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Securities companies: superfluous or insufficient?
The decision by the State Bank of Vietnam to halt licencing new banks has been applauded by experts, who are expecting a similar decision in regards to securities companies.
Secretary General of the Vietnam Association of Securities Business (VASB) Nguyen Thanh Ky, who many times has urged the State Securities Commission (SSC) to stop licencing securities companies, joked that if SSC does not stop licencing, there will be no more names for companies.
Ky said that if SSC had stopped licencing securities companies right in 2007, there would not be as many companies as nowadays, and the companies would not be as miserable as they are now.
He added that the state management agency should have drawn lessons from the Chilean stock market and released a timely decision on halting the licencing of securities firms.
Sharing the same view, Nguyen Hoang Hai, Secretary General of the Vietnam Association of Financial Investors (VAFI), said that the state management agency should have considered the market demand to decide how many companies to licence. He said that SSC should have installed barriers immediately when it saw a wave of new securities firms being established.
Ky said that the central bank has made a wise step in halting licencing banks, as a lot of banks have been established in the last three years. As for securities companies, Ky said that Vietnam does not lack securities companies, but it lacks high-quality companies.
In fact, VASB many times has asked SSC to stop licencing securities companies, but the only thing SSC has done is to increase the requirements for setting up securities companies.
Under the current regulations, by 2009, securities companies will have to have the required chartered capital of VND300bil and meet other strict requirements.
However, observers say that VND300bil in chartered capital will not be able to limit the number of securities companies established.
Hai from VAFI said that the required chartered capital should be much higher, VND700bil or VND1tril, if SSC really does not want more companies to be born.
VNN
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