HCMC stock exchange to test South Korean system
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Vietnam’s overloaded main bourse, the Ho Chi Minh Stock Exchange, next week will begin testing a new system from South Korea which it plans to use later this year.
The system would have the capability to handle “many times more” transactions than now, Le Hai Tra, CEO of the exchange, said.
A temporary system from FPT, which has been tested in recent months to deal with the overload, would serve as a backup, he added.
HoSE signed a deal for the system in 2012 with the Korea Exchange at a cost of VND600 billion ($26.16 million).
But since last year South Korean experts could not come to Vietnam due to the Covid-19 pandemic, and so installation was delayed.
A record number of new investors in recent times has placed an extreme strain on HoSE’s outdated system.
The bourse increased the trading lot from 10 shares to 100 and instructed brokerages to stop order changes and cancelations to reduce the number of transactions.
Questions & Answers
Q.What is the primary benefit expected from the new South Korean system?
What is the primary benefit expected from the new South Korean system?
The new system is expected to significantly increase the transaction handling capacity of the Ho Chi Minh Stock Exchange. It would be capable of processing many times more transactions than the current system, addressing the ongoing overload issues.
Q.Why was the installation of the new system delayed?
Why was the installation of the new system delayed?
Installation of the new system was delayed because South Korean experts were unable to travel to Vietnam due to the Covid-19 pandemic. This prevented them from being on-site to complete the setup process.
Q.What interim measures has HoSE taken to manage its system overload?
What interim measures has HoSE taken to manage its system overload?
HoSE increased the trading lot from 10 shares to 100 and instructed brokerages to cease order changes and cancellations. These actions were implemented to reduce the total number of transactions processed by the outdated system.
Q.When was the deal for the new system originally signed?
When was the deal for the new system originally signed?
The agreement for the new system was signed in 2012 between the Ho Chi Minh Stock Exchange and the Korea Exchange. The cost of this deal was VND600 billion, equivalent to $26.16 million.
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