Kinh Bac plans to raise 106 million USD

Tuesday, April 29, 2008
The listed firm Kinh Bac Urban Development Joint Stock Co is planning to offer more shares this year to hike its charter capital to 1.7 trillion VND (106 million USD).
Chairman Dang Thanh Tam made the announcement at a recent Kinh Bac shareholder meeting, saying the company was aiming to make over 1.18 trillion VND (74 million USD) in revenue and 611 trillion VND (38.2 million USD) in after tax profit, and pay a dividend of at least 30% in 2008. He also announced that the company would pay a 2007 dividend of 43% in shares.
“A growth rate based on a firm foundation will help the company have enough financial capacity to be ready for large projects in the future,” the chairman noted.Current projects the company is working on include a 100 million USD plan to expand Bac Ninh province’s Que Vo industrial complex to over 600ha, a 200 million USD Yen Phong industrial zone project in the first phase in Bac Ninh and the Phuc Ninh urban zone project coming in at 200 million USD.
This year, the company will joint hands with Taiwanese Foxconn Group to develop the Trang Cat high-tech and new urban area complex in the northern port city of Hai Phong , along with other projects.
Kinh Bac, an affiliate of Saigon Invest Group, specialises in real estate development, trade, financial services, infrastructure construction, investment consulting, power generation and mining. (VNA)

Vinaconex to sell stakes in cement plants to foreign investors

Tuesday, April 29, 2008
Viet Nam Construction and Import-Export Corp., a state-owned construction company, plans to sell an additional 20% stake in two cement plants to overseas investors to help fund expansion.
The company will sell the stake “to foreign strategic partners who commit to retaining the stake for at least three years and support us in terms of technology, finance, personnel and market expansion,” Phan Vu Anh, a spokesman for Vinaconex, as the company is known, said by telephone from Hanoi Monday.
Vinaconex spent VND4.7 trillion (US$294 million) to build the plants in Quang Ninh and Ba Ria-Vung Tau provinces, according to a statement on the Hanoi-based company's website.
The plants had a combined capacity of 2.3 million metric tons a year, Anh said.
International investors already owned about 10% of the plants, he said, declining to name them.
”The corporation has many big projects using cement from theplants, and producing cement is still profit-making,'' he said.
The production capacity in Viet Nam could exceed demand in five years, he said.
Vinaconex plans to list its shares on the Hanoi Securities Trading Center this year, according to its website. (Bloomberg)

April 29, VN Index surges, HaSTC Index slumps

Tuesday, April 29, 2008
Ending the last trading session of April, the 1776th trading session of the Vietnamese stock market, the Ho Chi Minh City Stock Exchange (HOSE) kept its increasing impetus on the stock market as the VN Index rose 2.94 points or 0.56% to 522.36 pts with the total matching order trade of over 9.5 million shares and fund certificates worth over 403 billion dong, marking the second consecutively increasing session on the stock market.
Among 154 shares and fund certificates being listed on the southern bourse, the stock market saw 65 shares increasing while 18 others stood still at the reference price, 71 shares decreasing. Of which, some 50 share codes reached the ceiling price and 60 others fell to floor price.
Particularly, STB lost 600 dong to 33,500 dong, SSI slipped 1,000 to 49,000 dong, FPT down 1,500 to 81,000 dong per share.
Others reached the ceiling price including VNM, VPL and PVD up 2,000 dong to 134,000 dong, 117,000 dong and 117,000 dong, DPM, HPG and ITA up 1,000 dong, VIC leaped 1,500 dong and PPC jumped 700 dong per share.
STB reached the biggest trading volume with 1,769,600 shares, DPM with 1,279,060, PRUBF1 with 431,120, PPC with 380,420 and others like VSH, FPT, SSI and HPG.
Foreign investors bought 79 shares with the total volume of 2,669,180 shares. DPM kept the first place with 658,350 shares, PPC with 299,080. VSH with 226,710, PVD with 141,270 and VIC with 136,850 shares.
Conversely, the Hanoi Securities Trading Center (HaSTC) today April 29 slumped on the stock market as the HaSTC Index dropped 2.00 points or 1.17% to end at 169.11 pts with the total market trade of 3,255,900 shares worth nearly 113 billion dong.
Amongst 135 listed shares on the northern bourse, the stock market saw 59 shares increasing while 65 others decreasing, four shares stood still and seven shares with no trades.
Four shares stood still including DSC, SIC, SJM and XMC.
Seven shares with no trade were CTB, HSC, HUT, KMF, LBE, NPS and VE9.
MIC was the biggest gainer when adding 2,700 dong and followed by SCJ up 1,800 dong and VTS leaped 1,000 dong. Others increased below 1,000 dong per share.
S99 and SD2 showed the strongest decrease when losing 1,600 dong and followed by SD7 lost 1,500 dong, HLY and SDA down 1,300, BVS slipped 1,200 and L62, PSC, PVC and SNG dropped 1,000 dong per share.
DBC took the pole place in trading volume with 327,400 shares, followed by KLS with 204,200 shares, HNM with 185,600 and ACB with 158,700 shares being traded.

Vietnam Stock Market News: Viet Nam to raise dong deposit rate cap to 12 pct

Vietnam Stock Market News: Viet Nam to raise dong deposit rate cap to 12 pct

SSC To Halt Licensing New Securities, Fund Management Cos

Monday, April 28, 2008
The State Securities Commission (SSC) said Monday that it has decided to temporarily halt issuing licenses to new securities and fund management companies as part of efforts to boost the industry's performance.
"In order to support the stable development of the stock market, the State Securities Commission will temporarily halt the reception of applications for setting up new securities and fund management companies," the SSC said on its Web site.
The SSC's move follows the government's asking last week of all state-owned companies to review their operations; these entities have invested VND23.34 trillion ($1.45 billion) in securities and fund management companies in recent months, according to analysts.
"The SSC's decision is a right move because it will help existing companies to improve operations in terms of service quality, rather than by simply slashing service fees," said Phan Hong Quan, a director of Hanoi-based EuroCapital Securities.
"Viet Nam's stock market is relatively small, and licensing too many securities companies has caused unfair competition," Quan told Dow Jones Newswires.
"Many local brokerage firms, including EuroCapital Securities, are seeking foreign investors for their expertise and to help boost operations," Quan said.
There are currently 87 securities companies and 30 fund management firms licensed by the SSC, but not all of them have started operations.
Quan forecast that about half of the existing securities companies will soon close their offices because of losses, following a 44% plunge in domestic stocks so far this year. The benchmark domestic share index has fallen more than 55% since its peak in March 2007. (Dow Jones)

April 28, Foreigners Net Buyers Of VND131 Billion Of Shares

Monday, April 28, 2008 of VND131 billion ($8.2 million) of Vietnamese stocks Monday, out of a total of VND289 billion traded, the Ho Chi Minh Securities Trading Center said.
Volume was 8.9 million shares, with foreigners accounting for 32.9%, according to the stock market operator. (Dow Jones)

Viet Nam to raise dong deposit rate cap to 12 pct

Monday, April 28, 2008
Commercial banks in Viet Nam will raise the ceiling rate on dong deposits with a maturity of six months or longer to 12% from 11%, effective Tuesday, the Viet Nam Banks Association said on Monday, a move that should help smaller lenders.

The ceiling for interest on deposits of less than six months will be raised to 11.5 percent from 11 percent, the association said in a statement, citing agreements by commercial banks at meetings in Hanoi and Ho Chi Minh City last week.

It said banks should have plans to implement the rates as agreed among members of the association "in order to stabilise the market's interest rate level, to limit funds being shifted from one bank to another".

The authorities are apparently worried that smaller banks may have trouble attracting deposits, which would lead to liquidity problems at a time when demand for loans remains strong and might prompt the need for central bank aid.

The cap was imposed as a way of stopping money being moved between accounts as banks outbid each other for deposits, a practice that was working against official efforts to tighten liquidity to fight inflation.

Annual inflation in April jumped to 21.42%, the sixth consecutive month of double-digit price rises.

The association said in its statement that the higher deposit rate should help protect depositors against rising inflation.

The central bank said last week that apart from injecting cash via open market operations, it would step up lending, especially to smaller banks, to boost their liquidity.

Viet Nam could ease its restrictions in the next few months. (Reuters)

Banks not allowed to offer promotion programmes?

Monday, April 28, 2008
The Ministry of Industry and Trade and the State Bank of Viet Nam have agreed not to grant more licences to commercial banks to carry out promotion programmes at this moment, in order to protect the current ceiling interest rate, according to Secretary General of the Viet Nam Banking Association Duong Thu Huong.
Stopping promotion programmes to maintain ceiling interest rate
Huong said that banks can continue the promotion programmes for which they got licences before. However, they will not be able to launch other promotion programmes in order to attract capital.

Promotion programmes have been used by banks as an effective tool to call for more capital from the public, especially as they are ordered not to offer deposit interest rates higher than 11% per annum. Banks have been trying to dodge the regulations by offering attractive gifts or bonus interest rates to clients, which have made actual deposit interest rates higher than 11% per annum.

However, the State Bank of Viet Nam and VNBA, who believe that high deposit interest rates will harm the national economy at this moment, have decided that promotion programmes should not continue.

Depositors want promotion programmes

Nguyen Thi Minh, a retired woman in district 3 in HCM City, said that with the interest rates offered by commercial banks all the same, the thing that helps her make a decision about which bank to deposit money in are promotion programmes, which means that promotion programme show the competitiveness of banks at this moment.

A recent survey made by a big joint stock bank shows that attractive promotion programmes can sway up to 50% of depositors, especially clients between the ages of 35-60.

That explains why the decision to stop licencing promotion programmes has been facing strong opposition from banks.

Stopping licencing promotion programmes? It’s illegal!

According to experts, VNBA setting the 11% ceiling interest rate proves to come contrary to the Competition Law, and may cause depositors losses.

If VNBA and the Ministry of Industry and Trade plan to stop licencing promotion programmes, they will, once again, be violating the rules of market liberalisation. The experts say that the two organs should think through the legal considerations before stopping licencing promotion programmes.

Lawyer Nguyen Van Hau, Head of the Information and Propaganda Division under the HCM City Bar Association, said that the State Bank of Viet Nam and the Vietnam Trade Promotion Agency would violate laws if they stopped licencing promotion programmes.

