Huatai Securities Co. Ltd. And Huatai International Financial Holdings Co. Ltd.

The stable outlook reflects our view that Huatai will maintain its very strong capitalization and strong market position. We expect reasonable risk appetite with satisfactory loss experience, and adequate liquidity over the next 12-24 months. We also see a moderately high likelihood that the company would receive extraordinary support from the Jiangsu provincial government, if needed. The outlook on HTIF reflects the outlook on Huatai. We expect HTIF to remain a core subsidiary of Huatai as the group's key overseas operational platform for the next 24 months. We could downgrade Huatai if our assessment of its stand-alone credit profile (SACP) weakens. This could happen if: The company's RAC ratio falls and looks set to stay below 15% with weakened capacity

...A strong client base and continuous investment in information technology and digital platforms will underpin Huatai Securities Co, Ltd.'s (Huatai) strong market position. The company has top-tier rankings in most of its business lines, with a particularly strong edge in retail brokerage. Huatai serves more than 20 million clients, which provides a good foundation for the company's wealth management business. Huatai's capitalization will likely remain very strong, supported by an integrated risk management system. We expect the company's risk-adjusted capital (RAC) ratio to stay above 15% over the next 24 months. This considers Huatai's stable risk appetite and record of adequate earnings. An indication of this is sound risk management during 2022, despite elevated market volatility that year....

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