SSC approves new fund

The new securities fund is expected to boost the local market

The company, also known as Vietcombank Fund Management (or VietCapital), has a chartered capital of VND8 billion ($500,000), with 51 per cent coming from Vietcombank and the remainder being provided by Singapore’s Viet Capital Holding Pte Company.
The firm, the second joint-venture fund manager and the sixth of its kind in Vietnam, will manage investment funds and provide financial consulting and investment services.
To prepare for the new firm, Vietcombank has placed some advertisements in local newspapers to find experts and specialists for the venture.
“We expect to get a licence soon, as the government favours a plan to develop Vietcombank into a strong financial group,” said a venture executive who wished not to be named.
He confirmed to Vietnam Investment Review last week that his firm had already registered with the stock market watchdog for a VND200-billion ($12.6 million) member fund.
The fund, which will have at least 10 contributors, will invest all of its capital in listed and to-be-listed securities, he said.
“Vietcombank will issue convertible bonds in the middle of this month, and we are now busy with the preparations. So, the debut of this fund management offshoot will be delayed until early next year,” he said.
Vietcombank is striving to become the first and biggest financial group in Vietnam by launching a range of various business activities.
Banking will remain the core field of the future Vietcombank group. With an asset growth rate of 15 per cent per year, it is estimated that Vietcombank’s total assets by 2010 will reach between $30-32 billion.
Apart from banking services, Vietcombank currently runs a financial firm in Hong Kong, a significant financial hub in Asia and the world, which serves to boost trade and investment ties between Vietnam and Hong Kong, as well as between Vietnam and China. Vietcombank also operates a securities company, financial leasing company and an assets management company.
Under the plan to develop into a group, Vietcombank will be allowed to set up an investment fund management company, life insurance firm, financial and money transfer company, real estate investment capital management firm, and a credit/bank card company.
Apart from Vietcombank, a number of other Vietnamese financial institutions are planning to join forces with foreign partners to establish fund management joint-ventures in a bid to cash in on the growing local financial market.
The state-owned Vietnam Bank for Investment and Development (BIDV), for example, has a plan to set up a joint-venture with an American partner.
A BIDV executive said preparations for the venture were now speeding up and it expects to launch operations by the end of this year.
The executive added that potential partners are being contacted to raise an investment fund, which is expected to comprise around $200 million. The new fund will focus on listed and unlisted securities, real estate and natural resource exploitation.
Including VietCapital, SSC has already granted licences to six fund management firms. The other four are VietFund Management – a joint-venture between UK’s Dragon Capital Ltd and Sacombank – Prudential Vietnam Fund Management, Manulife Vietnam Fund Management, privately owned Thanh Viet Fund Management Company and Bao Viet Fund Management Company.