Promotion activities are considered legal activities under the Commercial Law. Competent agencies only have the right to prohibit promotion programmes if promotion programmes runners violate current regulations. If the prohibition by state management agencies can cause losses to enterprises, they can initiate legal proceedings against the agencies. (Tuoi tre)

Tien Phong Plastic pays 30% dividend

Monday, April 28, 2008
Shareholders of the Thieu nien tien phong Plastic JSC (Tifoplast) agreed on a 30% dividend for 2007 at the annual shareholders’ meeting on April 26.
Last year, the company’s total revenue hit VND 905 billion, up 12.9% compared to the targeted figure with a total production of over 33,000 tonnes, up 15% year-on-year.
Total after-tax profit hit VND 125.4 billion, up 5.5% compared to 2006’s figure.
According to Hoang Van Ngoc, chairman of the Management Board and General Director of Tifoplast, last year the company poured strong investment in modernising equipment and increasing production capacity from 30,000 tonnes a year in 2006 to 35,000 a year in 2007. At the same time, the company has also expanded its distribution network with over 200 sale agents and thousands of retail shops from Da Nang northwards.
Last October, the company was licensed to build a factory to produce plastic pipe in Binh Duong and is applying for construction of a similar plant in Vientiane, Laos. The company will also move part of its current factory in inner Haiphong city to the suburban areas to expand production.

This year, the company targets a total turnover of VND 1 trillion; total production of 36,000 tonnes and an after-tax profit of VND 140 billion. (Nhan Dan)

April 28, Stock market recovers after six continuous decreases

Monday, April 28, 2008
The domestic stock market recovered on the first trading session of the week as the market indicator of the southern bourse ended its string of six consecutive decreases while the HASTC-Index of the northern bourse saw the second increase in a row. Many stocks listed on both bourses gained on today’s session. Trading volumes were also improved.

Ending the trading session today April 28, the 1775th trading session of the Vietnamese stock market, the Ho Chi Minh City Stock Exchange (HOSE) opened a new week by seeing a rally on the stock market as the VN Index regained 3.54 points or 0.68% to 519.42 pts with the total matching order trade of nearly nine million shares and fund certificates worth over 382.5 billion dong, closing six consecutively decreasing sessions on the stock market.

Among 154 shares and fund certificates being listed on the southern bourse, the stock market saw 90 shares increasing while 10 others stood still at the comparative prices, 53 shares decreasing and one share with no trade namely BTC of Binh Trieu Construction and Mechanic Joint Stock Co.

Total order matching trading volume was over 8.9 million shares and fund certificates worth VND 383 billion.

SSI lost 1,000 dong to 50,000 dong per share, FPT slipped 1,500 to 82,500, STB dropped 600 to 34,100 dong per share.

Meanwhile, some others reaching the ceiling price included VNM, VPL, PVD up 2,000 dong to 132,000 dong, 115,000 dong and 115,000 dong per share, DPM, HPG and ITA leaped 1,000 dong to 52,500 dong, 62,000 dong and 71,000 dong, VIC jumped 1,500 dong and PPC bounced 700 dong per share.

STB kept the pole place in trading volume with 1,789,050 shares, DPM followed with over one million shares, SSI with 589,730 shares, FPT with 458,890 shares, VHG with 361,920 shares and others like VFMVF1, DPR, VSH and PRUBF1.

Foreign investors bought 69 share codes with the total volume of over 3.2 million shares worth VND 176 billion while sold only over 500,000 units worth VND 27 billion. DPM reached the biggest trading volume with 780,480 shares, SSI with 356,650 shares, FPT with 227,110 and VSH with 173,280 shares.

Similarly, the Hanoi Securities Trading Center (HaSTC) today April 28 surged on the stock market as the HaSTC Index added 2.16 points or 1.28% to end at 171.11 pts with the total market trade of 3,659,500 shares worth over 135 billion dong.

Amongst 135 listed shares on the northern bourse, the stock market saw 71 shares increasing while 47 others decreasing, nine shares stood still and eight shares with no trades.
Nine shares stood still including BTH, CJC, DCS, HEV, SJE, TJC, TPH, TXM and XMC.

Eight others with no trade were C92, CTB, HSC, HUT, NPS, PSC, VE9 and VTL.

MIC was the biggest gainer as adding 2,700 dong and followed by ACB and SCJ up 2,000 dong per share, others increased below 2,000 dong per share.

SD2 was the strongest decliner when losing 1,600 dong and followed by SD7 slipped 1,500 dong, SDA sropped 1,300 dong, CDC slipped 1,200 dong and BVS and L62 lost 1,000 dong. Others fell below 1,000 dong per share.

KLS took the first position in trading volume with 620,600 shares, followed by ACB with 341,200 shares, PVS with 226,600, DBC with 194,500 shares, PVI with 183,600 and HPC with 102,500. Others reached the trading volume of below 100,000 shares.

Power station approved for Mekong Delta

Monday, April 28, 2008
The Tan Tao Group has received approval for blueprints for a new power station, industrial zone and a new urban area in Kien Luong District in the Mekong Delta province of Kien Giang.

The Tan Tao chairwoman, Dang Thi Hoang Yen, said relevant agencies and ministries had agreed with the designs made by the group in cooperation with the provincial government.

The central government had already decided to build the 600-hectare, 4,400-megawatt power station.

The group was also assigned by Prime Minister Nguyen Tan Dung to join hands with the local government to design a deep-water port in the district.

Most Asian stock markets show marginal gains

Monday, April 28, 2008
Asian markets gained marginally on Monday as growing optimism about the US economy and a more stable dollar lifted Tokyo's index to a two-month high.

Still, many traders and investors remain cautious ahead earnings reports and key US economic data this week, as well as and central bank meetings on interest rate policies in the United States and Japan.

Optimism about the American financial sector's health has improved market sentiment, but some investors are wary ``before the earnings season gets into full swing,'' said Shinko Securities' strategist Tsuyoshi Segawa in Tokyo, where the Nikkei 225 stock index gained 30.9 points, or 0.2%, to 13,894.37.

Japanese financial stocks soared after gains in their counterparts on Wall Street last week. Mitsubishi UFJ Financial Group jumped 10%. Mizuho Financial Group closed up 9.5%, while Shinsei Bank jumped 13.5%.
The dollar's stability against the yen also buoyed exporter shares. Honda Motor Co. rose 3.0%, Nissan Motor added 2.8% and Mazda Motor shot up 7.9%.

In Hong Kong, investors sought the safety of utility companies amid the uncertainty. The blue-chip Hang Seng Index rose 0.6%, to 25,666.29.

``Several key data to be released this week may confirm the US economy is in recession,'' said Alex Tang, research director at Core Pacific Yamaichi International. ``I don't expect to see any positive catalyst from the coming economic indicators.''

The US is reporting gross domestic product and consumer confidence date this week, and many in the market expect the US Federal Reserve to cut its key interest rate another quarter point. The Fed has now cut its federal funds rate six times since September, and last cut the rate 75 basis points in mid-March.

Utility firms led Hong Kong's blue-chip gains. Hong Kong & China Gas, the city's dominant gas supplier, climbed 1.8%. CLP added 0.6%. Hongkong Electric rose 0.4%.

China Life Insurance, China's largest life insurer by premiums, fell 1.6% after it reported a 61% drop in first-quarter net profit on lower investment income.

Oil refiner Sinopec fell 2.7%. Its first-quarter net profit fell 69% from a year earlier, as a government subsidy couldn't fully offset surging oil costs. The poor earnings of Sinopec also pulled down the Shanghai market, where the benchmark index fell 2.3% to 3,474.72.

``The key focus of Monday's session was oil refiners, following the release of Sinopec's weak first-quarter earnings. The fact that oil prices hit a record high made a bad picture worse,'' said TX Investment analyst Qiu Yanying.

Sinopec's Shanghai shares fell 4.4%. And PetroChina, the publicly traded arm of China's biggest oil company, China National Petroleum Corp., fell 4.3%.

Chinese oil companies have suffered heavy losses on refining due to government controls that bar them from passing on record crude prices to consumers. Companies have been subsidizing their refining losses with profits from their drilling units.

New York crude oil futures hit a record high of US$119.93 a barrel on Monday after the weekend shut-in of a pipeline system that carries 700,000 barrels of North Sea crude a day to the UK.

Vietcombank to increase dividend to shareholders

Tuesday, April 29, 2008
Vietcombank's first shareholders' meeting was held in Hanoi on April 26 with the nomination of director board, supervision board for the term of 2008-2013, the approval on operation regulations, business orientation and plans in 2008.

Accordingly, the bank's director board includes seven members and the supervision board has five members with the wage equalling to 0.36% of its after-tax profit.

Speaking at the meeting, the bank's general director and chair Nguyen Phuoc Thanh pointed out changes and high risks of the domestic banking and stock market. This year the business safety will be given high priorities with targets of maintaining the bad debt ratio of 2.6% and the growth rate of below 30%. In addition, the bank plans to add 905 billion dong to the risk prevention fund, bringing the total figure to 2.321 trillion dong for particular risk prevention fund and 810 billion dong for general risk prevention fund.

By December 31, 2008, Vietcombank's total asset could be 211.084 trillion dong, rising 7.72% year-on-year while the revenue is targeted at 4.537 trillion dong, up 13.94% yoy, revenue from service and other activities estimated at 2.339 trillion dong, up 6.97% and a dividend of 12.08%.

Vietcombank expects to become a financial holdings group ranking among Asia's top 50-70 largest ones in the period of 2015-2020 with the capital scope of over US$30 billion and total ownership capital of about US$2 billion by 2015.

The meeting also passed the plan to select foreign strategic partners and the roadmap of domestic and overseas listings. (VNA)

PetroVietnam Drilling to pay 2007 dividend

Tuesday, April 29, 2008
PetroVietnam Drilling and Well Services Joint Stock Co (PV Drilling) recently announced that it would pay 2007 dividend of 18.51% in cash on May 30.
The registration deadline is on May 12.
The ex-interest date is on May 8.
PV Drilling plans to offer 20,027,946 ordinary shares at 10,000 dong par to the existing shareholders to pay dividend of 20% in shares on June 12.

Techcombank launches "super lucky saving" programme

Tuesday, April 29, 2008
Viet Nam Technological and Commercial Joint Stock Bank (Techcombank) recently launched "super lucky saving" programme lasting from April 23 to 22 July with the total value of nearly three billion dong.
The programme is for customers with saving accounts of from 10 million dong or US$1,000.
In addition, customers when joining this programme will receive 50% of registration fee for added service package including Techcombank Visa Debit card and internet banking service.

