Nov. 2 (Bloomberg) -- Citic Securities Co., Asia's largest brokerage by market value, jumped by the 10 percent daily limit on its first day of trading in Shanghai since announcing a $1 billion cross-investment with Bear Stearns Cos.

The Beijing-based company, whose shares have been suspended since Oct. 22, climbed to a record 116.52 yuan at 2:47 p.m. local time, valuing it at $51.7 billion. During the trading halt, Citic Securities also reported a more than eightfold increase in third- quarter profit.

Citic has reaped more revenue from trading fees as Chinese individuals piled into stocks, sending the benchmark CSI 300 index up 170 percent this year. The Bear Stearns deal may bolster Citic's capabilities in areas such as bond issuance and trading in structured products, and help it secure more work advising cross-border mergers involving Chinese companies.

The tie-up ``will globalize Citic Securities and improve its competitiveness,'' said Liang Jing, an analyst at Guotai Junan Securities Co. in Shanghai. ``China needs to cultivate an internationalized investment banking firm to help its companies with mergers and acquisitions abroad.''

Bear Stearns, the investment bank that's been hit the hardest by the global subprime crisis, said Oct. 22 that Citic Securities will spend $1 billion to obtain the equivalent of 6 percent of its shares, while it will invest the same amount in Citic to form a strategic partnership.

Citic Securities shares have soared more than eightfold in the past year, propelling the company past Nomura Holdings Inc. as Asia's largest securities firm by market value. On Nov. 25, it said third-quarter profit jumped to 4.15 billion yuan from a restated 494.7 billion yuan a year earlier.

About 43 percent of Citic Securities' revenue came from buying and selling stocks for clients, making it vulnerable should China's equity market eventually collapse, as forecast by former Federal Reserve Chairman Alan Greenspan this week.

To contact the reporter on this story: Yidi Zhao in Beijing at at yzhao7@bloomberg.net

Last Updated: November 2, 2007 02:56 EDT