Business sectors

 

SECURITIES SERVICES


2017 HIGHLIGHTS

 


SSI continued to reaffirm the No. 1 brokerage position in both shares and fund certificates on both HOSE & HNX. Combining both exchanges, the market share of SSI came out on top with a 15.26% penetration rate, up 2.22% compared to 2016.

 

Transaction values for the segment of domestic individual customers saw a dramatic growth at rate of 105% compared to 2016, and average margin loan balance increased to VND 4,150 billion from VND 3,294 billion. Revenue from Securities Services, accordingly, reached a striking growth to VND 1,328.2 billion in 2017 from VND 868 billion in 2016, leading to the increase in profit from VND 389.6 billion in 2016 to VND 655.5 billion in 2017.

 

In coordination with the Investment Banking, Securities Services made some successful divestment deals and distributed stocks of Vietnam National Petroleum Group (PLX - HOSE), Vietnam Dairy Products Joint Stock Company (VNM - HOSE), VietJet Aviation Joint Stock Company(VJC – HOSE), Vincom Retail Joint Stock Company (VRE – HOSE), Ho Chi Minh City Development Joint Stock Commercial Bank (HDB – HOSE) with transferable asset valued up to hundreds of millions of US dollars.

 

SSI represents the pioneer as continuing its leading position by the derivative brokerage market share, accounting for 28.28% of the whole market, with the number of new accounts opened on the first day of nearly 1,000. Up to date, the number of SSI accounts has surpassed SSI’s expectation with 6,000 new accounts, including over 1,200 active accounts and 625,000 securities trading contracts at SSI.  

 

A variety of new products on investment consultancy and advisory services have been developed for individual customers such as: Stock Ratings, Stock Quick View and investment recommendations based on fundamental and technical analysis that bring about short-term and long-term investment ideas to customers. SSI is the first company to draw up derivatives reports on the market, providing a wide range of trading information and strategies for clients. Investment advisory products, investment strategy reports, macro reports for institutional clients are always appreciated in terms of quality, credibility and professional ethics by customers and prestigious institutions in the region.

 

SSI Securities Services continued to win most of the prestigious awards in the individual and team categories presented by Asiamoney - a leading and prestigious finance magazine in the region. Besides the international awards, the Division was also given many awards by local authorities for excellent performance on underlying securities trading, derivatives trading and clearing and was named being one of top 10 leading securities companies in Vietnam.  
    

 


2017 PERFORMANCE
The Vietnam stock market experienced a year of spectacular growth at the highest rate in Asia. After 10 years, VN-Index returned to its peak of 970 points at the last month of 2017, up nearly 46% compared to the beginning of 2017, the market capitalization reaching VND 3,360 billion, which exceeded the targeted cap set out for the year of 2020. 2017 also witnessed many records of state divestment deals, namely, state divestment from Saigon Beer Alcohol Beverage Joint Stock Corporation (SAB - HOSE) - gaining USD 5 billion in proceeds, Vietnam Dairy Products Joint Stock Company (VNM - HOSE) - gaining over VND 20,000 billion, Development Investment Construction Joint Stock Corporation (DIG - HOSE) - gaining approximately VND 2,500 billion. In addition, secondary offerings of giant companies such as Vincom Retail Joint Stock Company (VRE - HOSE), VietJet Aviation Joint Stock Company (VJC – HOSE) or Vietnam Prosperity Joint-Stock Commercial Bank (VPB – HOSE) also created a boom for domestic and foreign investors. Besides the growth in the underlying securities market, the derivatives market was introduced to investors in August 2017. Only within 5 months, the size of the derivatives market grew exponentially, over 16,300 derivatives trading accounts opened with an average trading size of more than VND 1,600 billion/ session in December, 2017.


