(VEN) - ‘Great ship, great wave,’ is a popular Vietnamese saying. In the business context, it means that a large-scale business should expect to face huge challenges. The Dai Viet Securities Corp. (DVSC) was once recognized as a great ship, and, like other securities firms, the company was suffering hard from the market slump that started in 2007.
The company is now struggling to regain its place in the Vietnamese securities market. Vietnam Economic News’ Nguyen Boi talks with DVSC Acting General Director Hoang Van Tu about plans and strategies that DVSC is adopting to restore its reputation.
What did the 2007-2008 stock market turmoil imprint on you?
Vietnam's stock market started to slide after hitting the all-time high of more than 1,100 points in 2007. The local economic turbulence in early 2008 coupled with the global financial crisis in late 2008 sent the country's major stock index spiraling down to 235.5 points in February 2009.
These market ups-and-downs left a trail of difficulties behind. Most securities firms were in the doldrums in 2008. Earlier success suddenly went sour.
I came to manage DVSC in May 2008 when the crisis was spreading. It really was a big challenge for those who had not prepared well to cope with it. The situation required new investment strategies, and new plans had to be come up with to execute these strategies.
Many stock trading companies found them stuck with a situation of insufficient liquidity due to the 2008 stump, and DVSC was not an exception.
Over the past four years since its inception, DVSC has gone from the sublime to the ridiculous. The most important thing is that DVSC has survived the severe conditions and stood firmly in the marketplace.
The recession could be painful for some but is in fact healthy in the long run. At DVSC, there are an emerging sense of optimism among the staff. Our staff members are determined to work collaboratively to the company's recovery. The ties between DVSC and its partners and investors have been tightened. Besides, DVSC has improved its services significantly. All of these provide a momentum for growth in 2009.
What achievements did DVSC obtain in 2009?
Surviving difficult times, once thought to be an impossible task, is a valuable learning experience for us about the severe damages that could be done to the stock market. It has called for a comprehensive overhaul of the company's operations.
DVSC has since set new goals and strategies. We have cooperated extensively with partners who have financial potential for mutual benefits.
DVSC has allied with the Great Trust Commercial Joint-Stock Bank (TrustBank) - a full-fledged banking institution with a strong foothold and reputation in Vietnam's financial market. TrustBank is an important partner that will back up DVSC to achieve its goals for the 2010-2015 period.
Other shareholders such as Power Company No.2 (also known as Southern Power Corp. - EVN SPC), Dai A Bank, Saigon Beverage Corp. (Sabeco) are also our strategic partners that are vital to DVSC's long-term development strategies.
Back to your question, DVSC gained steady growth in 2009 thanks to a better market condition, with the bottom line of VND50 billion and a market share of 1.5 percent.
What are DVSC's plans or targets for 2010 and the coming years?
The detailed plans need to be approved by at the annual shareholders' meeting before they can be public. But generally, we can say we are looking at a healthy profit of about VND60 billion this year.
Our focuses are capital increase, reorganization of operations, customer categorization, introduction of new products and services, and network expansion.
For the chartered capital, the goal is to add VND50 billion to our current paid-in capital, increasing it to VND300 billion by the year-end. It is expected to reach VND500 billion in 2011 and VND1 trillion in the 2012-2014 period. In preparation for that, we plan to list shares on the local bourse this year.
We are undergoing a major reorganization with a hope that it will make our operations and trading transactions safer and more efficient. At the same time, we are designing new products and services that will be a better fit for certain groups of customers.
We aim to build and develop DVSC into a popular brand name not only in the domestic financial market but also in the international marketplace.
What concerns you the most presently?
The local stock market has marked its 10th birthday but is still in its infancy. This suggests that there is much room for growth.
Over the past decade, the legal system for operations and public company governance rules have been established. More investors have joined the stock market, and the market has shown its important role in the country's social and economic development.
However, action and more efforts are required to give the market a much-needed boost to make it attractive to investors. What concerns me is that with the current rate of development, it is still hard for Vietnam's stock market to integrate into the international financial arena in 2012 as part of the country's financial market integration roadmap unless the Government takes bolder steps./.
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