Large Number of Viet Nam Stock Brokers Facing Bankruptcy

Monday, April 21, 2008
The prolonged downturn in the Vietnamese stock market will push some out of 100 securities firms to withdraw out of the competition this year, state media reported.
A bullish stock market in late 2006 and early 2007 led to a boom of securities companies. Many ended the year 2007 with huge profits, such as Bao Viet with VND215 billion, Sacombank Securities VND164 billion, or ACBS VND332 billion.
However, small-scale stock brokers will have to face the severe competition in attracting clients from giants and the negative influence of the country's macro economy.
Some of the weak companies in human resource, IT and financial capacity, may have to announce bankruptcy in late 2008 or in early 2009 after they fail to be merged into big domestic and foreign institutions.
The local stock market has showed no sign of recovery in the short term so far, with VNI closing at 537.58 on April 17.
The State Securities Commission has received over 20 applications to open new brokerage firms. Corporations and groups still expect the market will grow 50 per cent annually in medium and long term.
The Dragon Capital Fund predicted Vietnam's stock market will have over 500 listed firms, one million investment accounts and the market value will reach US$100 billion by 2010. (Vneconomy, VNS)