Core Points - The China Securities Regulatory Commission (CSRC) has recently solicited public opinions on the revised draft of the "Securities Company Classification Evaluation Regulations" [1][2] - The regulations aim to support the differentiated development of small and medium-sized securities firms by optimizing business development scoring indicators [1] - The regulations emphasize the protection of small and medium investors and encourage securities firms to apply for administrative enforcement commitments or to conduct advance compensation [1][2] Group 1 - The revised regulations cancel the scoring indicator for total operating revenue and increase the scoring weight for return on net assets, raising the maximum score from 1 point to 2 points [1] - The coverage of certain scoring indicators has been appropriately increased, expanding the scoring range for return on net assets and major business income from the top 20 to the top 30 firms [1] - The regulations guide small and medium-sized firms to explore differentiated development paths based on their own endowments [1] Group 2 - To strengthen comprehensive penalties for serious violations and better protect the legitimate rights and interests of small investors, the regulations highlight the "crack down on major violations" approach [2] - The revised regulations lower the ratings of securities firms involved in major malicious cases and encourage the effective use of various regulatory measures [2] - The regulations increase the penalty points for "qualification penalties," enhancing the institutional deterrence of self-regulatory management [2]

Core Viewpoint - The China Securities Regulatory Commission (CSRC) has publicly solicited opinions on the revised draft of the "Securities Company Classification Evaluation Regulations," aiming to optimize the classification evaluation system for securities companies and support differentiated and specialized operations for small and medium-sized institutions [1][4]. Group 1: Key Aspects of the Revision - The revision emphasizes enhancing the functional role of securities companies, with the evaluation framework adjusted to focus on four dimensions: risk management capability, compliance status, business development, and functional performance [4][5]. - The revised regulations integrate and optimize business development indicators, encouraging institutions to focus on high-quality development and supporting the differentiated operations of small and medium-sized firms. The new rules eliminate the ranking-based scoring for operating income and reduce redundant scoring for scale indicators while increasing the emphasis on return on net assets [4][5]. - The evaluation results will be adjusted to reflect serious violations, with a clear mechanism for downgrading evaluations for companies involved in significant illegal activities. The revised rules also increase the penalty points for disciplinary actions to enhance evaluation fairness [5]. Group 2: Special Provisions and Adjustments - The regulations summarize previous classification evaluation experiences and introduce rules for handling special issues, such as reducing penalty points for companies that actively seek administrative enforcement and engage in proactive compensation [5]. - New scoring rules are established for companies that resolve significant risks through changes in controlling shareholders, supporting eligible entities in participating in the resolution of troubled securities firms [5].

Core Viewpoint - The China Securities Regulatory Commission (CSRC) has proposed revisions to the classification evaluation system for securities companies, focusing on enhancing their functional roles, optimizing business development indicators, and emphasizing the crackdown on major violations [1][2]. Group 1: Business Development Indicators - The revised regulations eliminate the revenue-based scoring system while increasing the emphasis on return on equity (ROE), raising the maximum score from 1 to 2 points [4]. - The coverage of scoring indicators for major business revenues, including brokerage, investment banking, and asset management, has been expanded from the top 20 to the top 30, with scores ranging from 0.25 to 2 points based on rankings [4]. - The adjustments aim to guide securities companies towards a more efficient and differentiated development approach, encouraging smaller firms to explore unique paths in specific business segments [4][5]. Group 2: Functional Role Enhancement - The revisions stress the importance of securities companies in serving as direct financing facilitators and gatekeepers of the capital market, with specialized evaluations being conducted to assess their capabilities in mergers and acquisitions [2][3]. - The evaluation framework has been updated to include risk management, compliance status, business development, and functional performance, with a new focus on functional performance evaluations organized by the Securities Association [2][3]. Group 3: Regulatory Measures - The revised regulations enhance the penalties for securities companies involved in major violations, expanding the scope of rating downgrades to include significant illegal activities [6]. - The scoring system for disciplinary actions has been adjusted to increase the penalties for "qualification penalties," thereby strengthening self-regulatory measures [6]. - Companies under investigation for violations will incur a minimum score deduction of 1.5 points, while those that voluntarily compensate affected investors may receive a score reduction of up to 1 point, promoting timely remediation and protecting investors' rights [6].

