Fined 15 million and banned for multiple people, why is this considered Tianfeng Securities' best year?

Login to the Sina Finance APP and search for [Information Disclosure] to see more evaluation levels.

Produced by | Zhongfang Network

Reviewed by | Li Xiaoyan

Recently, Tianfeng Securities received administrative penalty decisions from the securities regulatory bureaus of Hubei and Fujian provinces, focusing on historical issues such as irregular fund flows and omissions in information disclosure during the period of the former private major shareholder. This penalty serves not only as a serious correction of past governance irregularities but also as a critical juncture for the company to completely sever ties with historical risks. Since the entry of Hubei Hongtai Group, Tianfeng Securities has been advancing comprehensive rectification and restructuring of its compliance system with the determination to eradicate deep-rooted issues, laying a solid foundation for its business. Supported by the turnaround in performance, capital reinforcement, and governance upgrades, the company is gradually emerging from the shadows and embarking on a new journey of steady development.

The core of this regulatory penalty points to the company’s irregular operations under the control of the former largest shareholder, Contemporaneous Group, from 2020 to 2022. Investigations revealed that Tianfeng Securities provided over 9 billion yuan in irregular financing to the former shareholders and related parties through various means, including capital transfers, private equity funds, and trust plans, without fulfilling its information disclosure obligations as required. Additionally, there were internal control loopholes such as non-compliance in agency sales and inadequate subsidiary management. Regulatory authorities have issued fines to the company and relevant responsible individuals according to the law, with several former executives being fined and subjected to market entry bans, and some businesses being suspended, demonstrating a clear attitude of strict regulation and enforcement of primary responsibilities in the capital market.

Objectively speaking, this penalty represents a concentrated settlement of historical issues rather than the exposure of new risks. Tianfeng Securities has clearly stated its sincere acceptance and resolute execution of the regulatory decision, marking the complete end of historical legacy risks. More importantly, the irregular financing funds, aside from a small amount of outstanding payments, have been largely recovered, effectively ensuring the safety of funds and relieving the company of its heaviest historical burden. Although the agency sales of private equity and the establishment of new products by private equity subsidiaries face short-term suspension, creating temporary pressure on the transformation of wealth management and asset management businesses, this compliance pain is precisely the necessary path for the company to return to standardized operations and rebuild market trust.

The entry of state-owned capital and comprehensive empowerment is the core support for Tianfeng Securities’ breakthrough and rebirth. In 2023, Hubei Hongtai Group, a state-owned enterprise in Hubei Province, officially became the controlling shareholder of the company, marking the complete exit of the Contemporaneous system and completing a fundamental transformation from private aggressive expansion to state-owned standardized operations. Hongtai Group adheres to the strategy of “operating, repairing, and transforming simultaneously,” injecting strong momentum into Tianfeng Securities from three major dimensions: equity, governance, and capital. At the equity level, it completely severs ties with the previous irregular shareholders, solidifying the governance foundation of state-owned control; at the governance level, it promotes a complete overhaul of the executive team, establishes a sound pre-research system for the Party Committee and a “Three Major and One Large” decision-making system, clarifying the boundaries of responsibilities to fundamentally prevent undue interference from major shareholders; at the capital level, it commits to fully subscribing to 4 billion yuan in the company’s private placement by 2025, continuously supplementing core capital and significantly enhancing the company’s risk resistance and business expansion capabilities.

Under the guidance of state-owned capital, Tianfeng Securities has embarked on a thorough transformation of compliance and internal controls. The company uses this penalty as a warning to build a penetrating compliance risk control system covering the entire business process, all levels of subsidiaries, and all positions, embedding compliance requirements into every aspect of operational decision-making, business conduct, and performance evaluation. For weak links such as agency sales, related transactions, and information disclosure, special review mechanisms are established to strengthen prevention before events, control during events, and accountability after events, thoroughly addressing historical internal control shortcomings. At the same time, it comprehensively strengthens subsidiary management, standardizes private equity operations, and ensures that various businesses operate in compliance within the regulatory framework, safeguarding the operational lifeline with compliance bottom lines.

After rectification and adjustment, Tianfeng Securities’ operating fundamentals have shown a clear recovery trend, with a performance turning point officially established. In 2022, the company reported a net loss of 1.503 billion yuan, a slight loss again in 2024, while the 2025 performance forecast indicates an expected net profit attributable to shareholders of 125 million to 185 million yuan, successfully turning a profit. In the first three quarters of 2025, the company achieved operating revenue of 2.112 billion yuan, a year-on-year increase of 57.53%, with a net profit attributable to shareholders of 153 million yuan, continuously releasing operational vitality. From the business structure perspective, self-operated investment business income has significantly rebounded, becoming the core pillar of the performance reversal; traditional businesses such as bond underwriting and securities brokerage are steadily recovering, and research business still maintains a ranking among the top 15 in industry commission revenue, gradually showing resilience in core business.

Although traditional businesses currently face pressure, the transformation of wealth management is temporarily hindered due to the suspension of private equity agency sales, and the asset management business is limited in fundraising capability due to the suspension of products by Tianfeng Tianrui, while the stability of the core analyst team needs to be consolidated, these challenges are all stage-specific issues during the rectification period. In the long run, as the compliance system improves, capital strength increases, and business structure optimizes, Tianfeng Securities’ core competitiveness will gradually recover. With the resource support of Hubei Hongtai Group, the company can deeply align with the development needs of the regional real economy, expanding space in areas such as equity financing, bond underwriting, and industrial services, focusing on advantageous sectors to build differentiated competitiveness, gradually reducing reliance on investment income, and establishing a robust and sustainable profit model.

For the capital market, the implementation of this penalty signifies that “bad news is now fully priced in,” and the market’s wait-and-see sentiment is expected to gradually dissipate. For a long time, Tianfeng Securities’ stock price has been dragged down by historical risks, remaining at a low point in its sector, but as historical burdens are lifted, rectification effects become evident, and performance continues to recover, the company’s valuation repair has a solid foundation. More importantly, under the governance standards, stable capital, and accountability of state-owned control, investor trust will gradually be reshaped, creating a favorable market environment for the company’s long-term development.

The securities industry is one that operates on credit and risk; compliance is the foundation of existence, and stability is the basis for development. The experience of Tianfeng Securities reflects the governance irregularities and risk control failures during the private control period of some securities firms, as well as a typical example of rectification and rebirth under state-owned control. The thorough resolution of the 9 billion yuan irregular issues not only marks Tianfeng Securities’ transformation but also provides profound insights for the industry to enhance corporate governance, strengthen internal compliance, and prevent risk transmission from major shareholders.

Standing at a new historical starting point, Tianfeng Securities has completed key leaps in clearing historical risks, restructuring governance systems, and strengthening capital strength. Short-term business pressure does not alter the long-term positive trend, and compliance pain is giving rise to new opportunities for high-quality development. In the future, under the guidance of the state-owned controlling shareholder, as long as the company adheres to compliance bottom lines, focuses on core businesses, optimizes service capabilities, and continuously rewards investors, Tianfeng Securities will surely emerge from the historical shadows, achieving rebirth and steady progress in the process of serving the real economy and supporting the high-quality development of the capital market.

Access a wealth of information and precise interpretations, all on the Sina Finance APP.