Analysis of Self-Operation Business Risk Exposure of Guosen Securities

Based on publicly disclosed financial report data, I will provide a detailed analysis of the risk exposure of Guosen Securities’ self-operation business.

Based on the quarterly report data of Guosen Securities from 2024 to 2025, the risk exposure of the company’s self-operation business is mainly reflected in the following two core indicators [0][1][2]:

This indicator showed a trend of first rising and then stabilizing from mid-2024 to 2025. After dropping to a periodic low of 41.52% in 2025 Q1, it gradually rebounded to around 45%. The overall risk exposure is controlled within 50% of the regulatory standard, leaving ample safety margin [0][1][2].

This indicator showed a trend of first rising and then falling. After reaching a periodic high of 350.63% in 2025 Q2, it fell back to 317.77% in Q3, mainly benefiting from the company’s active adjustment of its investment portfolio structure [0][2].

All risk indicators of Guosen Securities significantly outperform regulatory standards [0][1][2]:

• Parent company-caliber net capital in 2025 Q3: RMB 76.56 billion [0]
• Net Assets: RMB 123.726 billion [0]
• Core Net Capital: RMB 61.56 billion [0]

1. Bond Investment Dominates
   : The self-operated non-equity securities exposure (317.77%) is much higher than equity exposure (45.38%), reflecting a prudent asset allocation strategy [2]
2. Moderate Equity Exposure
   : The proportion of equity investment to net capital is about 45%, which is at the industry’s medium level [0]
3. Prudent Leverage Utilization
   : The net assets/liability ratio is 43.18%, and the overall financial leverage is controlled within a reasonable range [0]

Guosen Securities has established a comprehensive risk management system for its self-operation business [0][1]:

1. Risk Control Philosophy
   : Adhere to the risk management philosophy of “pursuing reasonable returns under controllable risks”
2. Comprehensive Risk Management System
   : Covers multiple dimensions including liquidity risk, market risk, credit risk, and operational risk
3. Organizational Support
   : Establishes professional institutions such as the Investment Management Committee for business management and risk monitoring
4. Compliant Operation
   : Selected as one of the first securities firms on the “White List” by the China Securities Regulatory Commission (CSRC), and maintains the highest international credit rating among domestic securities firms (Fitch “BBB+”) [1]

• Equity Risk Exposure
  : Low risk; the indicator remains stable in the range of 40-51%, with a large safety distance from the regulatory red line (100%)
• Bond Risk Exposure
  : Medium risk; the indicator is in the range of 282-351%, and attention should be paid to interest rate fluctuation risks
• Liquidity Risk
  : Low risk; all liquidity indicators significantly exceed regulatory requirements
• Overall Risk is Controllable
  : All of the company’s risk control indicators continue to outperform regulatory requirements, with high asset safety and capital adequacy [0][2]

1. Market Fluctuation Risk: The returns of self-operation business are highly correlated with the trend of the securities market
2. Interest Rate Risk: With a high proportion of bond investment, interest rate fluctuations may affect investment returns
3. Changes in Regulatory Policies: The new “Provisions on the Calculation Standards for Risk Control Indicators of Securities Companies” was implemented in January 2025 [0]

[0] 2025 Third Quarter Report of Guosen Securities Co., Ltd. (http://static.cninfo.com.cn/finalpage/2025-10-31/1224776443.PDF)

[1] 2024 Annual Report Summary of Guosen Securities Co., Ltd. (http://static.cninfo.com.cn/finalpage/2025-04-19/1223150205.PDF)

[2] 2025 Semi-Annual Report Summary of Guosen Securities Co., Ltd. (https://static.cninfo.com.cn/finalpage/2025-08-30/1224620858.PDF)