No activities at the headquarters, no answer to the calls, no news on websites – some securities companies have quietly disappeared from the market.

The Ministry of Finance has recently stated that it will restructure the stock market and securities companies. However, before the watchdog agency sets out to do the restructuring, securities companies have voluntarily left the market.

Disappeared

Some people, who were interested in the operation of securities companies, were so surprised when they could not see any officer of the Hanoi Securities Company (HSSC) at its headquarter – the third floor of the Opera building at No 60 Ly Thai To street in Hoan Kiem District in Hanoi. 

The office was locked, though it is still the headquarters of the securities company.

The phones at the office still ring, but there is no answer. The official website of the company is inaccessible.

Local residents, who live near the building, said that the securities company has left the building for one month. Its new head office is located at the building at No 141 Le Duan Street in Hanoi. This is really a quiet leave, because there has been no official information about the relocation of HSSC so far.

In fact, most investors know that HSSC and some other securities companies have stopped transactions for a long time and have stopped providing most of their services, including brokerage service, and have transferred clients to other companies.

Just before the Tet holiday, after HSSC decided to stop providing brokerage service since December 9, 2011, most of its clients came to close accounts at the company. Those, who could not come, have seen their accounts transferred to Thien Viet Securities Company.

The Hanoi Stock Exchange has also stopped the transactions of HSSC following the proposal of the company, so that the company can follow necessary procedures to terminate its membership on both the listed bourse and the UpCom, commencing from February 17, 2012.

Some securities investors say they feel shocked when more and more securities companies are disappearing from the market.

A new wave of elimination

The stock market recently has witnessed the big difficulties faced by securities companies.

Most recently, SME Securities continuously received new orders from the State Securities Commission (SSC). It had to stop transaction activities, then stop the offset payment operation, and then saw the certificate on depository service. Finally, it has been ordered to stop transactions at the HCM City Stock Exchange HOSE since February 10, 2012, to follow the necessary procedures to terminate its membership, because of the continued violations and insolvency. 

SME has also decided to halt the brokerage service and shut down the HCM City branch.

HOSE has also announced the stop of transactions of Dong Duong Securities DDS, so that the company follows the necessary procedures to terminate its membership

Gia Anh and Truong Son have quitted from the brokerage service.

Other companies have shut down a series of branches, transaction offices, laid off officers and relocated offices to the areas far from the central area.

In an announcement released before Tet holiday, Me Kong Securities Company said it would relocate the head office in district 1 in HCM City to the Ngo Quyen branch in Hanoi. With the decision, Me Kong has shut down two branches at the same time, including one in HCM City and the other in Hanoi, and one transaction office.

In fact, the bad performance of securities companies is foreseeable. The warnings about the difficulties were once raised several years ago, when investors rushed to set up securities companies. Analysts warned that 100 securities companies would be too much for a small market with few commodities like Vietnam.

However, ignoring the warnings, securities companies still mushroomed, while big money has been spent to lease business premises, pay officers and buy material facilities. 

Source: VNN