Core Viewpoint - Southwest Securities' subsidiary, Xizheng International Securities, will be delisted due to failure to meet resumption guidelines by the deadline, reflecting ongoing challenges faced by Chinese securities firms in international markets [1][4][7]. Group 1: Company Performance and Impact - Xizheng International Securities has a small operational scale, with total assets of only 0.83 million yuan, accounting for just 0.09% of Southwest Securities' total assets as of June 30, 2025 [3][7]. - The revenue for Xizheng International Securities in the first half of 2025 was only 103,000 yuan, representing a mere 0.07% of the parent company's revenue [3][7]. - Southwest Securities reported strong growth in the first half of 2025, achieving revenue of 1.504 billion yuan, a year-on-year increase of 26.23%, and a net profit of 423 million yuan, up 25.76% [7]. Group 2: Challenges and Historical Context - Xizheng International Securities has faced continuous losses, with a total accumulated loss exceeding 1 billion HKD over the past decade, and only achieving profitability in 2015 and 2017 [6]. - The company has been under regulatory scrutiny, with the Hong Kong Stock Exchange previously indicating that it failed to maintain sufficient operational levels, leading to a suspension of trading since March 2024 [4][5]. - Efforts to salvage the company included a failed agreement to transfer shares and perpetual securities, which was ultimately unsuccessful due to the buyer's failure to provide funds [5][6]. Group 3: Industry Trends and Future Directions - The delisting of Xizheng International Securities highlights the broader challenges faced by Chinese securities firms in their internationalization efforts, including significant gaps in asset scale compared to leading global investment banks [7]. - There is a growing interest among Chinese securities firms in virtual asset trading, with firms like Guotai Junan International obtaining licenses to operate in this area, indicating a potential shift in focus for future cross-border business [8]. - Southwest Securities is preparing for a transformation in its cross-border business strategy, aiming to leverage its existing platforms for wealth management and investment banking services [8].