Cavico infrastructure construction firm posts 889.778b dong in total asset

Tuesday, April 29, 2008
Cavico Infrastructure Construction Joint Stock Co recently released the 2007 fiscal year with the total asset of more than 889.778 billion dong, total revenue from sales and service provision at 46.193 billion dong, the combined profit from sales and service provision of over 14.029 billion dong.

Also, the firm achieved about 1.043 billion dong from financial activities, 10.489 billion dong in net business profit, 3.6 billion dong in other profits, 14.091 billion dong in total pre-tax profit, and EPS of 3,361 dong.

It spent 1.102 billion dong on financial cost, 3.481 billion dong on corporate administration and 799.593 million dong on other costs. (DTCK)

Strong foreign buys save market from further plunge

Monday, April 28, 2008
The VN-Index fell for five consecutive sessions last week, losing a total of 19.04 points to close on Friday at 515.88. Trading volume averaged under six million shares per day, with value reaching a cumulative VND1.32 trillion (US$82.5 million), both figures comparable to the previous week.

An analyst from Kim Long Securities Co, who asked to remain anonymous, said that the VN-Index was saved from plunging further last week by the net buying of foreign investors.

Foreign investors last week picked up a total 8.73 million shares, worth nearly VND508 billion ($31.75 million). This accounted for about 38 per cent of the market’s entire value during the week. Meanwhile, they sold only 952,670 shares, totalling about VND60 billion.

So far this month, they’ve spent VND2.18 trillion to purchase 35.3 million shares, while selling only 7.8 million shares, worth VND522 billion.

"It’s notable than foreign investors have bailed out the market and kept it from plunging further," said the analyst. "However, these days may be numbered because, if the market continues its descent, overseas investors will also likely sell shares to cut losses."

The market slowdown has also had a big impact on domestic brokerage houses, who have seen their income from trading commissions dry up. To halt further dilution of a shrinking market, representatives of the Ministry of Finance and the State Securities Commission held a closed-door meeting last week in which they decided to halt granting operating licensces to new brokerage houses and fund management companies.

After the meeting, Deputy Minister of FinanceTran Xuan Ha said concerned agencies would seek to restructure to the stock market to ensure sustainable development of both the stock exchange and the over-the-counter (OTC) market.

Authorities would also get tougher on violations by brokerages to create more favourable conditions for the market to develop strongly, he said.

The establishment of a formal bond market was also still in the works, Ha indicated.

In Ha Noi over the past week, the Ha Noi Securities Trading Centre witnessed four down sessions before the HASTC-Index rose on Friday. For the week as a whole, the index lost 8.38 points to close at 168.95.

Total volume for the week on the northern bourse was 14.67 million shares, with a value of VND588 billion ($36.75 million). (VNS)

Thanh Cong Textile maker sets sights on real estate, securities business

Monday, April 28, 2008
The Thanh Cong Textile Garment-Investment-Trading Joint Stock Company (TCM) which is listed on the HCM City Stock Exchange plans to expand its business into real estate and securities brokerage.

Chairman Dinh Cong Hung announced at last week’s shareholder meeting that construction of the Thanh Cong Tower apartment complex would begin on a 10,000sq.m. plot in Ho Chi Minh City ’s Tan Phu district before June.

Also in Tan Phu district, the construction of the 6.4ha Thanh Cong Tower 2 is set to begin next year. It will include houses, a vocational training school, a conference centre, office buildings and a cultural centre.

Other residential projects are in the works, including Thanh Cong Tower 3 in district 4, Bui Huu Nghia apartment building in district 5 and a 20ha service and commercial area in the northern Bac Ninh province.

Based in HCM City , TCM is cooperating with several partners on a 200ha industrial park and a 3ha residential area in neighbouring Long An province, a 17ha bonded warehouse at Phu My Port in Ba Ria – Vung Tau province and a 10ha resort in the coastal province of Phan Thiet .

The Thanh Cong General Clinic, on Thanh Cong Tower 2’s grounds, will begin operation later this quarter It is capable of receiving 1,000 patients a day.

In May, Thanh Cong Securities company will become a trading member of the HCM City Stock Exchange.

The company intends to issue 10 million convertible bonds with a face value of 100,000 VND each to raise funds for its real estate projects this year alone. (VNA)

ABBank sets up training centre

Tuesday, April 29, 2008
An Binh Commercial Joint Stock Bank (ABBank) recently officially established a training centre specialising in building development strategies, organising training activities and developing human resources for its nationwide system.
This year, the centre will focus on three big programmes namely the programme to train branch directors, the programme to train profession and customer care skills for all staff.
In addition, ABBank also plans to invite prestigious foreign partners to teach and shares their experience to catch modern management technology in the world.

Gold trading floor out of control

Tuesday, April 29, 2008
In Viet Nam, the model of gold trading floor is showing the efficiency of capital mobilisation from businesses. However, no legal documents on controlling the gold trading floor’s operations has been created so far.

After the success of the ACB gold trading floor, the Viet Nam Gold Trading Association (VGTA) and its member businesses are accelerating the establishment of more trading floors.

At least two more new floors of its kinds will open in Hanoi in June.

Judging from the rapid development of the new form of business, VGAT Vice President Dinh Nho Bang said it is essential to create operational regulations to make gold trading floors run effectively. The VGTA has asked the Sate Bank of Viet Nam (SBV) to create a legal framework for gold trading floors as well as to-be-established gold trading centres in the near future in order to protect investors’ interests.

Under Decree No 160 on the SBV’s management, the SBV is entitled to manage gold export-import activities without controlling the gold market in general. Hence, it can be said that State regulations on the establishment and control of gold trading floors’ activities lack transparency, including the opening of gold trading accounts.

According to Luu Quang Dien, a member from the Executive Board and managing director of the Hanoi SJC Company, gold trading companies should joins hands with banks to maintain the smooth operations of the trading floors. In reality, when investors want to withdraw a large volume of gold, banks fail to meet immediate demand as they have to spend a certain period of time sourcing the gold.

To make gold trading floor operation move, apart from building strict legal regulations, it is important to develop a contingent of capable transaction staff.

Currently, gold prices are updated regularly through the media. Those who have a thorough grasp of the rules, will earn a high profit otherwise investors can face a risk of losing their investments.

Luu Quang Dien, Manager of SJC Hanoi, said that a gold trading floor would have great potential because physical gold trading is not very safe and requires a great amount of gold. Meanwhile, the virtual business of a gold trading floor offers convenience, safety and wide trading range for investors. Therefore, gold trading floors are very popular abroad.

Both investors and economists said gold trading in this way is even simpler than stock trading because the former requires a single code and investors have to consider and make their own decisions.

However, the floor has its own complexity. In the stock market, the increases occur between floor and ceiling prices within the domestic market but gold prices fluctuate unpredictably according to world prices. The transaction order is effective only in a day.

This business could bring huge profits but also cause great losses.

Mr Dien added that there has been a variance in terms of the trading in Hanoi and HCM City. The Hanoi gold trading market is not very large but has potential investors, most of whom are located in Hanoi, Haiphong, Quang Ninh and Lang Son. He predicted the great trading amount in the future will be concentrated in the northern region, not in the southern region.

In the context of unstable gold prices, gold trading floors will help investors reduce their risks and gold price gaps by responding to every change on the market.

In developed countries, gold trading via accounts makes up more than 60 percent of the total (the rest is physical gold trading.) Most of their enterprises are involved in gold trading because this helps them mobilize capital effectively.

In order to join these floors, investors only need to have accounts in banks with initial fixed capital. The more deposit, the more trading chances they have.

The minimum capital for each investor will be stipulated by floor. At ACB floor, it is 50 taels. In the coming period, the corresponding figures in new floors are expected to be reduced by 10 taels to attract more investors.

Mr Dien said Hanoi currently has no standard gold trading floor. In June, VATA will launch a new floor at Rubby Plaza in Le Ngoc Han street. This floor will open during the peak hours of the world gold market (until 9pm Viet Nam time). (VOV)

SBV implementing too rigid monetary policies: expert

Monday, April 28, 2008
Prof Dr Tran Ngoc Tho of the HCM City Economics University, said that the uncertain monetary market in recent days has been putting big difficulties on businesses. He has called for suitable policies in order to ease difficulties for businesses.

He said:

In the last several months, people have been suffering a lot from the fluctuations on the monetary market. The US$ price dropped unexpectedly and then went up unexpectedly. The market had an excess of foreign currencies, and then suddenly was short of foreign currencies. The interest rate unexpectedly jumped to 12-13% per annum. These uncertainties all have badly affected people and businesses.

Is that the price Viet Nam has to pay to curb inflation?

When applying measures to curb inflation, there are always difficulties for some groups. However, the noteworthy thing is that the above fluctuations originated from unclear signs given by the State Bank of Viet Nam.

Let’s take an example. The VND/US$ exchange rate dropped dramatically and then surged sharply after the State Bank of Viet Nam announced its intention to raise the VND/US$ exchange rate.

As a result, people who had dollars in hand rushed to sell them. They thought that the superfluous supply of dollars would lead to the fall of the dollar price. However, the reality was far different from that. Viet Nam has been witnessing big trade deficits for more than 10 years; therefore, it will never happen that the country will have dollars in excess.

An interest rate race among banks broke out after the interest rates on the interbank market surged to a level never before seen in history, over 30% per annum. In order to extinguish the interest rate war, the State Bank of Viet Nam imposed the ceiling interest rate scheme, a solution that has not been welcomed.

However, the State Bank of Viet Nam has been trying its best to stabilise the market with many solutions taken…

Only several commercial banks have met with difficulties and if the State Bank had found the solutions to settle the problems of these few banks, the market would not be as chaotic as now. It is true that the central bank tried to intervene in the market and pumped money into circulation, but the money did not get to the banks that needed money. The State Bank only finances commercial banks if banks have bonds; banks that don’t have bonds can’t get loans.

Imagine that a borrower only has a motorbike, but the lender (in this case the central bank) demands a house as a mortgage asset for the loan. Therefore, the borrower and lender cannot reach an agreement.

I think that the State Bank should be more flexible in this case in order to help ease difficulties on commercial banks. The lender still can accept a motorbike instead of a house as a mortgaged asset to provide a loan, and it can require stricter conditions on the loan.

What should Viet Nam do to settle the current problems?

