The number of Vietnam’s securities companies is expected to fall by two thirds from 105 currently to just 30 with undergoing restructuring process and many companies are in trouble, however, no securities company has declared the bankruptcy.
Many local securities companies have been in trouble including SME, HSSC, TSS and DDS, SBS for their poor performance and/or default cases.
Earlier, the Hanoi Stock Exchange announced a list of securities companies which are not eligible for margin trading by June 30, 2012, which includes APS, APG, SHS, PSI, SVS and many others. The companies have also been given warnings for the unprofitable business performance in 2011 and high accumulative loss.
Insiders said as the State Securities Commission may not grant new business licenses in the sector and
decided to reduce the number of companies from 105 now to 30, the answer lies in the intangible value of the existing license
Securities companies understand well that it is nearly impossible to obtain an operating license now and the near future therefore, the securities companies still try to stay alive hoping to sell their license later.
The excuse was reasonable especially after the watchdog agency gave green light for 100 percent foreign owned securities companies.
Pham The Anh, Chief Economist of the Thang Long Securities Company, said that securities companies still can see the opportunities ahead when the crisis period is over and they keep surviving as long as they can.
Many securities companies have been backed by commercial banks; therefore, they are still in a position to maintain their operation despite the bad business performance and “Finance groups should not operate without securities companies. Therefore, they would keep injecting money in securities companies,” Anh said.