In addition to such advantages, the Vietnam’s stock market has still faced a variety of tangible and intangible barriers that create a major impact on the influx of foreign investment. In particular, the level of investment and disbursement of institutional investors in the market is limited due to investment size, small number of outstanding shares, low liquidity and limited foreign ownership of many blue-chip stocks. Besides, investors’ confidence has also been challenged by the delays of many important events during the past year, such as delays in divestment in state-owned enterprises; the introduction of derivatives products; day trading, etc.


2017 also marked a strong development of the Securities Services Division with tremendous growth in revenue, the continuously leading position by the market share, and the Division’s success in expanding the number of customers, building highly qualified brokers as well as developing new products.


Leading the whole market by market share

 


The market share in shares and fund certificates brokerage continued to reaffirm its highest position on both stock exchanges, reaching 15.26% - up 2.22% compared to 2016.

 


In which, the market share on HOSE reached 16.25%, up 2.56% compared to 2016.

 

 

While that on HNX reached 11.4%, up 0.37% compared to 2016.

 

Impressive growth in revenue and profit
Revenue from Securities Services continued its positive and ongoing pace of growth over the years, reaching VND 1,328.2 billion in 2017 – up 53% compared to 2016. In which, revenue from Retail Brokerage was mainly from brokerage fees and revenue from financial products. Revenue from Institutional Brokerage included revenue from brokerage fees for trading on and off the exchanges, revenues from advisory contracts, recommendations provided to investment funds, advisory services on investor relations for companies and cross-sale activities in coordination with other business units of SSI.

 


Along with the growth in revenue, the profit of Securities Services also achieved a robust growth in 2017, reaching VND 655.5 billion - approximately equal to the combined profit of the two previous consecutive years.

 

 

A dramatic growth in the number of customers and expansion in networks
By late 2017, SSI managed more than 127,000 accounts, accounting for 6.5% of total accounts of the whole market, of which 126,000 accounts were of individual customers and closely 1,000 accounts were of foreign institutional customers. In 2017, the newly opened accounts reached 26,515 in number - surpassing 30% of the target. The impressive growth in the number of customer accounts represents a proper development strategy through improvement of investment and consultancy services, financial products; the development of institutional brokers and retail brokers to take good care of existing customers as well as acquiring new customers.

 


Taking advantage of market development opportunities, SSI Securities Services has continued to expand its operating network at prime locations in Ho Chi Minh City. In September 2017, two Transaction Offices were established: Nguyen Van Cu Transaction Office and Nguyen Thi Minh Khai Transaction Office respectively; making up the total number of Branches/Transaction offices to 12 trading locations nationwide, which reaffirm the leading position of SSI in terms of trading networks with customers.

 

Growth in the number of retail customer brokers

Pursuing the strategy to invest in the quality of brokers, in 2017, SSI did not carry out large-scale recruitment, instead of that a process on thorough selection and rigorous probation assessment has been adopted, with a focus on such elements as ethics, professional competence, passion and desire at work. The number of brokers increased to 479 head-counts from 353 ones by the end of 2017. In conjunction with employee recruitment, broker training is always emphasized and periodically conducted at all branches and transaction offices, to orient the brokers to become financial consultants with high expertise, good professional ethics, consulting capability and customer care skills.


Institutional Customer Brokerage team is also strengthened with a pool of senior human resources being foreigners who have rich experience in international financial institutions to be in charge of developing overseas markets including the United States, Europe, Singapore, Hong Kong, etc.


Developing new products
Along with the advent of the derivative market, SSI was one of the first securities companies to be granted certificates by the SSC for trading derivatives and bridging derivatives transactions with the HNX, and was one of the two general clearing members of the market. SSI was also a pioneer in making and putting forward recommendations for the development of the derivatives market; for example, its proposal to the SSC on the supplement to the Circular that allows depositors to trade on margin through general accounts at the securities company to reduce transfer fees charged by payment banks and determines tax amounts per transaction, etc. By the end of 2017, SSI topped the derivatives market with a market share of 28.28% and over 6,000 accounts.


In addition, SSI is also the first securities company coordinating actively with HOSE to prepare readiness for the introduction of covered warrants which are expected to be launched to the market in May 2018.