In 2017 the State Securities Commission (SSC) will focus on formulating a revised Securities Law along with further completing the legal framework on securities in tune with international practices.
This is one of various measures to strengthen Vietnam’s securities market in the time to come, SSC Chairman Vu Bang recently told local media.
The legal framework on securities will be further developed toward raising the transparency of information and the settlement of disputes, providing a basis for luring more foreign indirect investment in the securities market and developing new products, a derivative securities market and a corporate bond market.
A decree on corporate governance will be issued, Bang said.
To increase supply of products on the market and improve product quality, new methods will be applied to promote equitization and divestment of state enterprises in connection of listing and trading registration. Decree 145 on sanctioning equitized enterprises that delay their listing on the bourse will be strictly implemented.
Supervision of transparency of information in financial statements of public companies regarding equity use, information disclosure and corporate governance will also be enhanced.
In addition, the trading market for unlisted public companies (UPCoM) will be improved.
VietJet Air General Director Nguyen Thi Phuong Thao beats a gong to inaugurate the listing of shares of VietJet Aviation Joint Stock Company (VJC) at Ho Chi Minh City Stock Exchange__Photo: Hoang Hai/VNA
Particularly, according to Bang, the SSC is actively preparing conditions for putting a derivative market into operation. The legal framework for the derivative market has been basically put in place and guidelines on listing, transacting, membership, and clearing have been completed by the HNX and the Vietnam Securities Depository (VSD), he said.
The SSC has also completed a legal framework for deploying a trading system for covered warrants in last September, the SSC chairman said.
It will also study and step by step apply in 2018 the short-sale operation and some other market operations according to international standards.
The bond market will also be further developed through diversifying government bonds, developing corporate bonds, and finalizing a plan for opening a corporate bond trading market in 2018.
In a bid to develop and diversify the investor base and improve demand, the SSC will continue implementing solutions for lifting the level of Vietnam’s securities market from the frontier market level to the emerging market level. It will pay attention to developing professional investment institutions, including voluntary pension funds.
The SSC will issue regulations on credit rating and establishment of local credit rating agencies, the SSC chairman said.
Another measure is to develop and build capacity for the system of market intermediary institutions. The number of securities trading companies will be reduced and their service quality will be improved. A list of securities practitioners will be posted up in the SSC’s portal, Bang said.
The SSC chairman also revealed that the plan on consolidation of the two local bourses, Hanoi Stock Exchange (HNX) and Ho Chi Minh City Stock Exchange (HOSE), has been finalized toward founding a parent company with HOSE and HNX as its subsidiary companies.
This year, the SSC will increase the effectiveness of securities market management and supervision and strictly punish violations. It will study and establish principles and methods of calculating losses incurred by investors in relation to the four securities-related crimes stated in the 2015 Penal Code.
As of March 6, the VN Index stood at 716.29 points, the highest level in the past 10 years and up 7.7 percent from the end of 2016. Meanwhile, the HNX Index was at 86.55 points, an increase of 8 percent.
The stock market capitalization reached VND 2,260 trillion (USD 101 billion), equal to 50.3 percent of the national GDP, up 16 percent from the end of 2016 and is the highest-ever level since the market began operation.
By the end of February, a total of 708 stocks and fund certificates were listed on the two stock exchanges and 485 stocks were traded on the UPCoM market with the total listed value reaching nearly VND 778 trillion (USD 35 billion), up 7 percent from the end of 2016.
The market liquidation improved with the average transaction value of VND 7.365 trillion each trading session, up 49 percent from the same period last year and 6.6 percent compared with the average level of 2016.
In the first two months of 2017, the capital mobilization on the stock market reached VND 40.7 trillion (USD 1.8 billion), a year-on-year reduction of 27 per cent but the capital mobilization in February increased 79 percent from that of January.- (VLLF)