Vietnam’s
securities regulator will submit plans to merge the country’s two stock
exchanges in an effort to improve the quality of listings after the benchmark
index fell by the most among Asian equity measures last year.
The Ho Chi Minh City Stock Exchange, the
nation’s main bourse, and the Hanoi Stock Exchange will merge in early 2013 if
the plans are approved by the government, Vu Bang, chairman of the State Securities
Commission, said in an interview at an equities conference in Hanoi Friday. The
regulator will seek government approval in the third quarter, Bang said.
The commission may also raise the minimum
registered capital for companies that want to list on the main bourse to at
least VND120 billion ($5.76 million) from VND80 billion from the second
quarter, while the threshold in Hanoi will rise to VND30 billion, he said.
Companies that are already listed in the two exchanges will have about five
years to meet the requirement, Bang said.
“The move is in line with models in the region
and in the world,” he said. Listed companies in Hanoi bourse will gradually
move to the Ho Chi Minh exchange in the “long run,” he said, without giving a
specific timeframe.
In Asia, Japan’s Fair Trade Commission last
month started the second phase of its review into the merger between the Tokyo
exchange and Osaka Securities Exchange Co., the country’s two biggest bourses.
Deals worth $37 billion have been proposed between global exchanges in at least
the past 15 months, with cross-border plans meeting resistance on the grounds
that they hurt competition.
Market rebound
The benchmark VN Index jumped 2.7 percent to
439.60 on Friday, extending this year’s rebound to 25 percent after the central
bank signaled it may cut borrowing costs. Inflation decelerated for a sixth
month, with consumer prices climbing 16.44 percent in February from a year
earlier, down from the previous month’s 17.27 percent.
“The monetary policy has been more flexible
and there have been signs that interest rates will drop,” Bang said. “The stock
market will have an opportunity to recover.”
The VN index slumped 27 percent in 2011,
making it Asia’s worst performer according to data compiled by Bloomberg.
The Ho Chi Minh City Stock Exchange has
increased its total number of listed companies to 303 companies from two when
it opened in 2000. The Hanoi Stock Exchange now has 395.
“The increase in listing standards is aimed at
raising the quality of listed companies,” the commission said in a document on
Friday.
Raising funds
As part of an attempt to boost the stock
market, Vietnam will merge and shut “weak” securities firms as it expects to
cut the total number of the firms from the current 105, Minister of Finance
Vuong Dinh Hue said at today’s conference.
“The government always considers the stock
market as an efficient channel to raise funds for the economy” and the health
and stability of the market are a top priority, Hue said.
Vietnam will extend trading hours on the two
exchanges from March 5 by adding an afternoon session, Bang said last month.
Prime Minister Nguyen Tan Dung today signed a
directive asking the Ministry of Finance and other ministries to implement a
strategy to develop the stock market in the 2011-2020 period, according to a
statement posted on the securities commission’s website. Dung also asked the
finance ministry to intensify supervision of the market and study a plan to
offer equity derivatives, according to the statement.
Bloomberg
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