Securities firms not allowed to lend to stock investors: SSC

Securities companies are not allowed to lend money to customers to purchase securities, except for other rules issued by the Ministry of Finance.

This is one of the important contents of the draft circular on the regulation on organisation and operation of securities companies that the State Securities Commission has sent out for comments.

In addition, according to the draft circular, securities companies are not allowed to make agreement or give a specific interest rate or share profits/losses to customers to entice customers to participate in the transactions.

Moreover, securities companies are not allowed to provide financing or guarantees to shareholders either directly or indirectly; not to lend any kind of loans to major shareholders and members of the supervision boards.

Securities companies must have separate management of stocks and money of individual investors with cash and securities of securities firms, not allowed to use the transaction payment of customers and properties entrusted by customers.

Securities companies “tighten their belts”

A series of securities companies are now “tightening their belts” and downsizing their operations in the context of bearish securities trading.

In May alone, many securities companies announced suspension of transaction offices or affiliates such as Wall Street trading Office, Indo-China, ViettinBank Securities, Vietnam Star, Vina Securities and others.

Some securities companies have closed many of their transaction offices such as ACB Securities Company Ltd Which recently closed two transactions rooms (one in District 4 and one in District 5, HCM City). Previously, the company also closed one transaction in District 10, HCM City.

Thang Long Securities Company, the market leader in HOSE and HOSE for two consecutive years, also announced the closure of two offices in Hanoi and HCM City. According to some securities firms, narrowing the activities and personnel cuts are inevitable to reduce costs when liquidity in the stock market dropped sharply and stood at a low level in a long time. – Tuoitre

Tags: vietnam stock, Vietnam stock market, VNindex