VietNamNet Bridge – Tran Dac Sinh, Director of the HCM City Securities Trading Centre (HSTC), said that HSTC would become the HCM City Stock Exchange, a company with the total chartered capital of VND1tril ($62.5mil).
How different will the HCM City Stock Exchange be from the current HSTC?
The stock exchange will be a legal entity, State owned, structured as a one-member limited company. It will operate under the Securities Law and Enterprise Law, and have the total chartered capital of VND1tril. The difference between the stock exchange and the trading centre lies in the fact that the stock exchange regulates the market directly, but operates like an enterprise. This enterprise can set up regulations at its level which helps it regulate and supervise market operations. The stock exchange can set up rules for the market, for listing companies and its members. If you want to join the market, you have to follow our rules.
The second difference is that the stock exchange will have autonomy in its operations. Until now, HSTC has always needed to get approval from higher levels for everything, even when it just needs to hire one new staff.
Could you please tell more about that: how has HSTC been fed, from the State budget or membership fees?
Until now HSTC has been fed by the State budget. However, the situation will be different: the stock exchange will feed itself by collecting fees. In fact, now HSTC collects fees from its members, but it has to pay them back to the State, and when it needs money to do something, it has to ask for money from the State.
HSTC now collects listing fees and member fees (VND20mil or $1,250 a year), everyday transaction fees (securities companies have to pay HSTC 20% of the total brokerage fees they get every day), and other kinds of fees.
In other countries, stock exchanges auction the seats on trading floors. Will the HCM City Stock Exchange think of selling the seats or will it still provide free seats?
 | | Mr Tran Dac Sinh | I know this. In Thailand, the stock exchange collects $80mil a year from seats. The figure is bigger in Singapore, $1bil a year. HSTC plans to collect some VND150bil ($9.37mil) this year, double that of 2006. The stock exchange will not increase the fee level, but will reduce the fee as the market becomes bigger and there are more and more listing companies. It is estimated that the fee volume to be collected will steadily increase. By May 18, 2007, there had been 86 brokerage tables of member companies put at HSTC.
Some experts said that HSTC decided to delay the application of the real-time order matching scheme for fear of losing control. With there be any changes with the mode of transaction once HSTC shifts to operate as a stock exchange?
The preparatory work for the new transaction scheme has been completed. We are ready now, and we just need the nod from the State Securities Commission (SSC) to put the scheme into operation, maybe in early June 2007.
HSTC, and the HCM City Stock Exchange in the future, has been given the right to licence listing companies. Will the stock exchange, running after profits, try to licence on a massive scale, ignoring the requirements for listing companies?
We will only licence the companies that can meet the set requirements. Under the current regulations, a company must have the minimum capital of VND80bil ($5mil) to be eligible to list on the bourse, but the required capital may be higher in the future. The stock exchange will be known as a place where big and profitable companies gather – the most outstanding companies of national economies.
In the future, there will be indexes of different sectors: indexes of blue-chip groups, for example, the index of the 30 companies which have the biggest market capitalisation volume. It is likely that the stock exchange will have another trading floor for smaller-scale enterprises.
Enterprises should understand that only selected companies will be able to list at the HCM City stock exchange, not every company can list there.
Will the HCM City Stock Exchange cooperate or set up a joint venture with foreign partners?
We have signed cooperation agreements with stock exchanges of many countries in the world, mostly on training, technical assistance and information exchange. The cooperation will help Vietnamese companies list on foreign bourses, while creating favourable conditions for foreign companies to list on Vietnam’s bourse.
Will there be any changes in the stock exchange’s capital structure in the future? If yes, will the stock exchange sell shares to its members and investors? Will the diversification of capital sources affect the objectiveness of the stock exchange in regulating the market?
It is expected that the stock exchange will be equitised in 2010. The stock exchange’s stock will be sold to members and the public. The equitisation of the stock exchange will be guided by the Prime Minister.
(Source: TBKTSG) | 
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