[ET Net News Agency, 6 July 2020] Nomura believes a potential merger between two large
investment banks, CITICS (06030) and CSC (06066) cannot be ruled out, especially given
that banks may be allowed to hold brokerage licences.
Although both CITICS and CSC have published clarifications on the issue, the research
house said if the merger materializes, more industry consolidations would follow, which
should reduce competition and improve sector profitability.
For CITICS, Nomura thinks the merger would strengthen its leading position in the
brokerage industry, while the dilution impact (11%) would be manageable, but BVPS would
increase by 21%. (KL)