Largest Securities Firm Lists on Bourse

 

As the first securities company to be set up in Ho Chi Minh City in 2000, SSI now has a chartered capital of VND500 billion (US$31.25 million) and is rated the most reliable securities firm in Vietnam. SSI is now managing 68 per cent of accounts opened by foreign investors on the Vietnamese stock market. The brokerage service of SSI accounts for over 27 per cent of the market share of listed stocks. In the field of financial consulting, SSI has given consultancies to 17 out of 59 listed companies, accounting for 65 per cent of the listed stocks in the Ho Chi Minh City Securities Trading Centre (HSTC).

 

The business was very optimistic in 2005 and in the passing months of 2006. As of November 30, 2006, SSI recorded a total pre-tax profit of VND202 billion (US$12.63 million), exceeding 200 per cent of the target set by the general shareholder meeting for 2006. The revenues from the financial consulting activities increased 80 per cent, revenues of issuance guarantee are up 70 per cent, brokerage up 100 per cent; portfolio management activities up 3,400 per cent and self-business up 600 per cent compared with the entire 2005.

 

Before going on the bourse, SSI had more than 2,000 shareholders and its shares have been actively transacted on the over-the-counter (OTC) market. We selected the Hanoi bourse because if we listed our shares on the Ho Chi Minh City floor, SSI would need an independent consultant. But until now, we have not sought out a reliable consultant. And in fact, each transaction floor has its own advantages.

 

The competition on the stock market is becoming increasingly stiff. Apart from 18 operational securities firms, three new securities firms have been awarded licences in principle and many others have been applied for the formation of securities firms. SSI now has the largest chartered capital on the market and has typical customer and service target.

 

However, securities companies set up by State-owned banks, commercial joint stocks banks or State-owned corporations have more advantages over SSI because they are provided funds for operation, network expansion, customer support and customer seeking. At SSI, the business results depend on several top leaders of the company; hence, the risk may occur when these top officials changed their jobs. However, SSI has built an attractive mechanism and policies for top-ranking officials to reduce such a risk.

 

SSI has set its target to become a leading financial group under the model of the investment bank in Vietnam, providing investment, consulting, issuance, insurance guarantee and capital management services. SSI will hold the ownership of a securities service company and fund a management company.

 

SSI will split its services and set up independent joint stock companies to provide such services in 2007 when the Securities Law takes effect. Possibly, SSI will operate as a holding company. The holding company will provide financial consulting services for enterprises. Its subsidiary companies comprise of the SSI Securities Service Company to provide brokerage and investment services, the SSI Fund Management Company and other member companies.

 

In the forthcoming time, SSI will raise its capital for business expansion by issuing convertible bonds worth of VND500 billion. In the future, the company will raise its chartered capital to raise more capital for business expansion. SSI hopes its chartered capital of VND500 billion and a dividend of 30 per cent in 2006; VND800 and 30 per cent in 2007; and VND1,200 billion and 30 per cent in 2008, respectively.