Huatai Securities, one of China¡¯s largest brokerages, is preparing to start a securities business in Japan as a revival in the country¡¯s financial markets draws firms from around the world.

The Nanjing-based company set up Huatai Securities Japan Preparation in Tokyo last September and has hired former Daiwa Securities Group manager Shinji Shibuya to head the unit, according to filings and people familiar with the matter.

International firms typically create such entities before applying for a brokerage license from Japan¡¯s financial regulator. Huatai Securities CEO Zhou Yi has been overseeing the Japan entity since February as a director, and Chief Financial Officer Jiao Xiaoning is also supervising it, filings show.

Huatai Securities representatives didn¡¯t respond to an email seeking comment.

The development adds to signs of growing activity in the brokerage sector in Japan as the return of inflation spurs investing and corporate governance reforms stimulate dealmaking. That has drawn firms ranging from Spanish banking giant BBVA to Singaporean startup Longbridge Group to tap opportunities in the market.

Huatai plans to offer trading and broking services, according to filings. The firm has been pushing into offshore markets over the years to cater to client demands. Chinese brokerages with such ambitions have also been encouraged by Beijing¡¯s policy goal to cultivate a few top-class investment banks that can compete globally.

The company would become one of the few major Chinese securities firms to set up a unit in Japan. China International Capital obtained a license five years ago in Japan for a securities business and has been modestly profitable, earning ?22 million ($138,000) in 2024.

Meanwhile, Japanese counterparts have had less success with forays into mainland China. Nomura Holdings and Daiwa have been operating units in the country for years without turning a profit. Mizuho Financial Group has been taking steps to build its business in China after receiving approval to set up a brokerage there.

Shibuya worked for about two decades at Daiwa, where he was a director at its China securities subsidiary and headed the firm¡¯s Taiwan business. He became an outside auditor of hotel operator Agora Hospitality Group last year, according to filings.

Huatai¡¯s move comes at a time of renewed tensions between Japan and China. It set up the preparatory unit two months before remarks by Prime Minister Sanae Takaichi over Taiwan prompted China to urge its citizens to avoid traveling to Japan.