The heavy losses in 2008 have prompted securities companies to look for foreign partners to help strengthen their capability. However, experts have warned that it is not easy to find foreign partners in 2009, when the global economies are expected to see a new difficult period.


Many securities companies have reported losses in 2008, the year when the VNIndex dropped by 66% and HASTC Index by 67.5%.


Hai Phong Securities Company (HPC), for example, reportedly incurred a loss of VND 119.8 billion, Kim Long Securities Company (KLS) VND 347.4 billion. Meanwhile, Bao Viet Securities Company, a big name, reported a loss of VND 452 billion.


The losses in 2008 have prompted companies to cut down their workforce and seek foreign partners, which they hope can help strengthen their financial capability and corporate governance skills.


“BVSC is seeking foreign strategic partners. Several foreign financial institutions have expressed their willingness to become strategic shareholders of BVSC,” said Pham Quang Huy, Deputy General Director of BVSC.


The deals wrapped up in 2008


In fact, the movement of seeking foreign strategic shareholders began in 2007 and continued in the first half of 2008.


Au Lac Securities Company sold 4.9 million shares, or 49% of its chartered capital to Cayman’s Technology CX, in the securities issuance to raise the chartered capital from VND 50 billion to VND 100 billion.


Huong Viet Company sold 14.5 million shares, worth VND 145 billion in face value, or 48.33% of chartered capital to Singapore’s Morgan Stanley Holdings. Click & Call Company sold 49% of its chartered capital to Southern investors, Golden Bridge.


Tan Viet Company sold 3.8 million shares, or 30% of chartered capital to VietBridge (British Virgin Island). Japanese Daiwa Securities Group and ANZ have become the strategic partners of Saigon Securities Incorporated, while Vietnam Securities Company transferred 49% of shares to Malaysia’s RHB.


Selling more in 2009? Not easy


2009 is being considered a more difficult year for securities companies than 2008, which has made people think that the stake sale tendency by securities companies will become stronger this year.


However, Louis Nguyen, Chairman and CEO of Saigon Asset Management (SAM) believes that Vietnamese companies should not seek foreign partners during this current unfavorable moment.


He said that foreign investors have suffered losses on international markets, and they may not be interested in making investments in Vietnam.


Johan Nyveen, General Director of HCM City Securities Company, also said that it is not so easy to sell small companies or companies that are on the verge of bankruptcy, unless it is now more difficult to obtain operation licenses.


He went on to say that in the context of the global financial crisis, investors will not think of injecting money in securities companies on a small market, which does not show development potential.