Core Viewpoint - The revised classification evaluation system for securities companies aims to enhance functionality, improve professional capabilities, and support high-quality development, particularly for small and medium-sized institutions [1][12]. Group 1: Regulatory Changes - The title of the rules has been changed from "Securities Company Classification Supervision Regulations" to "Securities Company Classification Evaluation Regulations" to align with the focus on classification evaluation [1]. - The evaluation framework has been adjusted to emphasize risk management, compliance, business development, and functionality [2]. - The revision reflects regulatory guidance towards high-quality development in the securities industry, reinforcing the role of securities companies in facilitating investment and financing cycles [3][10]. Group 2: Evaluation Metrics - The revised regulations optimize and integrate scoring indicators, removing the revenue-based scoring while increasing the emphasis on return on net assets [5][6]. - New indicators have been added to encourage securities companies to enhance their service capabilities in areas like long-term capital market entry and wealth management [7]. - The coverage of certain scoring metrics has been expanded to support differentiated development for small and medium-sized institutions [6]. Group 3: Investor Protection - The regulations strengthen comprehensive penalties for serious violations, enhancing the protection of small and medium investors [8]. - The revision allows for stricter penalties for companies involved in major violations, improving the effectiveness of regulatory measures [9]. - The rules encourage companies to proactively compensate investors affected by violations, thereby reducing the cost and time of investor rights protection [9]. Group 4: Historical Context - The classification evaluation system has undergone multiple revisions since its inception in 2009, with the latest revision reflecting the need for alignment with recent financial policies and strategic goals [12]. - The revisions are designed to better serve the evolving needs of the industry and to promote a balanced approach to regulation [12].

Core Viewpoint - The revised classification evaluation system for securities companies aims to enhance functionality, professional capabilities, and support high-quality development while protecting the interests of small and medium investors [2][4][10]. Group 1: Regulatory Changes - The China Securities Regulatory Commission (CSRC) has publicly solicited opinions on the revised "Securities Company Classification Evaluation Regulations," emphasizing the importance of functionality and professional capability [2]. - The title of the regulations has been changed from "Securities Company Classification Supervision Regulations" to "Securities Company Classification Evaluation Regulations" to align with the new focus on evaluation [2]. - The revised regulations will implement differentiated supervision policies based on the classification results of securities companies, affecting risk control indicators, capital preparation ratios, and inspection frequencies [2][15]. Group 2: Focus on Functionality and Professional Capability - The revision emphasizes guiding securities companies to better fulfill their functional roles and enhance professional capabilities, with a new evaluation framework focusing on risk management, compliance, business development, and functionality [4][5]. - A special evaluation for "functionality" will be organized by the Securities Association, with results incorporated into the classification evaluation, promoting better service to the real economy and national strategies [4][5]. Group 3: Support for Small and Medium Institutions - The revised regulations optimize and integrate scoring indicators to encourage differentiated and specialized operations, removing the revenue-based scoring while increasing the emphasis on return on net assets [8][9]. - The regulations will support small and medium institutions in exploring differentiated development paths, allowing them to achieve better performance in specific business areas [8][9]. Group 4: Strengthening Investor Protection - The revised regulations enhance punitive measures against major violations, expanding the scope for downgrading evaluation results for companies involved in significant illegal activities [11]. - The regulations encourage securities companies to apply for administrative commitments or advance compensation to better protect investors' rights, reducing their costs and time in seeking redress [12][10]. Group 5: Historical Context and Future Implications - The classification evaluation system has undergone multiple revisions since its introduction in 2009, reflecting the evolving regulatory landscape and the need for alignment with national financial strategies [15]. - The recent changes are expected to significantly impact the development landscape of securities companies, reinforcing the connection between regulatory evaluations and company growth [15].

Group 1 - The core viewpoint of the article is the revision of the "Securities Company Classification Evaluation Regulations (Draft for Public Consultation)" to enhance the classification evaluation system for securities companies, aiming to support differentiated development and specialized operations of small and medium-sized institutions [1][3]. - The public is invited to provide feedback on the draft regulations through specified channels, including email and postal address [1]. - The deadline for submitting feedback is set for July 5, 2025 [2].