More banks to list on stock exchanges

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However, the quick recovery shown by the country's economy and the need to improve their position and competitiveness in the market have prompted them to list their shares this year.

The HCM City Housing Development Bank (HDBank) typifies this trend. Chairwoman Le Thi Bang Tam said HDBank planned to raise its charter capital from the current VND3 trillion ($142.85 million) to VND4 trillion ($190.47 million) and prepare necessary conditions to list on the official bourses.

The bank expects that its listing plan will go smoothly partly because of its achievements last year.

In 2010, HDBank earned profits of VND351 billion ($16.7 million), VND51 billion ($2.42 million) higher than the set target, Tam said.

The Military Joint Stock Commercial Bank (MB) also delayed its listing plan last year and is set to do it this year.

MB deputy general director Cao Thi Thuy Nga said last year the stock market had faced many difficulties, and the bank did not have the right conditions for listing on the official bourse.

The bank's management board had asked for permission from its shareholders to continue preparing for listing this year, Nga said.

The Technological and Commercial Joint Stock Bank (Techcombank), one of the big joint stock banks, also wants to go public soon.

"We are making careful preparatory steps to ensure that the listing plan can be implemented successfully this year," said general director Nguyen Duc Vinh.

Most of the banks planning to list see it as a necessary move to improve their liquidity, polish their trademark and sharpen their competitive edge.

Experts said both the MB and Techcombank were now appreciated by industry insiders for achieving high growth rates and earning attractive profits of VND2 trillion ($95.23 million) and VND2.8 trillion ($133.3 million) respectively, both exceeding set targets.

They also said, however, that listing on the official bourse would not be an easy task as it depended on market developments.

The Viet Nam Commercial Joint Stock Bank, for instance, had listed on the Ha Noi Stock Exchange in the fourth quarter of last year in an attempt to raise its charter capital.

However, the listing did not go very well because its share price stayed equal to the face value of VND10,000, reflecting the market's gloomy outlook.

Online buying flourishes

Motorbikes, clothing, handbags, shoes – these kinds of consumer items were being increasingly bought online in Viet Nam over the last few years, thus the product and services range has widened considerably since.

Online purchases can now include gift hampers, house cleaning, carpet washing, changing bank notes into crisp, new smaller denominations and car rentals.

A few years ago most Vietnamese residents were unfamiliar with online shopping. However, thanks to aggressive development of the e-ecommerce industry, online shopping has gained increasing popularity, and this is clearly seen in the increased rush during the Tet (Lunar New Year) festival season.

Marketing manager of the online shopping website 123mua.com.vn (123-buy) Phan Thi Nhat Linh said her website had about 15,000 e-stores, each stocking more than 100 products.

She said the number of products offered through her website had increased significantly for the Tet festival.

Ho Tan Duong of sieuthinhanh.com (quick supermarket) said online orders from customers living in HCM City usually took only a day to process and deliver. Without the overheads of renting retail space and hiring shop assistants, the prices of his products were lower than those at traditional shops, he said.

Duong said there were currently more than 500 stores on his website, offering cosmetics, shoes, bags, household commodities and electronic products. All products are discounted by 5 to 50 per cent, with some including gifts with purchase incentives, he said.

"There is now a more diversified collection of online goods compared to a few years ago. In particular we are offering many new products and services to meet our customers'needs for this Tet," he said. "That allows shopping site owners to launch a lot of promotional campaigns to increase competitiveness and attract more visitors."

Other sales website like Vatgia.com, muare.vn, rongbay.com and enbac.com are also offering a diverse range of products and services that can meet most consumers' Tet needs, including sausages, glutinous rice square cakes, flowers and bonsais.

Vatgia.com representative Nguyen Hoa Binh said that his website now had over 400 shops specialising in selling products for Tet with the participation of over 250 suppliers.

To attract more customers, Vatgia.com has introduced many sales promotions as well as insurance to ensure online buyers can receive quality products at reasonable prices.

Rongbay.com is offering the exchange of old banknotes for new ones for commissions of 1 to 7 per cent of the value. On muare.vn, customers can buy peach blossom branches or plants.

Website owners said gift baskets costing between VND150,000 ($7.1) and VND2 million ($95.2) were most looked for by online customers.

Market watchdogs said that payment safety as well as suppliers' reputation were key to the success of online trading.

"While online shopping can help people save time, the shoppers do not have the opportunity to see the goods with their own eyes to check their quality. So ensuring high product quality will gain the trust of customers," they said.

Establishing intermediary internet payment gateways between sellers and buyers via banks was also very necessary to ensure the security of buyers' payments, they added.

Online payment gateways also encourage enterprises to further invest in online sales channels that are said to have great potential for development in the coming time.

Gold rush losing steam?

Gold prices have continued to drop in the early days of 2011. This is quite different from previous years when prices of the precious metal increased along with demand, particularly during the Tet season, thanks to the payment of bonuses.

Early January, the domestic gold price was VND36.3million ($1,728) per tael, but it has since dropped to VND35.4 million ($1,685). The drop is partly due to continuous price drops in the world market. (One tael equals 12 troy ounces).

Since the beginning of the new year, international investors in the world market have tended to sell gold more than they bought. For instance, the SPDR Gold Trust – an initiative of World Gold Trust Services, from January 4-20, sold 29 tonnes of gold but bought only in dribs and drabs. This action has certainly affected the circle of investors and other financial organisations in the world, encouraging them to sell their gold as well.

In addition to the decrease in the world gold prices, independent market watchdogs also felt domestic gold prices could drop further since the current domestic rate was still VND1.1 million ($52.3) a tael higher than the global rate.

In 2010, gold traders imported or bought gold from people at high prices so the domestic rate did not drop as much as the world prices.

Now, although domestic gold prices have dropped, the market's purchasing power does not seem very high, and this has been attributed to public expectancy that the prices will drop further.

Meanwhile, some financial analysts think the economic recovery has encouraged investors to shift from gold trading to traditional areas such as the real estate or stock markets.

However, there are other experts who predict world gold prices will continue to increase because inflation is likely to rise all over the world. Gold is still considered the safest investment in reducing losses from inflation.

Experts from major banks also said that the gold price might increase again since many people would seek to buy gold when prices stood at an attractive level. Gold prices in 2011 would likely remain at over $1,400 per ounce, they said.