Viet Nam is trying to curb inflation, but this does not mean that the central bank needs to tighten the monetary policies as tight as possible. This measure will help stabilise the macroeconomy in the immediate time, but will cause uncertainties in the microeconomy as people have to deal with too many difficulties. It is necessary to be determined to take action, but it is also necessary to be flexible.

If the dollar is in excess, the central bank should boldly spend VND to purchase dollars. The bank should also give interest rate liberalisation back to the market, while using necessary tools (exchange rate, interest rate) to regulate the monetary policies which aim to curb inflation and encourage economic growth.

It also requires flexible behaviour towards credit growth control. The 30% cap of credit growth rate should be understood as a cap for the whole economy, not for every bank. If every bank must restrain the credit growth rate at less than 30% as currently, a lot of banks will only be able to collect debts, not provide more loans, while businesses and individual cannot access bank loans anymore.

People are the main subject covered by the monetary policies; therefore, they have the right to get clear information about changes in policies in order to make suitable decisions. Don’t put more difficulties on businesses and people.

The tightened monetary policies have led to the stock and real estate market falls. Businesses, especially exporters, complain that they are facing too many difficulties. If the situation continues it could cause a lot of problems.

The most important thing is defining the right time for implementing policies. In early 1990s, Japan applied a harsh monetary policy (raising interest rates, raising compulsory reserve ratio, controlling the real estate market). The severe policy reduced inflation; however, Japan’s central bank’s blunder was that the country maintained the harsh policy for too long. As a result, the country fell into deflation ten years ago. Japan’s economy then experienced great difficulties. (Tuoi tre)

Vietcombank bosses face worried shareholders

Monday, April 28, 2008
Vietcombank's shareholders voiced strong concerns about shrinking share prices in the bank's first general shareholders meeting on Saturday, putting management on the hot seat to explain the bank's shrinking assets during the first quarter of the year.

In last December's initial public offering, the average winning price per share for Vietcombank stock was VND107,860. Four months later, the shares are trading on the over-the-counter market at about VND50,000 each, a loss of 54%.

One shareholder said the winning price was too high because of the fixed initial offering price of VND100,000 per share.

Based on his calculations of capital, profit, P/E ratio and the real situation in the domestic stock market last December, he now figured a more realistic offer price should have been around VND20,000.

Vietcombank chairman Nguyen Hoa Binh, however, said the downtrend of the bank's shares was in keeping with the overall trend on the stock market.

Many investors asserted that Vietcombank was harming the interests of shareholders by failing to reach agreement on suitable share prices with foreign strategic investors.

Vietcombank general director Nguyen Phuoc Thanh pointed to the difficulty in meeting the legal requirement set out in Decision No 109 that shares be sold to foreign strategic investors at a price higher than the winning bid in last year's IPO.

However, he noted, if Vietcombank were unable to sell more shares to strategic foreign investors, it would be unable to finalise the equalisation process, putting the bank into a catch-22 situation.

As it stands, outside investors still only hold about 9% of equity in the bank, while the State continues to own over 90%.

Meanwhile, companies with less than 20% sold to investors, are not allowed to list on the stock market, leaving Vietcombank shares in a sort of trading limbo on the over-the-counter market.

"I haven't heard any specific plan to sell more shares or reduce losses to investors," complained one shareholder.

Bank leaders said they could ask the Government to allow them to list on the stock market, as a special case.

Some individual shareholders were calling on Vietcombank to start buying back shares from large institutional investors to keep the share price from plunging deeper.

Others were calling for issues of bonus shares to existing shareholders at prices of around VND50,000 to help them minimise their losses.

A few shareholders also voiced anger over the fact that, of the capital reaped by Vietcombank through its IPO, it was only allowed to retain 30%, with the remaining 70% going into the State.

They felt that this operated to the detriment of shareholders and wanted to know how even the 30% of capital gained from the IPO was being spent.

These and other questions were left unresolved at the conclusion of the meeting.

The meeting voted to elect a seven-member executive board and five-member supervisory board, which would be paid a total of 0.36% of the bank's net profits.

The shareholders also approved an annual dividend of 12.08% for existing shareholders. (Viet Nam News)

Banks rush to make financial investments

Tuesday, April 29, 2008
Although share prices slash, many shares have lost their liquidity, particularly bank shares are under high pressure because of unfavourable movements of the monetary market, many banks still plan to promote financial investments in addition to other business activities.
For example, the Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank) will set aside 650 billion dong to buy stake of potential companies, according to the bank's plan on using equity in 2008. Furthermore, Sacombank will newly establish some subsidiaries with total capital of 1.110 trillion dong. In 2007, Sacombank made some financial investments into such businesses as Truong Hai Automobile, Huu Lien A Chau Steel, Sacombank Investment Co Early March, Sacombank continued injecting another 25 billion dong into the Yersin Da Lat University.

Additionally, Sacombank plans to set up some affiliated companies such as a gold and jewellery company that has been licensed, an insurance company, a card joint venture with ANZ and others, aiming to form the Sacombank Finance Group to be slated for the middle of this year. In 2007, Sacombank reported strong growth of profit, much of which came from capital contribution into other economic organisations.

As for the Asia Commercial Joint Stock Bank (ACB), in addition to financial investments, in 2007 the bank gained significant profit. The bank will expand business fields, develop operations in new fields professionally and closely manage risks. ACB will also scale up existing subsidiaries. As scheduled, ACB will spend another one trillion dong making investments in the upcoming time, bringing total investment capital to two trillion dong. The bank will establish some affiliated companies such as ACB Capital, ACB Card Co, ACB Gold and Silver Co and others. With the establishment of new affiliated companies, ACB will further acquire stake of economic organisations in 2008.

ACB plans to spend some 1.13 trillion dong buying more shares of businesses, bringing total initial investment capital to 1.4 trillion dong. All these investments will be assigned to ACBS, the bank's securities affiliate.

According to Nguyen Thanh Toai, vice general director of ACB, the bank's financial investments this year will be channeled via affifliated companies of which ACBS will be assigned most capital. ACB will select those companies which have stable operations, high growth potential, strong financial status. The bank's capital will mainly be invested into IPO companies.

Although having modest operation scopes, Pacific Bank said that in addition to diversifying business activities, it will switch from credit-focused trend to financial investment. Pacific Bank will also establish some affiliated companies operating in different fields. According to Pacific Bank, promoting financial investments as well as relations with many financial, insurance institutions will help the bank have more capital and improve revenue of banking services.

With a plan on raising capital from 2.8 trillion dong to 7.4 trillion dong in 2008, the Vietnam Export and Import Commercial Joint Stock Bank (Eximbank) said that, a part of the new capital will be used to expand scopes and business fields. Additionally, Eximbank will increase financial investment items and portfolios.

The above fact demonstrates that many banks are looking forward to opportunities to develop new financial investments in 2008. However because of increasingly gloomy moves of the stock market and no sign of recovery, many banks have seemed to be worried and have not yet been able to develop new investments. (DTCK)

Dilemma: IPOs unable to find customers

Monday, April 28, 2008
IPOs have become less and less attractive to investors. Experts believe that the main reason behind the problem is overvalued shares.
The quiet IPOs
In the first quarter of 2008, only 10 IPOs were organised at the HCM City Stock Exchange (HOSE), 1/3 of which failed as there were few participants.
The situation was even worse at the Hanoi Securities Trading Centre (HASTC), where many IPOs were cancelled as there was no interested investor. The IPO of the big company Habeco saw investors register to buy only 13% of total shares offered. Habeco’s and Vietcombank’s share prices have been decreasing sharply on the OTC market since their IPOs, which is another reason why investors are less interested.
It is very likely that “quiet” will appropriately refer to the IPOs of big names slated for 2008. A lot of big corporations are planning to make IPOs in 2008, including the Bank for Investment and Development of Vietnam (BIDV), Vietinbank, MobiFone, and Mekong Housing Bank.
A lot of reasons have been cited to explain the failure of IPOs, among which the biggest reason is the fall of the stock market, which has been making investors turn their backs on shares. Some experts have suggested delaying IPOs in order to reduce supply in order to rescue share prices from continuously sliding.
However, the suggestion has not received the support of many other experts, who believe that the delay of IPOs would slow down the equitisation process, which should be sped up instead.
Dr Le Tham Duong, Head of the Business Administration Faculty under the HCM City Banking University, said that the main problem of the failed IPOs was unsuitable prices.
“Investors would certainly be interested if the share issuer offers suitable prices,” Duong said, adding that enterprises should provide transparent information to the public in order to gain the confidence of investors in enterprises.
Changing the way of making IPOs?
Currently, enterprises, especially big ones, always make IPO first, and then negotiate with partners to select strategic shareholders. The basis for negotiations is the average IPO price, and the sale stake prices applied to strategic shareholders must not be lower than the average IPO price.
Experts say that the high starting prices of Sabeco, Vietcombank and Habeco made the P/E of the companies’ shares much higher than the average market’s P/E right at the moment of making IPO. As a result, none of the three companies have finished selecting strategic partners.
It is obvious that the state, as the owner of enterprises and the seller of stakes, aims to optimise the profit gained from IPOs. However, EuroCapital, a securities company, thinks that the government should declare a main purpose of IPOs: renovate equitised enterprises’ corporate skills or try to get as much money as possible from selling stakes.
The government should select strategic investors first and set specific requirements on the minimum time of holding stakes (in order to avoid speculation) and set requirements on partners in renovating enterprises. The IPO should be made later, and be carried out at s suitable moment in order to avoid possible shocks and supply & demand imbalance.
Experts have also advised investors to buy shares of equitising enterprises at this moment, as they can have opportunities to own big enterprises at low prices. (VnMedia)

One-third of local firms interested in acquisitions

Monday, April 28, 2008
A recent global survey conducted by the Grant Thornton Group International has shown that 30% of Vietnamese businesses plan to buy other companies.
The survey also revealed that of the respondents, only 3% said they might sell their companies in the coming three years.
The result is evidence of a healthy investment climate in Viet Nam , where businesses are optimistic about their opportunities ahead. Businesses said acquisition or mergers would be strategic tools for development.
However, the local figure is considered low compared to the global 44% of businesses who plan to buy other companies.

