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    Five major banks in Vietnam's north and south cities, the first Chinese brokers to enter Vietnam

    2019-04-15 07:47:50

    Securities TimesLin Gen Wei Shuguang Chen Dongsheng

    Walking in the streets of Hanoi and Ho Chi Minh City, the visitors are most impressed. In addition to the long motorcycle army, there are many banks like Mipu.

    During the interview with the Securities Times reporter in Vietnam, they lived in a hotel in the first county of Ho Chi Minh City. The road in front of the road was less than 400 meters away, and there were 4 banking halls and 4 independent ATM outlets.

    In such a competitive environment, Chinese banks have initially completed their layout in Vietnam. "China's five major state-owned banks have set up branches in Vietnam, and such concentration is rare in developing countries," a senior executive of a state-owned big bank in Vietnam told Securities Times.

    In addition to banks, Chinese-funded companies have also taken action in the Vietnamese securities industry and have already owned five local securities companies.

    Five major banks gathered in Vietnam

    The Vietnamese financial industry is highly open to the outside world, and many foreign banks have branches in Vietnam. Du Baoyu, vice president and research director of Vietnam Construction Securities, said that banks in many countries and regions have set up branches in Vietnam, with the largest number from South Korea and Taiwan.

    With the opening of the China Agricultural Bank Hanoi Branch in May last year, China's five state-owned banks – “China Agriculture and Industry Construction and Trade” have all established branches in Vietnam, and the number of local branches has increased to seven. among them,Bank of China(Hong Kong stocks 03988) (3.870, 0.01, 0.26%),Construction bank(Hong Kong stock 00939) (7.220, -0.01, -0.14%) andBank of Communications(Hong Kong stocks 03328) (6.290, 0.00, 0.00%) branches are located in Ho Chi Minh City.ICBC(Hong Kong stocks 01398) (5.730, 0.00, 0.00%) andAgricultural Bank of ChinaThe branch of Hong Kong stocks (01288) (3.740, 0.01, 0.27%) is located in Hanoi. In addition, ICBC and ABC also have one office each.

    It is understood that except for a small number of executives and employees from China, most of the five banks are recruited locally and localized. When the Securities Times reporter visited the business halls of two state-owned big banks in Vietnam, they noticed that many employees at the bank counters could speak fluent Chinese.

    A person in charge of a Chinese state-owned big bank in Vietnam told the Securities Times that there are three main advantages of Chinese banks in the local area: one is to have a comparative advantage to local Chinese corporate customers; the other is to serve as an international big bank for international settlement business. There are advantages; the third is that Chinese banks have higher ratings in the international market and have advantages in raising foreign currency funds for clients.

    When talking about the supervision of the banking industry in Vietnam, another Chinese state-owned big bank Vietnam branch executive introduced that the local bank loan rate was high. After the global financial crisis broke out, the regulatory authorities rectified the banking industry and divested the non-performing assets. Dispose of a dedicated asset management company within a certain period of time, and limit cross-shareholding between banks, and forcibly merge banks with high non-performing rates. According to the official calibre, the level of non-performing loans in the local banking industry has dropped to 3%.

    Chinese-funded securities companies increased to five

    After the reshuffle of the securities industry during the last bear market, the number of Vietnamese securities companies has dropped from more than 100 in the peak period to the current 74, and 30 listed brokers. Among them, the brokerage leader is Saigon Securities (SSI). The company's registered capital is 1.445 billion yuan, and its after-tax profit last year was more than 400 million yuan.

    The Vietnamese regulatory authorities are stricter in the management of securities dealers. It is more difficult for foreign investors to establish new brokers in the local area, but foreign investors are allowed to hold local brokers. The reporter was informed that there are currently 13 foreign-controlled brokers. Among them, the number of brokers holding Korean capital is the highest, reaching 6; there are 5 Chinese-funded holdings (excluding Taiwanese capital, the same below); Japanese and Chinese Taiwanese holding one each.

    The five Chinese-controlled brokers are Vietnam Investment Securities, Vietnam Construction Securities, Southern Securities (FUNAN), Gateway Securities (formerly known as Wozhong Securities) and Yuexin Securities. Among them, Vietnam Investment Securities and Vietnam Construction Securities are listed brokers.

    During the interview in Vietnam, the Securities Times reporter was informed that there are also domestic companies visiting Vietnam in the near future, planning to acquire a local brokerage license.

    It is understood that Vietnam Investment Securities is actively promoting the introduction of strategic investors. In July last year, the company’s general meeting of shareholders passed the issuance plan and introduced the strategy.Guotai Junan(Hong Kong stocks 02611) (20.290, 0.13, 0.64%) International as a major shareholder. Guotai Junan International (Hong Kong stocks 01788) said in the 2018 annual report that “actively explored the Southeast Asian market and launched a project to acquire a majority interest in a Vietnamese financial services institution. After the successful acquisition, the Group will become the first Chinese brokerage to enter Vietnam.” Hao Dan, chairman of Vietnam Investment Securities, said to the Securities Times reporter that the introduction of Vietnam Investment Securities to Guotai Junan International is progressing smoothly and is now awaiting approval from the Vietnamese regulatory authorities.

    Vietnam Construction Securities was listed on the Hanoi Stock Exchange in March. In recent years, the company has carried out two capital increases and plans to continue to increase capital in the coming year. The goal is to become one of the top ten brokers in Vietnam before and after 2020. Last year, the company turned a profit, with a net profit of about 1,524,300 yuan.

    Hot searchFive major lines Vietnam Chinese brokerage

    Editor in charge: Shen Xuejiao RF13056

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