1, equity financing

Equity financing of securities companies mainly refers to raising capital when securities companies are established or increasing capital and shares, public offering and listing of securities companies, and the use of equity financing by securities companies in the course of operation.

2. Debt financing

Bond issuance financing is a financing method in which securities companies, as debtors, promise creditors to repay the principal and interest in a certain period of time in the future and issue securities. The debt financing methods of securities companies mainly include issuing bonds and bank loans.

3. Bill financing

Bill financing is the oldest financing method in the money market. Commercial paper is a short-term promissory note with a specific term, which is only sold to institutional investors and can be used in the market. The duration can be several months or less, with an average of 25-45 days. Commercial paper is usually sold at a discount at face value, and part of the discount is the interest paid to investors in advance after maturity.

4. Inter-bank borrowing and financing

Inter-bank lending is usually provided by commercial banks to brokers, who borrow money from commercial banks with their short-term government bonds or commercial paper as collateral. The loan period is agreed by both parties, and its purpose is to adjust the position and deal with the temporary fund surplus and deficiency. Interbank lending generally has a short term.

5. Securities repurchase financing

The specific way of securities repurchase financing is: the creditor buys the securities of the brokerage firm and agrees that the brokerage firm will repurchase the securities at the agreed price within a certain period of time. The bid-ask spread is the interest payable by the securities company. Its essence is short-term financing between financial institutions with securities as collateral.

6. Financing by securities finance companies

Securities finance companies are established to provide financing for securities credit transactions. They provide funds and loans for securities issuance, circulation and credit transaction settlement of securities companies and general investors.

Tips: The above information is for reference only.

Reply time: February 2022-18. Please refer to the latest business changes announced by Ping An Bank in official website.