VietNamNet Bridge – Instead of waiting for the instructions from the watchdog agency, securities companies have been reshuffling their organizations themselves, which has helped them make profit again in the first six months of the year after a long period of taking loss.

Practicing thriftiness brings profit

A lot of securities companies have reported profits for the second quarter and the first half of the year. The stock market has been a little bit warmed up, which has brought more jobs and clients. Meanwhile, the contractionary policy also has helped cut down expenses.

In late 2011, warning was given about Rong Viet Securities Company’s shares (VDS) after the company reported the loss of 126 billion dong. With a lot of drastic measures taken, the company made a profit of 3.2 billion dong in the first quarter of 2012 and 105 million dong in the second.

Rong Viet’s General Director Nguyen Mien Tuan said that the company has cut down expenses to the deepest low, retaining one headquarter and three branches, while all the provincial branches have been shut down. The labor force has been cut to save money. Ineffective assets have been liquidated.  Meanwhile, the company is planning to increase the chartered capital from 350 billion dong at present to 700 billion dong in 2012.

Tuan went on to say that when no positive sign has been seen, practicing thriftiness and keeping cautious with investment plans are the best ways to survive.

In order to cut down expenses, APEC has laid off 120 workers, retaining 60 officers only. It has also shut down most of its branches, which has allowed reducing the corporate management costs from 7.7 billion dong to 4.7 billion dong in the first half of 2012.

APEC’s General Director said the company is still making profit after it decided to scale down the operation. The profits mostly have come from the deposits at banks and brokerage services.

Many other securities companies have also reported satisfactory profits. The Saigon Securities Incorporated has reported a profit of 331 billion dong, the HCM City Securities Company 204 billion dong, and Agribank’s Securities Company 47 billion dong.

It’s still unclear about the future

The VN Index increased significantly in the first four months of the year, but the increase has slowed down since mid May. Therefore, when predicting the business performance in the second half of the year, the director of a securities company said the profit would be lower than that in the first months of the year.

The director said the VN Index is not likely to increase significantly partially because of the unclear macroeconomic factors. Bank deposit now is the main source of income of securities companies. Meanwhile, the deposit interest rates have been slashed continuously as per the request by the State Bank in an effort to loosen the monetary policies to revive production.

Therefore, securities companies are seriously thinking about merging into others to become stronger.

At the APEC shareholders’ meeting held in early 2012, a lot of shareholders were surprised when they were informed about the plan to merge into other companies.

Lang of APEC said this is the quickest way to expand the operation and increase the brokerage market share. APEC is now negotiating with a company which has smaller capital than APEC, but it has been operating well. Sources said the other company has the chartered capital of 100 billion dong, lower than APEC which
has 390 billion dong.

Compiled by Ngoc Mai