BCEL joins Thai firm to form securities company
Banque pour Le Commerce Exterieur Laos (BCEL), one of the largest state-owned banks in Laos, has joined a Thai firm to create a securities company.
The bank's Managing Director General, Mr Sonexay Sitphaxay, signed the joint venture agreement with KT Zmico CEO, Mr Chaipatr Sivisarvacha, to establish the BCEL Krungthai Securities Company Ltd at a ceremony held at Don Chan Palace Hotel in Vientiane on Tuesday.
According to the joint venture agreement, BCEL will hold a 70 percent shareholding in the company and the rest will belong to the Thai partner.
The Vientiane-based BCEL Krungthai Security Company will provide underwriting services and financial consultation for companies that want to sell stocks on the Lao Securities Exchange (LSX), which is scheduled to open on October 10.
The joint venture will also act as brokers for companies and individuals, who want to sell and buy stocks on the stock market.
In recent months, Kolao and its Korean partner, as well as the Lao Development Bank and its Vietnamese partner, have also signed agreements to establish securities companies to provide services for companies and individuals who want to trade on the LSX.
Speaking at the signing ceremony, Mr Sonexay said that the establishment of the securities company would help boost the development of the LSX.
He said the stock market would play an important role in the development of the Lao economy as it would help companies to raise capital funds for expansion. The market will also encourage Lao companies to operate more transparently, encouraging more foreign investors to come to Laos.
The Lao government plans to open the LSX in October, giving opportunities for state and private enterprises to raise funds to expand business. The government believes that increasing investment will provide more jobs and income for Lao people.
Construction of the LSX building was 60 percent complete last month. Two state-owned companies, BCEL and Electricite du Laos, have stated they will list part of their companies on the exchange early next year.
The Lao Brewery Company has also expressed an interest in listing on the exchange, but has not confirmed when it will do so.
The government has given the green light for all state-owned enterprises to list on the exchange but many need to improve their operations to meet stock market regulations before they can do so.
By Ekaphone Phouthonesy
(Latest Update September 02, 2010)
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