Strong capitalization. Robust market position in China's retail brokerage segment. Conservative management. Groupwide risk management integration at the developing stage. Revenue concentrated in the stock brokerage business and from investment gains. This analysis applies to Haitong Securities Co. Ltd. (Haitong) and its core subsidiary Haitong International Securities Group Ltd. (HTI). The rating on Haitong reflects our expectation that the company will maintain its strong capitalization, retail brokerage franchise, market position in securities-related businesses, and earnings capacity over the next 12-24 months. Haitong's adequate risk management controls and funding also support the rating. We continue to expect Haitong to benefit from a moderate likelihood of extraordinary support from the Shanghai municipal government. The anchor for Chinese securities companies is two notches
