Leading securities companies, including SSI Securities Corporation, are actively participating in this race by offering enticing promotions. SSI Securities Corporation provides a refund of up to VNĐ50 million in margin interest to investors.
The recent flourish of the stock market is pushing demand for margin loans, thus securities companies are preparing capital increases to meet the borrowing demand of investors.
Concerns have been raised about tightened margin lending policies by securities firms, but low interest rates and strong buying power from domestic investors may help offset those worries.
Strong margin lending by securities firms is considered among key factors for the market surge in the past quarter and counter the strong foreign selling pressure.
The spread of COVID-19 has severely impacted all global stock markets, with Viet Nam’s benchmark VN-Index on the Ho Chi Minh Stock Exchange losing a third of its value in January-March
Vietnam Airlines is among 51 stocks that had been barred from margin lending in the second quarter, according to the Ho Chi Minh Stock Exchange (HoSE).
The State Securities Commission (SSC) has issued a draft regulation requiring the initial margin ratio contracted by securities companies for margin lending to be at least 60 per cent, which is expected to take effect in early February.
Many securities companies have opted to issue corporate bonds to raise capital to finance their margin lending service, following upbeat forecasts for the market in 2018.
Margin lending reached more than VND17 trillion (US$805.7 million) in
the first 10 months of 2014, an increase of about 13 per cent over the
nine-month figure.