CITIC Securities Co, China's second-biggest brokerage by market value, said yesterday that first-half profit growth slowed to 13 percent as the country's stock market became the world's worst performing major gauge.

Net income rose to 4.8 billion yuan (US$699 million) in the six months ended on June 30 from a year earlier, according to a statement from the Beijing-based securities company. Earnings per share dropped 49 percent to 0.72 yuan after an increase in outstanding share capital. The company's year-earlier net income rose fivefold.

China's equities slump has pressured trading, fee income and underwriting at state-controlled CITIC Securities and rival firms such as Haitong Securities Co. CITIC has lost more than half its market value this year as China's stock market has gone from the world's best performer in 2007 to become the worst.

"It's clear that trading volumes and commission rates are decreasing, so the entire brokerage industry's profit is dropping," Shen Wei, a Shanghai-based analyst at Everbright Securities Co, told Bloomberg News.

State-controlled CITIC earned about 4.6 billion yuan, or 42 percent of its revenue, from trading shares for its clients, 30 percent less than the 6.6 billion yuan it made from commissions a year earlier.

(Shanghai Daily August 10, 2008)