Vietcombank General Shareholders' Meeting 2008: Puzzle Pieces

Monday, April 28, 2008
Vietcombank, one the largest commercial bank in Viet Nam held its first General Shareholders' Meeting on April 26, 2008. For the first time the name Viet Nam Joint-stock Bank for Foreign Trade has ever appeared. The meeting marked a new stage of development for Vietnam's most hitorically rich commercial bank.
However, much of its headache will still be ahead. The SGM was organized amid the stock market chaos, with Vietcombank's stock price plunged by about 50% compared to its IPO price in late 2007 (at the time VND 107,000/share). The majority of its shareholders attended the meeting appeared to be puzzled and concerned, given the current stock price on the free market priced in between VND 50,000-60,000/share. A disgruntled shareholder also tried to explain his computation that Vietcombank's stock price should have been around VND 14,000-22,000/share, a number that shocks everyone that is familiar with the evolution of Vietcombank's IPO since its issue of convertible bonds in 2006.
Domestic shareholders shared the view that the Vietcombank's stock might have been mistakenly priced during the IPO process. They complained there should have been ways to alleviate the current difficult situation. Alternatives should be taken taking into account its next steps of selecting a "strategic partner" and listing its stocks. Some suggested the bank purchase stocks to enrich treasury stock, creating liquidity and stopping the price from further drop.
CEO of Vietcombank, Nguyen Phuoc Thanh, unveiled the fact that the bank now faces a dilemma. The current market price of 50-60,000 would damage the trust of existing shareholders who bought Vietcombank stock at over 100,000. But if the bank thinks about any higher price than the market level, it could hardly identify a business partner, a critically important assignment of the BOD predefined at the outset of the IPO.
Vietcombank has now 15,500 shareholders, but they collectively hold only 9% of its equity. 91% remains with the State. All major decisions regarding the future of the bank will still be made by the government. Given its 15,500 shareholders, only 2,000 registered to attend the GSM, but only 700 showed up. The many shareholder left the GSM before the discussion session on the bank's business plan and the voting for this year's BOD. (Saga Viet Nam)

Viet Nam Accelerates State Enterprise Restructuring

Monday, April 28, 2008
Viet Nam is speeding up restructuring state-owned enterprises (SOEs), including equitization of big corporations from now to 2010.
Viet Nam is facilitating the restructure of state agricultural and forestry farms, and equitization of large state corporations and economic groups, including the Viet Nam National Textile and Garment Group, the newspaper quoted a report presented by the country's Steering Board for Enterprise Renewal and Development at a national conference on SOE restructure on April 23.
Viet Nam will also have specific policies and mechanisms designated for large SOEs and economic groups so that they will intensify investment in technology renewal, make their finance healthier, and focus on major business fields and avoid rampant investment.
Viet Nam is to restructure 1,553 SOEs, including equitization of 950 enterprises in the 2007-2010 period, said the steering board. The country restructured 5,366 SOEs, of which 3,756 were equitized in 2007.
Of the SOEs equitized last year, 17 enterprises had capital of over 100 billion Viet Namese dong (VND) (nearly 6.3 million U.S. dollars) each, and some others, including the Bank for Foreign Trade of Viet Nam (Vietcombank), the Viet Nam Insurance Corporation and the Saigon Beverage Corporation had capital of more than 1,000 billion VND (62.5 million dollars) each.
"In the 2008-2010 period, we will equitize all 104 state corporations according to market rules, in attachment to listing their shares in the local stock market. We are also created favorable conditions for equitized enterprises to list shares abroad," Viet Namese Prime Minister Nguyen Tan Dung told domestic and foreign business leaders in January.
Viet Nam, housing 6,000 SOEs in early 2001, had only 1,400 SOEs in late 2007, including over 400 plantations and more than 100 public utilities, he said, noting that most of equitized firms are operating effectively, and recording rapid growth.

Can Viet Nam handle its stock market?

Monday, April 28, 2008
Poorly managed and overrun by investors who act like gamblers, Viet Nam’s stock exchanges may have been born into a country that wasn’t ready for them.
Is Vietnam prepared for a financial market that follows market-based principles and helps the country integrate into the global economy? Based on market developments earlier this year, the answer is no.
The State Securities Commission’s (SSC) decision to cut the share trading band on the stock markets to 1 percent and 2 percent on March 25 was a Band-Aid solution to the market’s major fall earlier this year.
No established stock market would change its rules so abruptly.
In the long term, it could be hard to attract investors, especially foreign ones, to a market that does not adhere to normal principles.

The strength of a stock market can be demonstrated by its management agencies’ ability to establish and enforce “delicate” policies that help them achieve their desired targets fairly.

The most important responsibilities of the SSC are to enforce regulations and ensure market transparency.

But investors can hardly find accurate data about listed companies as SSC has not pushed them on this issue.

Earlier this year, a company preparing to list said their assets had grown about ten-fold because the prices of the properties they invested in were soaring.

SCC should have blown whistle on this false claim.

Such claims could be found in many announcements of listed companies but SSC and the two stock exchanges’ managers did nothing to correct it.

Recently, when the stock markets stalled for 10 straight days two weeks ago, everyone worried that their collapse would affect many important sectors, especially the banking sectors which had been generous to stock loans, and the economy as a whole.

But the stock market managers’ role should have been to coordinate with other responsible government agencies to find out and address the root cause of the fall, not only focus on reversing the trend.

The answer as to whether or not Vietnam is ready for stock markets is even more apparent when we take a closer look at the listed companies.

There is some level of greed on all markets, but the greed that many listed companies displayed on our market last year was too much.

Equitization and initial public offerings have brought giant sums of money to many companies, arousing in them a desire to earn as much as possible for themselves without regard for the interests of shareholders.

Share auctions earned these companies bit money that they did not how to spend effectively.

They therefore started issuing bonus shares to turn the money into an increase of their capital.

They also invested in other companies and saw their investment double or triple after some time.

Obviously, the market was unprepared for this “strategy” so stock prices ballooned and burst, as we’ve unfortunately seen.

Listed companies do not know how to use their financial capacity to encourage employees and develop optimum business strategies.

Their executive officers, who often hold the largest stakes, have ignored small shareholders and the companies’ long-term future to make decisions that only benefit themselves in the short term.

Finally, local investors have played the stock market as if they were gambling.

For them, stock prices must fluctuate vigorously to make big money fast.

Very few care about dividends let alone a long-term investment strategy.

It is different in other countries: individuals invest in stock indirectly through mutual funds or pension funds.

Few would spend the whole day at the stock exchange and even fewer would use bank loans to invest in stocks.

Foreign investors, who are expected to stabilize the market, are in fact a varied lot.

Many of them are professional investors.

Many others are sheer speculators.

They can one day buy a lot of shares and become a company’s “strategic partner,” but a few months later they sell the shares for a big profit.

An example was Texas Pacific Group (TPG) Ventures which bought into top Vietnam technology firm FPT at a low price to become its strategic partner in late 2006 but sold a large volume of the shares for big profits six months later.

When the main market components are not prepared for the long-term, abnormal fluctuations are inevitable.

Let us hope the market’s harsh natural selection will force everybody to think and act professionally.

In the mean time, it’s sensible – and essential – to slow the opening of the financial market.

Just imagine, if the stock market grew larger without reservation and the participation of foreign investors continued to grow unchecked, could a new stock market crash be even more disastrous than the last one? (TBKTSG)

SHB offers free ATM cards

Monday, April 28, 2008
Free ATM cards have been offered by Sai Gon-Hanoi Commercial Joint Stock Bank (SHB) in the sale promotion programme from April 30 to June 30.
The fee for opening ATM cards is VND 100,000 each.
In addition, customers can apply for the bank’s overdraft arrangement which promises a maximum credit of VND 200 million customers or VND 300 million (with mortgaged property).
Saving account also enjoys a non-due interest from SHB.
The activity is to celebrate the National Reunification Day (April 30) and May Day (May 1).

VIB Bank remains open after regular time

Monday, April 28, 2008
As of April 28, some Vietnam International Commercial Joint Stock Bank (VIB Bank) branches, namely the headquarter in Hanoi, Ba Dinh district branch, My Dinh transaction office (Hanoi) and District 5 branch, Thanh Do branch in Ho Chi Minh City, will remain open after regular hours.
The new working hours will be from 8.00-12.00 noon and 1pm-6.30pm on weekdays, and from 8-11am on Saturdays.
There will be no changes in the services for customers.
VIB Bank plans to apply the new timetable across the country from Sep 2008. (TBKTVN)

Military Bank opens additional branch in Ha Tay

Monday, April 28, 2008
The Military Commercial Joint Stock Bank (MB) has officially opened an additional branch in 634 Quang Trung street, Ha Dong city, Ha Tay province, bringing the total number of its branches nationwide to 71.
The branch provides various banking services to individuals, groups in the area. Being one of eight key economic areas in the North, Ha Tay province has great potential and a good market for the bank.
At its inauguration, Ha Tay branch presented gifts to the first 500 customers and its staff gave 10 million VND to a local orphanage.

Central bank won’t change rates on inflation

Sunday, April 27, 2008
Viet Nam’s central bank will not change the benchmark interest rate because month-on-month increases in inflation show recent policy measures have been effective, according to Governor Nguyen Van Giau.
Consumer prices in the Southeast Asian nation surged 21.4% this month from April 2007, the most since at least 1992, according to figures released Friday by the General Statistics Office in Hanoi.
From a month earlier, prices rose 2.2%, compared with gains of 3% in March from February.
“We are fine with this month’s inflation since we care more about month-on-month prices, and on a monthly basis you can see that inflation has slowed down and showed that the central bank’s short-term measures have been effective,’’ Giau said Friday
“So we will keep the base rate at its current level of 8.75%.’’
The State Bank of Viet Nam has raised interest rates, increased bank reserves and sold compulsory bills this year in a bid to slow money-supply growth and combat inflation. (Bloomberg)

Property developer, Vincom profit ups 33 per-cent on rentals

Vincom Joint-Stock Co., a Vietnamese real estate developer, said first-quarter profit rose 33% on increased office rentals and higher revenue from advertisements placed in the company’s premises.
Net income surged to VND38 billion (US$2.4 million) in the three months ended March 31, from VND28.5 billion ($1.77 million) in the year-earlier period, the Hanoi-based company said this week.
Sales rose to VND53 billion ($3.29 million) from VND43 billion ($2.67 million).
A “wide range” of clients signed contracts to rent stalls at higher rentals and “many’’ contracts were secured for partners to post promotional posters in and outside Vincom’s buildings, the company said, without providing more details.
Vincom shares gained VND1,500 ($0.09), or 1.7%, to VND90,500 ($5.6) on the Ho Chi Minh Stock Exchange, the country’s main board.
The property developer has 120 million shares outstanding, and a market value of VND11 trillion($684 million), making it the seventh-biggest company on the Ho Chi Minh Stock Exchange, according to data compiled by Bloomberg. (Bloomberg)

Foreign Fund Management Applicants Must Have Securities Assets of US$300Mln

Sunday, April 27, 2008
Foreign investors who want to set up 100% foreign owned fund management companies in Viet Nam must be managing securities with the market value of at least US$300 million, according to the Finance Ministry’s draft regulation on foreign transactions in Viet Nam’s stock market.
Foreign fund management companies who want to establish branches in Viet Nam must have at least US$500 million in total registered capital of their managed funds and securities companies.
Before Viet Nam opens its securities market under its WTO commitments, the wholly foreign owned fund management companies and branches of foreign fund management companies are only authorized to provide asset management services for foreigners in Viet Nam.
Foreign-invested fund management companies are allowed to be converted into the wholly foreign owned firms.
The wholly foreign owned fund management companies have operational duration of less than 99 years and branches of foreign companies less than five years.
The draft also regulates that a foreign investor is allowed to open a Viet Nam dong account for indirect investment capital at a credit institution licensed to trade foreign currency. All transactions related to securities market such as buying and selling shares, transferring money and payment, will have to be made via this account.
Hoang Phong, a partner with Thanh Ninh law firm, said the draft would become a basis for the finance ministry and other market regulators to manage business of foreign fund management companies.

