Stock market 2014: Transparency to bring back investors
Stock market 2014: Transparency to bring back investors
The improved transparency in the stock market has helped regain investors’ trust in 2013, and the trend will continue this year, said Chairman of the State Securities Commission Vu Bang.
Vietnam’s securities market is predicted to see a strong rebound after suffering slight losses.
The Government’s macro-economic solutions, including the more cohesive execution of financial and monetary policies, decreasing lending interest rates, tax rescheduling and debt restructuring in 2013 have laid sound preconditions for the stock market in 2014, Bang said.
Sharing the view, economist Vu Dinh Anh also underlined that a stable macro economy will be pivotal to the performance of the stock market when other rivalling investment channels are losing their attractiveness.
The property market, for example, is still struggling to get rid of the year-long stagnation while the gold market is affected by declining prices on the world market, according to Anh.
The experienced expert also projected that commodities on both stock exchanges in the country will be abundant with increasingly improved quality in 2014.
In the year, securities companies, financial institutions and enterprises with poor liquidity will be screened to raise the quality of the shares they post.
The expert also noted that the transparency level of the stock market will positively affect other sectors of the national economy.
It will enable investors to spot healthy entities while pressing on listed businesses to scale up their restructuring for better operations.
In 2013, the Government issued decree 108/2013/ND-CP, mandating sanctions against administrative infringes in securities operations and transactions on the stock market.
The document puts an end to the phenomenon that equitised businesses have repeatedly delayed their planned listing on the stock exchange s .
Vu Thi Chan Phuong, head of the Inspection Department of the State Securities Commission, said the decree is extremely important to the stock market as it creates an open and transparent environment to protect investors.
CEO of Hanoi Stock Exchange (HNX) Tran Van Dung noted the decree demonstrates the determination of the Government and the securities sector to defend the rights and interests of investors.
The decree requires those businesses which have already listed or plan to list on the stock market, to observe their responsibilities and obligations to investors, Dung said.
Together with the decree, the Prime Minister has given out instructions regarding the listing of commercial banks on the bourses in a bid to raise the transparency level and reduce overlap in ownership.
According to economic expert Nguyen Tri Hieu, commercial banks are not happy with the instruction but it is a necessary move, given that international norms require those who sell shares to the public to be listed in the stock market.
According to statistics released by Vietstock, only 29 out of the 694 listed companies on both national stock exchanges took the initiative to distribute compulsory information to investors, as required by Circular 52/2012/TT-BTC of the State Securities Commission about publishing information on the stock exchanges.
Those releasing information were mainly Ho Chi Minh City-listed companies, as opposed to only four listed on the Hanoi Exchange.
The remaining 95 percent of listed companies were found to have not released information. Experts noted that the numbers indicate that many listed companies are not properly serving their investors, which might cause their stocks to be undervalued.
Experts urged listed companies to pay attention to investor relations (IR), which would help ensure transparency and the rights of shareholders, while enhancing the image of companies in investors' eyes.
vietnamnet
