Merrill wins nod to trade Vietnam stocks http://today.reuters.com/news/articleinvesting.aspx?type=newIssuesNews&storyID=2006-08-11T090258Z_01_T165737_RTRIDST_0_FINANCIAL-VIETNAM-MERRILL.XML
Fri Aug 11, 2006
HONG KONG, Aug 11 (Reuters) - Merrill Lynch (MER.N: Quote, Profile, Research), a top Wall Street firm, on Friday said it had been granted approval to trade Vietnam-listed stocks as a foreign investor, giving it access to a growing $2.5 billion market.
Merrill, which this year issued a bullish report on Vietnam's prospects, said it was one of the first international financial services companies to be granted a so-called securities trading code.
"With the trading code, we will strengthen our presence in Vietnam and better serve our clients by offering them access to this developing growth market," Paul Masi, head of Asia Pacific equities, said in a statement.
Merrill called Vietnam a "10-year buy" in a research report earlier this year, citing positive policy reforms, fast-growing domestic consumption and developing capital markets.
Credit Suisse (CSGN.VX: Quote, Profile, Research) estimates that there will be $5 billion to $6 billion in state privatisations from Vietnam in the next two to four years.
However, the market is still very small -- its stock market capitalisation of $2.5 billion is less than 4 percent of Merrill's total value -- and there have been a few bumps in the road as foreign players move in to the communist-run country.
Industrial & Commercial Bank of Vietnam (Incombank), the country's fourth-largest lender, last week filed a lawsuit against Dutch financial services firm ABN AMRO (AAH.AS: Quote, Profile, Research), seeking compensation over foreign currency trades that allegedly caused Incombank losses of $5.4 million.
The Vietnamese bank claims the trades were done by an unauthorised employee and ABN AMRO should not have executed them, although the Dutch bank has said the trades were valid.
Vietnam's Foreign Ministry played down reports of other overseas companies being scared off by the lawsuit, pledging that the dispute would be resolved without impacting foreign investment.
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