Gia Tue investment firm commissions six realty projects

Saturday, April 26, 2008
Gia Tue Investment Joint Stock Co recently announced that it would sign strategic cooperation agreements with Saigon Thuong Tin Real Estate Joint Stock Co (Sacomreal), Hoa Binh Real Estate Trade and Construction Joint Stock Co and VNS Securities Joint Stock Co on April 26 to carry out a series of big real estate projects.
At present, Gia Tue is implementing six realty projects nationwide covering on total area of 500 hectares and total investment capital of five trillion dong
According to Tran Minh Hoang, Gia Tue Co's chair, his company targets to provide some one million square metres of apartment floor area and 200,000 square metres of office floor area and manage and exploit 500 rooms in four-five start hotels by 2012.

SSC halts securities company establishment

Saturday, April 26, 2008
The State Securities Commission (SSC) will temporarily halt receiving new applications for the establishment of securities and fund management companies as from April 28.
The SSC explained that the move aims to ensure sustainable development for the fledgling stock market in the country.
While lauding securities and fund management companies’ positive contributions to the growth of the stock market, the SSC also said these companies need to have their operation reassessed in a bid to raise the quality of their services.
The stock market watchdog also said it will later announce the date for receiving new applications. (VNA)

Vinasun Corp targets 92b dong profit in 2008

Saturday, April 26, 2008
Anh Duong Viet Nam Joint Stock Corp (Vinasun) recently reported gaining revenue of over 549 billion dong in 2007, rising 107.4% against 2006 and 73.6 billion dong from after tax profit.
The company also targets to earn 92 billion dong in pre tax profit this year and pay a 2007 dividend of 18% that could be 20% for 2008.
Now, Vinasun Corp is managing nearly 1,500 cabs and coaches that could be 2,500 at the end of this year.
At present, the company holds 35% of HCM City's market share, 50% in neighbouring province of Binh Duong and being one of the most prestigious and quality firms in Vietnam.
In addition, Vinasun also invests in real estate field with many big projects including apartment project in Dist 8, Tan Da trade centre in Dist 5, Tay Bac (Northwest) Cu Chi villas area, Vinasun urban zone in Dong Thap and Vinasun Tower project in district 1.
The company expected that these projects when put into operation would bring in over 30 billion dong from after tax profit. (DTCK)

Vinatex postpones share sale till 2009

Saturday, April 26, 2008
Viet Nam National Textile & Garment Group, known as Vinatex, plans to postpone its initial share sale to 2009 as the benchmark stock index slumped, said Chairman Le Quoc An.
The share sale was initially scheduled for this year.
The benchmark VN-Index has fallen 45% this year, the worst performer among 90 global key indexes tracked by Bloomberg. (Bloomberg)

Hacisco shareholder raises stake

Saturday, April 26, 2008
Hanoi Post and Telecommunication Construction and Installation Joint-Stock Company (Hacisco) shareholder Robert Alexander Stone raised his stake to 6.09% from 5.9% on April 18.
Stone boosted his stake by buying 10,000 shares, the Ho Chi Minh Stock Exchange reported on its website.
Last month he bought a similar-sized parcel of shares in the Hanoi-based firm.
Hacisco, which provides cellular and fixed-line telephone, fax, trunk and telex services, is in the process of buying back 500,000 shares between March 14 and June 14.
The stock slumped VND300, or 1.56%, to close at VND18,900 on Friday, its lowest this year. (TN)

Moves to curb inflation may hurt loans: Bank

Saturday, April 26, 2008
Moves to curb inflation may hurt loans: Bank
The loan market could be hurt by speculation that the government plans to tighten credit to slow inflation, the Viet Nam Bank for Industry and Trade has warned.
“The credit and capital markets may face difficulty because of government policy in the months ahead,” Nguyen Anh Tuan, deputy director of the banking division at the bank, known as VietinBank, said in an interview on the sidelines of a conference in Hanoi Thursday.
April inflation rose to 21.4% year-on-year, prompting speculation the government may ramp up measures to slow lending.
The central bank has raised benchmark interest rates this year, told banks to raise the amount of compulsory reserve, and sold more bills and bonds to drain liquidity to slow inflation.
Viet Nam has limited liquidity, a small number of banks with branches in the country, withholding tax on interest and competing sources of debt capital, Ana Dhoraisingam, Singapore-based regional head of syndication at Australia & New Zealand Banking Group Ltd. told the Hanoi conference. (Bloomberg)

Hai Phong paint producer releases fiscal report

Saturday, April 26, 2008
Hai Phong Paint Joint Stock Co released its 2007 fiscal report with 231.747 billion dong in total capital including 65.929 billion dong in equity, 374.447 billion dong in revenue from sales and service provision, 71.174 billion dong in combined profit from sales and service provision, and 982.020 million dong from financial investment.
It also gained 28.099 billion dong in total pre-tax profit with CIT of 3.851 billion dong so its after-tax profit was 24.247 billion dong, 913.304 million dong in other profits, EPS of 55,317 dong and its dividend at 20%.
Its cost for financial operation was posted at 7.916 billion dong while that for sales was 26.622 billion dong, for corporate administration was 10.433 billion dong and other costs were about 123.72 million dong.

My Chau Printing and Packing posts over 226.858b dong in total assets

Saturday, April 26, 2008
My Chau Printing and Packing Joint Stock Co last year posted over 226.858 billion dong in total assets while its total revenue attained about 166.017 billion dong.
The producer also earned 22.2 billion dong in combined profit, 981.008 million dong from financial activities, 253.117 million dong in other profits, total pre-tax profit of nearly 11.845 billion dong, after-tax profit of 10.479 billion dong and EPS of 3,493 dong.
Its cost for financial activities was 2.118 billion dong, for sales at about 3.520 billion dong, for corporate administration was 5.912 billion dong and other costs were 176.258 million dong.

Kinh Bac Co to scale up chartered capital to 2tr dong

Saturday, April 26, 2008
Listed firm Kinh Bac Urban Development Joint Stock Company (coded KBC) recently announced it would pay a 2007 dividend of 43% in shares.

Last year, KBC earned 320 billion dong from after tax profit, equalling to 683% of the year's plan and its total asset reached 3.013 trillion dong, up 333% yoy.

This year, the company plans to offer more shares to hike its chartered capital to two trillion dong, bring 1.189 trillion dong in revenue and 611 billion dong from after tax profit and pay dividend of minimum 30%.

At present, KBC is carrying out its investment project spending US$100 million to expand Bac Ninh province's Que Vo industrial complex to a total expected area of over 600 hectares, a US$200 million Yen Phong industrial zone project in the first phase in Bac Ninh and the Phuc Ninh urban zone project capitalised at US$200 million.

This year, the company and Taiwan-based Foxcon Group will jointly carry out the Trang Cat high-tech and new urban zone project in the northern province of Hai Phong along with other projects. (DTCK)

Thanh Binh Joint Stock Co reports 2007 performance

Saturday, April 26, 2008
Thanh Binh Joint Stock Co recently reported that in the last fiscal year, it gained about 161.097 billion dong in total assets, 160.278 billion dong in revenue from sales and service provision, 22.568 billion dong in combined profit from sales and service provision.
In addition, it also reached nearly 14.445 billion dong in net profit from business, 167.219 million dong from other profits, 12.825 billion dong in after-tax profit, and EPS of 2,191 dong.
The company spent 3.983 billion dong on financial cost, 1.551 billion dong on sale cost and 2.746 billion dong on corporate administration cost.

Thanh Cong garment and textile firm to issue 500b dong of convertible bonds

Saturday, April 26, 2008
Thanh Cong Garment and Textile Joint Stock Co (coded TMC) recently announced its plan to issue five million convertible bonds at the face value of 100,000 dong aiming to meet the demand of business activities development and scale up chartered capital over next years.
These bonds have yearly coupon rate of 12% and can be converted into shares for three-years. The detailed convertibility measure will be passed in the shareholders' meeting that will be held on April 26 under the consultancy of Au Lac Securities Joint Stock Co.

OCB to hike chartered capital to 1.7tr dong

Saturday, April 26, 2008
Orient Commercial Joint Stock Bank (OCB)'s shareholders' meeting recently passed the plan to hike its chartered capital from the current over 1.111 trillion dong to about 1.7 trillion dong through issuing more shares.

Particularly, the bank will issue bonus shares to existing shareholders at the ratio of equalling to 33% of their total holding. Then, another 2.5 million shares will be sold to the bank's employees. Finally, 20 million shares will be offered the strategic partner BNP Paribas, bringing the foreign investor's size in the local lender to 15%.

In addition, OCB will also offer a share volume to selected external shareholders.

Bac Lieu fisheries processor goes public

Saturday, April 26, 2008
The Hanoi Securities Trading Center (HaSTC) on April 22 approved in principle Bac Lieu Fisheries Joint Stock Co (coded BLF) to list shares on the northern bourse.

BLF officially changed into the model of joint stock company from July 20, 2006 specialising in seafood and aquatic production, processing, export and import.

