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Confusion reigns over listing overseas
There are several obstacles facing efforts to harmonise regulations on firms listing their shares on domestic as well as foreign exchanges, experts say.
Relevant agencies are actively working to find solutions to facilitate Vietnamese firms wanting to list their shares in stock exchanges abroad.
Nguyen Ngoc Canh, Head of the State Securities Commission's International Co-operation Department, said his office was in the process of completing a draft on guidelines to implementing the revised Law on Securities for submission to higher authorities. Proposed adjustments to regulations on listing abroad would be released before the end of April for the public and other stakeholders to comment on, he said.
The regulations would allow for listing in overseas markets either directly or via global depository receipts (GDRs), depending on several criteria including a company's charter capital and corporate governance, Canh said.
Companies listing in other markets would also be required to report relevant information to the commission, he said.
The SSC has asked related institutions to develop their market infrastructure in order to meet businesses' demand for cross-listing, Canh said, adding that the exchanges in Ha Noi and HCM City as well as the Viet Nam Securities Depository Centre have been implementing a project to upgrade the technical infrastructure for trading, monitoring and information release.
Despite many difficulties, the GDRs of Hoang Anh Gia Lai (Listed on the HCM City Stock Exchange as HAG) became the first of Viet Nam to list on the London Stock Exchange last week, thanks to assistance from Deutsche Bank, its depository bank for the past two years.
According to an expert from that bank, HAG's GDRs listing on the LSE would help improve liquidity of the DRs held by foreign investors, and more importantly, open up opportunities for the company, as well as others that follow it, to access international capital sources.
Last year, firms listed on Viet Nam's stock exchanges mobilised VND116 trillion (US$5.5 billion), and many big firms plan to raise more capital this year. This can overload the domestic market, so foreign channels for raising funds can lessen the burden.
However, experts have pointed out that once a company lists on exchanges in the country and abroad, it will have to pay dividends to investors at the other exchange in foreign currencies, while the businesses' own demand for foreign currency, especially the US dollar, is still higher than supply.
Thuy Anh
vietnamnews
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