SSI forecasts that in 2025, outstanding margin loans may continue to increase based on new solutions to support payments for foreign investors or domestic individual investors returning to the market.
SSI forecasts that in 2025, outstanding margin loans may continue to increase based on new solutions to support payments for foreign investors or domestic individual investors returning to the market.
2025 revenue limited but securities company profits may improve
Looking back at 2024, the securities industry group had outstanding growth results compared to the market in the first quarter of 2024, then the performance gradually decreased in the context of mobilization interest rates starting to increase due to pressure on exchange rates. In addition, foreign investors' net selling transactions were strong during the year, causing the securities group's performance to decrease by 0.8% in value in 2024.
Stocks that recorded positive price increases were companies that increased capital early in 2024, including MBS (51%), BVS (48.5%), FTS (33.4%), and HCM (29.2%) and conversely, stocks that decreased in price were companies facing many difficulties in corporate governance, including APG (-45.1%) and VND (-33.3%).
Regarding business results, operating revenue in the first 9 months of 2024 mainly came from margin lending activities (contributing 36% of revenue, thanks to margin lending balance increasing 33% over the same period) and revenue from proprietary trading activities (contributing 26%, mainly thanks to income from certificates of deposit/valuable papers).
Brokerage income is expected to decline quarter-on-quarter due to fee competition and lower overall market trading volumes in the second half of the year. Investment banking revenue is expected to remain low due to a lack of major IPOs and M&A deals in 2024.
Based on a conservative view, the general market assumption estimates a slight increase in transaction value (3%) with many difficulties in the first half of 2025 due to unpredictable external factors and the expectation that liquidity will recover from the second half of 2025 thanks to information about the upgrade and improved macroeconomic conditions, SSI Securities Company estimates that the revenue growth of securities companies will be somewhat limited in 2025 but profit growth may improve thanks to cutting operating costs.
Securities companies actively mobilize capital, margin lending will continue to increase
SSI believes that the estimated fee/commission income of the securities brokerage segment will be almost unchanged in 2025 in the context of a slight increase in transaction value, which can partly offset the downward trend in transaction fees due to fierce competition among securities companies. The significant capital increase in 2024 and the 2025 plan will continue to support margin lending revenue, although growth is unlikely to have a breakthrough in the context of volatile market conditions.
In addition, NIM may decline due to competition and rising interest rate environment. It is estimated that the investment banking segment will gradually recover thanks to some IPOs being implemented and the bond underwriting segment may increase when the corporate bond market recovers. For the proprietary trading segment, revenue from certificates of deposit/valuable papers is expected to maintain a large proportion.
With the increasing level of competition and the strong participation of securities companies under banks, securities companies have stepped up capital increase or bond issuance to prepare capital for business operations and implement payment support solutions (Non-Prefunding Solution) for foreign institutional customers.
SSI estimates the value of capital increases and bond issuances by large securities companies at VND77,800 billion for 2024 and 2025, equivalent to 55% of outstanding margin loans as of the third quarter of 2024, of which nearly VND37,000 billion has been completed.
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| Capital raising deals of major securities companies. Source: SSI Research |
In addition, the outstanding margin loan balance at the time of the third quarter of 2024 reached VND 224,000 billion. This is a record high in absolute terms, in relative terms, the outstanding margin loan accounts for 81% of equity and this ratio has remained relatively stable since 2023 and is much lower than the peak of 120% in 2021.
The increase in margin lending balance is not consistent with market liquidity, suggesting that the increase may not come from individual investor leverage, but from margin lending under agreements. SSI forecasts that in 2025, margin lending balance may continue to increase based on new solutions to support payments for foreign investors or domestic individual investors returning to the market.
Source: https://baodautu.vn/du-no-cho-vay-margin-chung-khoan-se-con-tang-trong-nam-2025-d240485.html
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