In 2007, the processor reached 262.8 billion dong in revenue and 11.2 billion dong from after tax profit. In October 2007, the company finished new frozen sushi production line to export to Japanese and European markets. At present, the company earns monthly over US$300,000 from seafood export turnover

This year, BLF plans to hike its chartered capital to 80 billion dong through adding equitisation surplus capital to chartered capital and offering more shares to the strategic shareholders.

The capital being mobilised from the share issue will be invested in future projects, which were signed with Japan and Korea partners.

The company also plans to build a new plant in HCM City and Bac Lieu in the forthcoming time. (DTCK)

Greenlight for foreign audit firms

Saturday, April 26, 2008
The State Securities Commission (SSC) has announced that four foreign auditing firms have been allowed to audit securities issuers, listed companies and securities business firms.

The firms are Ernst & Young Viet Nam, Grant Thompton Viet Nam , Price- waterhouse Coopers Viet Nam and KPMG.

The companies are among 28 autiditing firms qualified to do the job.

Ministry of Finance’s Decision No 89 issued last October requires a qualified company to have a charter capital or ownership capital of at least 2 billion VND (125,000 USD) for domestic firms; and a charter capital of 300,000 USD or more for foreign invested firms.

A company must have at least seven auditors: and must have been in operation for at least three years, the decision states.

The SSC considers and gives permission to qualified firms just once a year.

Companies that carry out auditing must submit documents to the commission from October 1 to October 30 annually. The commission announces the results usually by November 15.

Vu Thi Kim Lien, SSC vice chairwoman , said the commission waited to announce the list because at the end of last year and the beginning of this year it was considering supplying new companies with new criteria. (VNA)

SBV provides support to ensure commercial banks’ liquidity

Saturday, April 26, 2008
The State Bank of Viet Nam (SBV) has sent a document to commercial banks, affirming that SBV will strengthen the refunding of capital, in the form of guaranteed loans, to commercial banks to ensure their payment capacity, especially small-scale ones.

Together with the refunding capital, the SBV will also continue its capital support through daily open market operations.

The consideration and decision to grant capital refunding will be made quickly, based on the proposals of commercial banks, the real capital supply-demand situation and the objectives of the current monetary policies.

With this move from the SBV, the banking market in the coming time is expected to be less tense in capital supply an demand, thus lessening elements that boost interest rates to increase.

Earlier, members of the Viet Nam Banking Association have also reached a consensus on continuing to maintain the maximum interest rates for deposits in Vietnamese dong at 11% a year.

Bao Viet Securities broker to hike chartered capital

Saturday, April 26, 2008
Bao Viet Securities Company (BVS) recently approved this year's business plan with the total revenue of 314 billion dong, 142.3 billion dong from after tax profit and pay dividend of 20%.

The company also plans to hike its chartered capital to one trillion dong from the current of 450 billion dong via offering more shares within this year or by the end of next year and sell about 10% stake to foreign shareholders after capital increase.

During the first quarter of this year, BVS made a revenue of 59.17 billion dong and 27.8 billion dong from pre tax profit. The broker added 30 million more shares to securities depository centre from April 23. These are shares being offered to the existing shareholders under the model of buying right at the ratio of two new shares for one share held and the offering price of 323,000 dong per share.

Last year, the company gained 399.9 billion dong in total revenue and 214.5 billion dong from after tax profit and planed to pay dividend of 20%.

Investment firm No 577 to offer 5.6m shares

Saturday, April 26, 2008
Investment Joint Stock Co No 577 (coded NBB)'s shareholders' meeting recently passed the plan to offer 5.6 million more shares within this year to hike its chartered capital from the current of 154 billion dong to 210 billion dong and raise capital for its big projects including high rise apartment buildings of NBB Garden 1, NBB Garden 3, Peony Garden in HCM City and eco-urban area in the northern city of Ha Long.

This year, NBB targets to bring 344.47 billion dong in revenue, of which 298.94 billion dong from real estate field, and 65 billion dong from after tax profit and pay a 14% dividend.

Last year, the company reached 215.03 billion dong in total revenue, up 168% against the year's target, of which revenue from real estate gained 132.3 billion dong, 40.66 billion dong from pre tax profit, 29.27 billion dong from after tax profit and planed to pay a 12% dividend.

Two more firms to buy back fund shares

Friday, April 25, 2008
The Ho Chi Minh City Stock Exchange (HOSE) recently announced that on April 22, there were two more listed companies registering to buy back shares to make fund shares namely Thanh Thanh Ceramic Joint Stock Co (coded TTC) and Ben Tre Seafood Export Import Joint Stock Co (coded ABT).

In particular, TTC will buy back 100,000 TTC-coded shares within two months from May 5 to July 5 under the model of negotiation and order marching.

ABT will buy 800,000 ABT-coded shares under the same model within three months from May 6 to August 6.

Vietcombank reports performance in Q1

Friday, April 25, 2008
Bank for Foreign Trade of Viet Nam (Vietcombank) recently announced that up to March 31, its total capital reached 195.587 trillion dong, 105.562 trillion dong in outstanding debts, up 10.1% against last year and the overdue debt rate was 1.4%.
In particular, the bank’s turnover from export and import payment sector gained US$8.428 billion in the first quarter of 2008, up 32.3% against the same period of last year or 24.9% of this year’s plan and accounting for 25.2% of the country’s export and import market share. In January-March, Vietcombank’s export turnover obtained US$4.799 billion and import spending was US$3.628 billion.

As for card sector, the bank launched 5,365 more international credit cards in the first quarter of the year, bringing the total figure to 26,207 international credit cards issued by Vietcombank. The lender also issued 242,687 cards of connect 24 and 12,197 MTV cards and Visa debit cards. Turnover from international card payments gained US$174 million or 32.5% of the year’s plan, and the turnover from using credit cards issued by Vietcombank was 484 billion dong, equalling to 12.7% of the year’s target.

As for field of trading foreign currency, the bank reached over US$7 billion, a year-on-year increase of 36%, of which, Vietcombank bought in US$3.481 billion, up 34% yoy and sold out US$3.551 billion, increasing 38% yoy. Foreign currency being sold out for importing petrol reached US$504 million, a higher level than US$399 million of the same period of previous year.

In the first quarter of 2008, Vietcombank’s after tax profit attained over 900 billion dong.

This year, the bank targets to keep outstanding debt below 30% and the bad debt at maximum of 2.6% and reach 158.861 trillion dong in total deposits from the economy and a chartered capital of 15 trillion dong.

The bank also plans to expand its network with branches in Hanoi, Thanh Hoa, Ha Tay, Tien Giang and Tay Ninh and 60 transaction offices nationwide.

With this target, Vietcombank expects to earn 4.537 trillion dong in revenue, up 13.94% on 2007, 2.339 trillion dong in revenue from other services and business activities, a year-on-year increase of 6.97% and 3.383 trillion dong in profit. (SBV)

Vietcombank says bad debt edges up to 1.4 percent in Q1

Friday, April 25, 2008
Vietcombank, Viet Nam’s third-largest lender, said Wednesday its overdue debt edged up to 1.4% of outstanding loans in the first quarter of this year, from less than 1.3% in the year-ago period.

The Hanoi-based bank, Viet Nam’s first state-run bank to float last December, said loans on March 31 rose 10% from the end of last year to VND105.56 trillion (US$6.6 billion).

The government has said it would reduce ownership gradually to 51% of stake in Vietcombank, which handles a quarter of Viet Nam’s total export and import payments.

Vietcombank did not give a reason for the higher overdue debt or provide its bad debt rate in the first quarter but said it made a net profit of 900 billion dong ($55.59 million), a statement on the central bank’s website (www.sbv.gov.vn) said.

Its total assets eased 0.3% from the end of 2007 to VND195.59 trillion ($12.13 billion) in March, the statement said without giving a comparative figure for profit in the first quarter of 2007.

Vietcombank Chairman Nguyen Hoa Binh said it was the first time in the bank’s 45 years of operation that the total assets declined.

The lender is set to list overseas in 2009

Global economic slowdown and rapid changes on domestic monetary markets has affected Vietcombank’s performance, Binh said at a news briefing Tuesday.

Vietcombank is due to hold its first shareholder meeting on Saturday in Hanoi.

The bank has said the meeting would discuss business targets for 2008, selection of a foreign strategic investor and also its domestic share listing.

Chairman Binh said Vietcombank would list shares on the country’s main exchange in Ho Chi Minh City in June while the actual debut date would depend on shareholders’ approval as well as approval from market regulators.

Vietcombank also planned to list overseas next year, Binh said without naming a specific market but Vietcombank officials have said the bank could list in Hong Kong or Singapore.

The lender has projected a credit growth of 30% this year, in line with a central bank’s 30% growth target for the entire banking industry as it moved to tighten money supply to control double-digit inflation.

Last year Viet Nam’s lending surged 54%.

Vietcombank expected its gross profit to rise 11.68% to VND3.38 trillion ($209 million) in 2008, it said in a report issued to shareholders ahead of the Saturday meeting.

The bank aims to cut bad debt to 2.6% of loans this year from 3.4% last year while its projected return-on-equity would ease to 15.71% from 16.95% in 2007, the report said.

Credit growth at banks and financial institutions in the Southeast Asian nation reached about 50 percent last year, according to the International Monetary Fund.

The government is prioritizing controlling inflation over economic growth.

Viet Nam may reduce this year’s target growth rate to around 7% instead of the 8.5-9% band set last year. (Reuters)

April 25, VN Index keeps falling, HaSTC Index rallies

Friday, April 25, 2008
Ending the trading session today April 25, the 1774th trading session of the Vietnamese stock market, the Ho Chi Minh City Stock Exchange (HOSE) closed a week be seeing another decline as the VN Index lost 2.54 points or 0.48% to 515.88 pts with the total matching order trade of nearly seven million shares and fund certificates worth over 290 billion dong, marking the sixth consecutive decreasing session on the stock market.

Among 154 shares and fund certificates being listed on the southern bourse, the stock market recorded 52 shares increasing, 15 others remained unchanged and 86 shares decreasing.

Out of top ten shares with the largest market capitalisation, three shares increased namely VNM up 2,000 dong to 130,000 dong, VIC leaped 1,500 dong to 90,500 dong and ITA bounced 1,000 dong to 70,000 dong per share. DPM stood still at the comparative price.

STB and PPC lost 700 dong to 34,700 dong and 37,100 dong per share, SSI, HPG and PVD dropped 1,000 dong to 51,000 dong, 61,000 dong and 113,000 dong per share, VPL slipped 2,000 to 113,000, FPT slashed 1,500 dong to 84,000 dong per share.

