HA NOI — Many securities companies have ceased offering brokerage services following two years of declining stock values, but a number might be reconsidering the move after witnessing the recent market recovery.
This month, however, the nation's stock market has rebounded strongly, and many wondered whether some of these companies might return to the market and resume offering brokerage services.
However, Duong said, companies seeking to reconstitute a brokerage department would need to recruit new brokerage staff and restore information systems. "This is not easy to do," he said.
SME Securities Co and Ha Noi Securities Co were among the most recent to cancel their brokerage services. Slapped with multiple violations for failing to settle its transactions, SME Securities announced early last month that it would suspend brokerage services between March 1 and August 31. Ha Noi Securities Co, meanwhile, cancelled its membership on the Ha Noi Stock Exchange last month and ceased offering brokerage services on February 17.
Earlier, Dong Duong Securities Co and Truong Son Securities Co also halted brokerage operations and transfered their client accounts to other firms.
When the market fell into its prolonged decline, over 100 securities companies were competing for an ever-decreasing number of clients. In many companies, revenues from brokerage operations were not enough to pay custodian fees.
Independent analyst Do Minh Duong told the online newspaper Dien Dan Doanh Nghiep (Business Forum) that the elimination of some weaker players in the field was unavoidable since too many securities firms were operating in a relatively small market, with few unique products or services. — VNS