Case Study - Vietnam Stock Market 2010
1. VIETNAM STOCK MARKET SINCE ESTABLISHMENT TO 2010
1.1. History of Vietnam Stock Market
Nowadays, Vietnam is practicing development with a need to transform the economy from the centrally planned and subsidized mechanism to the free market economy. Since its extensive economic reform 20 years ago, Vietnam has made many important changes to turn its economy into a market-oriented one, including reforming the banking system, adding more financial components, and launching its first stock market, named as Ho Chi Minh City Securities Trading Center (HSTC) on July 20, 2000.
Initially, two companies were listed, Refrigeration Electrical Engineering Joint Stock Corporation (‘REE’) and Saigon Cable and Telecommunication Material Joint Stock Company (“SACOM”). The market is closely supervised by the State Securities Commission (SSC). Established under the Vietnam Government’s Decree 75/CP dated 28 November 1996, the State Security Commission (SSC) is a securities market regulatory agency which is in charged with the mission of establishment, organizing and regulating securities and securities market operations. Before February 2004, the SSC had operated as an organ directly belonging to the Prime Minister. During this period, the SSC could not well regulate the market due to some structural weaknesses. The market’s growth by number of listed companies so far has been rather slow. In fact, at the end of 2000, merely five joint stock companies were listed, and joined by only five more in 2001. The year of 2002 was recorded as the more successful year of the STC, but just a further 10 companies to be listed.
Since 2004, SSC has become part of Vietnam’s Ministry of Finance. As of February 2004, thirteen companies have been licensed by both the State Securities Commission and HSTC. Of these, nine have capital of VND 43 billion (US$2.73 million) or more and have been licensed to conduct a full range of securities business including brokerage, advisory, fund management,
1.1. History of Vietnam Stock Market
Nowadays, Vietnam is practicing development with a need to transform the economy from the centrally planned and subsidized mechanism to the free market economy. Since its extensive economic reform 20 years ago, Vietnam has made many important changes to turn its economy into a market-oriented one, including reforming the banking system, adding more financial components, and launching its first stock market, named as Ho Chi Minh City Securities Trading Center (HSTC) on July 20, 2000.
Initially, two companies were listed, Refrigeration Electrical Engineering Joint Stock Corporation (‘REE’) and Saigon Cable and Telecommunication Material Joint Stock Company (“SACOM”). The market is closely supervised by the State Securities Commission (SSC). Established under the Vietnam Government’s Decree 75/CP dated 28 November 1996, the State Security Commission (SSC) is a securities market regulatory agency which is in charged with the mission of establishment, organizing and regulating securities and securities market operations. Before February 2004, the SSC had operated as an organ directly belonging to the Prime Minister. During this period, the SSC could not well regulate the market due to some structural weaknesses. The market’s growth by number of listed companies so far has been rather slow. In fact, at the end of 2000, merely five joint stock companies were listed, and joined by only five more in 2001. The year of 2002 was recorded as the more successful year of the STC, but just a further 10 companies to be listed.
Since 2004, SSC has become part of Vietnam’s Ministry of Finance. As of February 2004, thirteen companies have been licensed by both the State Securities Commission and HSTC. Of these, nine have capital of VND 43 billion (US$2.73 million) or more and have been licensed to conduct a full range of securities business including brokerage, advisory, fund management,