There were 40 shares reaching the ceiling price like DHG, IMP, KDC, TDH and ANV.

STB took the first place in trading volume with over 2.1 million shares, followed by DPM with 613,620 shares, SSI with 350,400, VTO with 284,400 shares and others including VHG, PPC and HPG.

Foreign investors bought in 71 share codes with the total volume of 1,586,250 shares. VTO reached the biggest trading volume with 318,800 shares, DPM with 255,580, SSI with 207,440 and VHG with 110,000 shares.

Conversely, the Hanoi Securities Trading Center (HaSTC) today April 25 rallied on the stock market as the HaSTC Index resumed 0.88 points or 0.52% to end at 168.95 pts with the total market trade of 3,523,620 shares worth nearly 152 billion dong.

Amongst 135 listed shares on the northern bourse, the stock market saw 39 shares increasing while 83 others decreasing, five shares stood still and eight shares with no trades.

Five shares stood still including DCS, SDY, VE9, VTL and VTV.
Eight shares with no trade were B82, C92, CAP, CID, HPS, HSC, HUT and NPS.

MIC was the biggest gainer when adding 2,600 dong and followed by NTP up 1,100 dong, others increased below 1,000 dong per share.

BVS showed the strongest decline when losing 2,300 dong and VSP lost 2,000 dong. Others fell below 2,000 dong per share.

KLS reached the biggest trading volume with 284,400 shares and followed by ACB with 210,900 shares, PVS with 194,400 shares and NVC with 127,700 shares.

Listed companies don’t want to increase chartered capital

Friday, April 25, 2008
The listed companies which have the chartered capital of less than VND80bil now have two choices, either raise chartered capital to VND80bil by February 2009, or list on the Hanoi bourse. However, most of them want another scenario, hoping that state management agencies will delay the deadline for the implementation of the regulation on VND80bil worth of chartered capital.

Nguyen Thi Lien Phuong, Chairman of the Seafood Company No 1 (SJ 1), said: “We don’t think of listing on Hanoi bourse because our business is now prosperous. I think state management agencies should not force us to raise chartered capital to VND80bil. The regulation should be imposed on newly listed companies only.”

Phuong said that in 2007, SJ 1 successfully issued 1.5mil shares to raise its chartered capital to VND35bil. The plan on issuing shares to raise chartered capital to VND80bil has not been implemented as the company still does not really need more capital. Moreover, the current conditions of the market prove to be not favourable enough for share issuance.

With the current chartered capital, the company’s management board has been under hard pressure to get profit. It needs to get VND9bil worth of profit, including VND7bil from the main business field, and VND2bil from other investments.

Ngo Duc Dung, Deputy Director of SJ 1 said that if the company must raise capital, it would use the money to implement the project on the trade complex and luxury apartments. However, to date, the project is still under negotiations with partners with no concrete agreement reached so far.

Dung said that the sum of VND39bil got from the share issuance in 2007 has been left unused.

In fact, listed companies absolutely do not want to issue shares to raise chartered capital at this moment if they don’t have a plan to use the capital to be mobilised effectively.

The Saigon Garment Company is planning to issue shares to increase capital to VND80bil as stipulated by the laws by the end of 2008. In order to make the share issuance plan feasible, the company has decided to sell shares to existing shareholders at VND12,000/share instead of VND20,000/share as initially planned.

Le Quang Hung, General Director of the company, said that the director board tried to persuade shareholders that the company needs to issue shares to mobilise capital for investment projects, otherwise, they would not accept the share issuance, though they know that the company will have to shift to list on Hanoi bourse.

Decree No 14 stipulates that in order to be eligible to list at the HCM City Stock Exchange, companies must have the chartered capital of VND80bil.

For the organisations which listed at HOSE before the decree became effective, if they cannot meet the above said requirements, they have two years to meet the requirements, or they will have to shift to list at the Hanoi Securities Trading Centre.(DTCK)

Friday, April 25, 2008
BankInvest partners with Hoa Phat Group

Denmark ’s BankInvest will become a strategic partner of Viet Nam ’s Hoa Phat Group when it purchases a 5.2% of stake of the local company.

Under an agreement signed in Hanoi on April 25, BankInvest’s capital will support Hoa Phat’s investment plans in steel production, industrial zones extension and civil engineering.

BankInvest will also use its business administration and management experience to help build Hoa Phat’s future strategic plans.

Hoa Phat will continue focusing on industrial production, especially steel, industrial zones, cement and minerals with an expected annual growth rate of turnover and profit from 20 to 25%.

Market falls, companies cancel listing plans

Friday, April 25, 2008
The prolonged falls of the stock market have made many companies shrink. They are considering cancelling or delaying their listing plans.
One of the topics of discussion at the shareholders’ meeting of a bank in Hanoi recently was the listing of the bank at the Hanoi Securities Trading Centre (HASTC).

Many shareholders asked if the share issuance would make the situation worse, since share prices have been decreasing dramatically since the beginning of the year.

Though the bank has fulfilled the procedures for listing at HASTC, its management and supervision board still worry about the feasibility of the plan as the market now shows unfavourable conditions.

The bank’s shareholders had two different viewpoints. Some of them, fearing that share prices will drop further, which will make their assets smaller, did not advocate the listing plan. Meanwhile, some others said that the listing will help improve the liquidity of shares, and those who want to give up investments, can easily sell shares on the bourse. The bank is planning to raise its chartered capital to VND4tril, double the current level.

The leader of the bank, contacted by reporters, declined to answer the question about his viewpoint on the listing plan, saying that this is really a very sensitive issue at this moment.

The same situation is being faced by two other banks in Hanoi. Sources say that one of the two has even decided to withdraw its application for listing on the bourse even though it has fulfilled all necessary procedures and all it has to do now is wait for an official licence.

Nguyen Son, Head of the Market Development Division under the State Securities Commission, said that businesses have the right to decide whether to list or not. However, he stressed that listing on the bourse means bringing shares of businesses into transactions on the market, while the companies’ business will not see any changes (chartered capital, volume of shares…).

Son has reminded companies that share liquidity will be improved if the shares can be transacted on the official market. Moreover, transparent information will create favourable conditions for more investors to access and buy shares of the company.

SSC has only advised companies to delay their plans to issue more shares to raise capital, while it does not think that companies have to delay their listing plans due to the market’s falls.

Meanwhile, according to General Director of Bao Viet Securities Nguyen Quang Vinh, the companies consulting Bao Viet are still ready for listing.

“It is quite a wrong viewpoint that companies should only list on the bourse when the market is hot,” Vinh said, adding that the companies which can meet the requirements for listing should still follow their listing plan.

Nguyen Van Dung, General Director of Tan Viet Securities Company, also said that the listing will not much affect companies’ business. Share prices are decreasing not because companies list or don’t list on the bourse.

Dung has reminded the companies which have decided to cancel their listing plans that share liquidity is a very important thing.

“It would be very dangerous if your shares cannot be sold or purchased. Investors will also not have opportunities to sell shares to get money to invest in other fields,” he said.

He added that the companies that got licences already but still hesitate to list will have their licences revoked. If so, they will have to follow the procedures again later when they change their minds, and it will take time. (DTCK)

Worry sparks over broker audit standards

Friday, April 25, 2008
A decision of State Securities Commission to authorise any independent auditing firms to audit publicly-held securities companies and fund management companies may result in poorer quality audits, some experts are warning.

The commission issued Official Dispatch No 657/UBCK-PTTT last week to accept independently-audited 2007 financial statements from all such companies.

"The decision could adversely impact the quality of audited financial statements because of the low standards of professional qualifications at different firms," said Bui Van Mai, director of the Ministry of Finance’s Department of Accounting and Auditing.

"Some auditing firms have been established for over a decade, with others were only set up two months ago. Some have dozens of auditors, others only three," Mai said.

Under the previous rule from the Ministry of Finance, around 141 independent firms were entitled to audit all kinds of enterprises, but only 26 companies were qualified to audit brokerage houses and fund management companies.

Nguyen Son, head of the market development department of the State Securities Commission (SSC), explained that the decision stemmed from the fact that the number of public firms was increasing strongly and there was huge pent-up demand for qualified auditors.

In fact, according to SSC statistics, there are now 904 unlisted and 300 listed, securities and fund management companies operating now in Viet Nam.

"It’s impossible for only 26 qualified firms to audit more than 1,200 public securities and fund management companies," said an expert from the SSC who asked to remain anonymous.

"We had no choice," he said, noting that this was an interim decision making it possible for companies to release audited 2007 financial statements no later than this month.

"The pressure to release the 2007 financial statements of public companies was high and the number of qualified auditing firms limited, so the SSC issued the decision," Mai agreed, however noting that the decision would have negative impacts on audit firms that have already made efforts to earn qualification for the list of 26 firms eligible to audit securities companies.

The decision should be only a short-term solution of a year or less, he said. Finding qualified firms meeting certain standards would be a long-term solution.

Auditor shortage

In 2005, only 200 new auditors were granted certificates, followed by another 250 in 2006. By last year, only 30 new auditors were licensed.

Many qualified auditors have also moved to other work in the financial, banking, and securities sectors.

Deloitte Viet Nam Co Ltd general director Ha Thi Thu Thanh said that "out of 141 independent auditing firms, only 28 employ more than seven auditors."

Thanh claimed that some independent auditing firms had been in operation only three years, with few experienced auditors, so the quality of their audits probably remained poor.

But, allowing more auditing firms to audit securities companies and fund managers should act as a "kind of unbinding valve [that] will help public firms published audited financial statements sooner, consistent with the Law on Securities," Thanh said. Most enterprises in Viet Nam end their fiscal year on December 31 of the previous year and are required to publish yearly financial reports in the early months of the following year, making them a peak time of auditing activity.

To ease the pressure, Mai advised businesses to select different fiscal years at different times of the year to audit and announce results, rather than everyone bunching up at the end of the year.

The 2003 Law on Accounting already permitted companies to select their own fiscal years to match business cycles.

"To change the fiscal year, enterprises only have to report to tax offices and then carry out accounting and auditing procedures normally under current regulations," Mai said.

"Companies around the world have selected their own fiscal years for a long time. I think that not only listed firms but also all other kinds of enterprises should change in order to follow international practice," Mai added.

Auditing firms should also merge to raise professional qualifications, Mai said. (VNS)