Illustrative image (Source: tinnhanhchungkhoan.vn)Hanoi (VNA) - Prime MinisterNguyen Xuan Phuc has approved a new plan that focuses on restructuring thesecurities market until 2025.
Under the new plan, numbered 242/QD-TTg, the Government wants to ensurecomprehensive restructuring of the securities market so that it becomes themedium- and long-term capital-raising instrument for the Vietnamese economy andbusinesses.
The Government also wants to make the securities market a tool to help itrestructure State-owned enterprises (SOEs) and divest from those companies,re-shape the country’s economic growth model, and help Vietnam become moreinteractive to regional and global markets.
Several milestones have been set in the document such as the value of the stockmarket is projected to reach 100 percent and 120 percent of Vietnam’s totalgross domestic product (GDP) in 2020 and 2025, and the number of listed companiesin 2020 rising 20 percent from 2017.
The Government also plans to launch new securities products such as coveredwarrants, government bond futures and new index-underlying futures.
There are eight solutions proposed in the document to shake up the domesticsecurities market, including the perfection of the legal framework;restructuring of goods and services supply; restructuring of securitiescompanies, market and investors; improvement of market management; andupgrading the market status based on global standards.
Among the items, restructuring of securities companies may be among the biggestconcerns for the market.
Under the new project, brokerage firms are required to reform their operationalmodels, improve their financial health, make stronger efforts in corporate andrisk management, and improve corporate transparency and performance.
Any unofficial capital sources for securities firms will be monitored closelyand the firms violating the market rules on margin lending will be fined morestrictly.
Brokerage firms, which have capital adequacy ratio (CAR) of more than 180 percent,capital of more than 1 trillion VND and no cumulative losses, will receivesupport from market regulators to expand their business, lead in introducingnew products and services to the market, become the founding members of thebond and derivative markets, and restructure poorly-performing securitiesfirms.
On the other hand, companies with below 180 percent CAR will be watched by themarket regulator and are disallowed to directly manage investors’ tradingmoney.
They are also restrained from making new investments, trading shares and payingdividends. In addition, those firms are banned from trading highly riskytransactions on the market.-VNA
Under the new plan, numbered 242/QD-TTg, the Government wants to ensurecomprehensive restructuring of the securities market so that it becomes themedium- and long-term capital-raising instrument for the Vietnamese economy andbusinesses.
The Government also wants to make the securities market a tool to help itrestructure State-owned enterprises (SOEs) and divest from those companies,re-shape the country’s economic growth model, and help Vietnam become moreinteractive to regional and global markets.
Several milestones have been set in the document such as the value of the stockmarket is projected to reach 100 percent and 120 percent of Vietnam’s totalgross domestic product (GDP) in 2020 and 2025, and the number of listed companiesin 2020 rising 20 percent from 2017.
The Government also plans to launch new securities products such as coveredwarrants, government bond futures and new index-underlying futures.
There are eight solutions proposed in the document to shake up the domesticsecurities market, including the perfection of the legal framework;restructuring of goods and services supply; restructuring of securitiescompanies, market and investors; improvement of market management; andupgrading the market status based on global standards.
Among the items, restructuring of securities companies may be among the biggestconcerns for the market.
Under the new project, brokerage firms are required to reform their operationalmodels, improve their financial health, make stronger efforts in corporate andrisk management, and improve corporate transparency and performance.
Any unofficial capital sources for securities firms will be monitored closelyand the firms violating the market rules on margin lending will be fined morestrictly.
Brokerage firms, which have capital adequacy ratio (CAR) of more than 180 percent,capital of more than 1 trillion VND and no cumulative losses, will receivesupport from market regulators to expand their business, lead in introducingnew products and services to the market, become the founding members of thebond and derivative markets, and restructure poorly-performing securitiesfirms.
On the other hand, companies with below 180 percent CAR will be watched by themarket regulator and are disallowed to directly manage investors’ tradingmoney.
They are also restrained from making new investments, trading shares and payingdividends. In addition, those firms are banned from trading highly riskytransactions on the market.-VNA
VNA
