UBS analyst Pan Hongwen said that innovations come from financial institutions themselves, and regulators cannot be expected to push forward the development of China's brokerages.

Pan also said at the 2014 Innovation Conference on Tuesday that regulators have indicated that the authorities will promote decentralization to make more room for innovation and development.

Recent official documents and the Innovation Conference have focused on innovation guidelines for financial institutions in three aspects - establishing modern investment banks, supporting business and product innovation and promoting regulatory and supervision transition.

"We expect a significant loosening in the regulatory environment for the securities industry, as the authorities shift the supervisory emphasis from approval to information disclosure and supervision,"Pan added.

He said that "based on current reforms and industry development, we believe wealth management, mergers and acquisitions will benefit in the medium and long term. In the near term, we are positive on capital intermediary business development and leverage ratio improvement."

Pan also said he expects more policy announcements concerning stock options, index options, OTC business, derivatives – and more.