liaoning Securities Regulatory Bureau issued a warning letter to the Shenyang Nanba Zhonglu Business Department of Orient Securities. The penalty decision pointed out multiple issues at the branch, including a lack of review procedures and compliance review records for marketing activity plans, individual computers not being included in the monitoring system, and imperfect performance evaluation and compensation distribution mechanisms for securities brokerage business employees. Also in November, the Sichuan Securities Regulatory Bureau took administrative监管措施 ordering corrections against the Deyang Lushan South Road Securities Business Department of Orient Securities,指出该营业部存在合规管理和从业人员执业管理不到位、未及时报告影响客户权益的重大事件 (指出该营业部存在合规管理和从业人员执业管理不到位、未及时报告影响客户权益的重大事件).

In December 2025, the Shanghai Securities Regulatory Bureau decided to issue a warning letter to the Shanghai Putuo District Guangxin Road Securities Business Department of Orient Securities,指出该营业部个别员工不具备证券投资顾问资格，但存在向客户提供投资建议的情形 (指出该营业部个别员工不具备证券投资顾问资格，但存在向客户提供投资建议的情形).

Apart from regulatory penalties, Orient Securities is also involved in multiple lawsuits. Stock pledge repurchase transactions conducted in earlier years still face difficulties in recovering over 1 billion yuan in principal. Additionally, the company faces substantial claims from Yue Media.

In 2016, Qingdao Yaxing Industrial used shares of "Datong Tui" (formerly Shenda Tong) for stock pledge financing with Orient Securities, with Qingdao Yiweide Trading Co., Ltd. providing real estate mortgage guarantees. This pledge eventually defaulted following the delisting of Shenda Tong, involving a principal amount to be repaid as high as 653 million yuan. In subsequent lengthy litigation, although Orient Securities won the lawsuit and applied to the court for compulsory execution of the mortgaged land from guarantor Qingdao Yiweide, the mortgaged land failed to sell in two judicial auctions from November to December 2025. Entering the first quarter of 2026, the asset has been forced into judicial变卖程序.

Furthermore, Orient Securities is involved in multiple equity mortgage financing defaults. Among these, Shanghai Yutai Dengshuo Investment Center defaulted on mortgage financing, with 170 million yuan in principal owed to Orient Securities. Xu Leilei defaulted on a stock pledge-style repurchase transaction with Orient Securities using her restricted shares of "Huangshi Group (维权)", with 119 million yuan in principal owed. Nantong Hongxiang Equity Investment Partnership defaulted on a stock pledge-style repurchase transaction with Orient Securities using its shares of "R环球1" (formerly "Shangying Global"), with 117 million yuan in principal owed.

Notably, Orient Securities also faces a massive claim. This lawsuit stems from the famous Xiangxieli financial fraud case in the A-share market. Orient Investment Bank once served as the independent financial advisor for Yue Media's 2014 acquisition of 100% equity in Shanghai Xiangxieli Advertising Media Co., Ltd. Later, Xiangxieli was found to have engaged in long-term financial fraud. Yue Media sued Orient Investment Bank in court, demanding the return of financial advisory fees and compensation for various losses totaling up to 238 million yuan. The case is currently in the first-instance trial phase at the Shanghai Financial Court.

**04** **'Post-70s' Zhou Lei Takes Helm; Orient Securities' Acquisition of Shanghai证券 Aims for Industry Top 10**

On May 6th, Orient Securities released the transaction plan for acquiring Shanghai Securities, proposing to acquire 100% of Shanghai Securities' equity by issuing A-shares and paying cash. The share issuance price was set at 10.49 yuan per share, based on the average trading price of the listed company's A-shares over the 120 trading days prior to the pricing benchmark date. This signifies a substantive and key step in the integration of Shanghai's state-owned brokerage resources.

Orient Securities was founded in 1998 and is headquartered in Shanghai. Its current registered capital is 8.497 billion yuan. The company completed A-share and H-share listings in 2015 and 2016 respectively, becoming the fifth A+H listed brokerage in the industry. Its largest shareholder is Shenergy Group. As of the end of 2025, Shenergy Group held 2.262 billion shares of Orient Securities, representing 26.63% of the company's total share capital. Shenergy Group is wholly owned by the Shanghai State-owned Assets Supervision and Administration Commission.

Shanghai Securities also belongs to the Shanghai state-owned asset system. It was established in 2001 through the merger of the former Shanghai Finance Securities Company and the securities department of the former Shanghai International Trust and Investment Corporation. In December 2020, the China Securities Regulatory Commission approved Bailian Group becoming the company's major shareholder and controlling shareholder.

According to the transaction plan, Orient Securities intends to acquire the 50% equity of Shanghai Securities held by Bailian Group, the 16.33% equity held by Shanghai International Group Investment, the 7.68% equity held by Shanghai International Group, and the 1.00% equity held by Shanghai Chengtou Group through the issuance of A-shares. Simultaneously, it plans to acquire the 18.74% equity of Shanghai Securities held by Guotai Haitong by issuing shares, and acquire the 6.25% equity held by Guotai Haitong with cash.

It is noteworthy that in late March 2026, Orient Securities welcomed its new Chairman, Zhou Lei. Currently, Zhou Lei also serves as the Deputy General Manager of Shenergy Group, the largest shareholder of Orient Securities.

Public information shows that Zhou Lei was born in 1978. Judging from his履历, before joining Orient Securities, Zhou Lei had already深耕 Shanghai's state-owned financial sector for over 20 years, covering multiple core financial areas such as investment banking and trust, possessing rich experience in financial and investment management work.

As of the end of 2025, the total assets of Orient Securities and Shanghai Securities were 486.876 billion yuan and 95.866 billion yuan, respectively. The combined total asset scale would reach 582.742 billion yuan, surpassing Guosen Securities' total assets of 576.772 billion yuan, entering the industry's top ten.

Regarding net assets, the net assets of Orient Securities and Shanghai Securities were 82.686 billion yuan and 19.805 billion yuan, respectively. The combined net assets would exceed 100 billion yuan, reaching 102.491 billion yuan, lower than Shenwan Hongyuan's net assets of 111.597 billion yuan, ranking eleventh in the industry.