Vietnam Allows Stock Brokers to Resume Margin Trading, Repo
The State Securities Commission (SSC), the stock market regulator, has finished legal documents on margin trading and repo services which will be provided by local securities companies soon, the Securities Investment newspaper reported Thursday.
Brokers and banks will initially be allowed to provide the services against bonds before expanding it to some symbols of shares, the SSC said, but did not disclose when the relaxation will take effect.
Resuming the margin trading and repo services will help boost the market liquidity and improve brokers’ income, which has been hit hard by the market’s nosedive, said Phan Quoc Huynh, director of Vietinbank Securities Co.
Stock prices have fallen to very low levels, but investors do not have more money to buy them, he said, adding that the services will help increase the market demand.
Though the regulator imposed the ban on the service provision last October to ease the volatility, many securities firms backed by banks have continued to lend securities investment.
Sacombank Securities Co. currently lends against 15 large caps on the Ho Chi Minh Stock Exchange and some unlisted stocks, including Eximbank, Military Bank and Habubank. (Securities Investment)
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