Despite complaints of an overloaded system that manages electronic trading on the securities market, investors will have to wait a little loner for capacity expansion, says State Securities Commission (SSC) Deputy Chairman Nguyen Doan Hung.
An upgraded system for both the HCM City and Ha Noi exchange can be in place as early as 2008, says Hung, which will cover all depository, clearing and trading activities.
"The market has grown so quickly that the existing infrastructure cannot fully cater [to demand],' says Hung.
In HCM City, the bourse can only handle batches of orders, which creates the "bottleneck" in the system.
"However, in building infrastructure, the bourses and in particularly securities companies should also take into account their own capabilities as well as the rate of growth of the market," he says.
The SSC is concerned that brokerages may not agree with the extra costs they will have to bear in order to expand their own trading capacity beyond the market's current growth rate.
Forced by limited space, some securities have adopted measures to screen out small clients. Sai Gon Securities Incorporated, the nation's leading brokerage, now requires clients seeking to open new accounts to place at least 100 million VND (6,260 US$) in deposit.
Hung says while waiting for the upgraded system, the SSC is working with concerned organisations to make it possible for brokerages to send orders directly to the bourses by mid-2006. This would speed up the time it takes to execute a trade by foregoing the additional step of securities companies sending orders to brokers at the trading centres who then submit the transaction.
Hung also says the HCM City Securities Trading Centre aims to begin order-matching in a continuous fashion by the second quarter. Currently, there is only a morning trading session with orders executed in three large batches.
The SSC is also preparing legal documents to allow investors to place orders via the internet and telephone. A draft decree will be submitted to the Government and is set to take effect this year, says Hung.
Source: VNA
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