Securities firms' Q4 profits plummet on market downturn

MB Securities JSC, Agribank Securities Corporation, and Viet Capital Securities JSC reported sharp profit declines year-on-year in the fourth quarter of last year.

MB Securities JSC (MBS) reported a pre-tax profit of VND105.6 billion ($4.5 million) in Q4/2022, down 51% year-on-year. The firm's profit from proprietary trading reached nearly VND26 billion ($1.11 million), down 37.6%.

MSB posted an operating revenue of VND405.9 billion ($17.32 million) in the period, down 38.4% year-on-year. Of this, securities brokerage revenue saw a sharp decrease of 55.5% to VND135.6 billion ($5.78 million).

Revenue from financial consulting activities dropped by 90% to only VND3.7 billion ($158,000), while the figure in the same period last year exceeded VND37 billion.

In 2022, the broker's operating revenue and pre-tax profit reached VND1,958 billion ($83.53 million) and VND660.6 billion ($28.18 million), down 11.7% and 10.3% year-on-year, respectively.

The company had set a total revenue target in 2022 of VND3,027 billion, and a pre-tax profit plan of VND1,100 billion.

Meanwhile, Agribank Securities Corporation (Agriseco) recorded a pre-tax profit of VND55 billion ($2.35 million) in Q4, down nearly 39% year-on-year.

Its Q4 operating revenue was VND95 billion ($4.05 million), down 23%. The company's securities brokerage revenue dropped sharply by 60% to VND14.1 billion ($601,500). Interest from loans and receivables decreased by 9% to VND37.7 billion ($1.61 million).

Its profit from proprietary trading hit VND14 billion ($597,000), doubling the same period last year.

In 2022, the company gained operating revenue and pre-tax profit of VND367 billion ($15.65 million) and VND180 billion ($7.67 million), down 6.8% and 58% year-on-year, respectively.

Another brokerage house, Viet Capital Securities JSC's (VCSC) pre-tax profit in Q4 plunged by 94.5% to VND32.4 billion ($1.38 million), far behind the same period last year of nearly VND584 billion ($24.91 million).

Its operating revenue reached VND796 billion ($33.96 million) in the quarter, down 29.7% year-on-year. The company's securities brokerage activities decreased by 2% to VND209.7 billion ($8.95 milliion). Notably, VCSC's financial income decreased by 97% to VND6.7 billion ($285,800).

VCSC lost more than VND31 billion ($1.32 million) from proprietary trading - the main reason for the dismal results in Q4.

In 2022, the company's operating revenue and pre-tax profit reached VND3,156 billion ($134.63 million) and VND1,059 billion ($45.18 million), down 14.9% and 42.7% year-on-year, respectively.

VCSC fullfilled 97% of its revenue target and 56% of its profit plans.

According to the company, in Q4, the stock market was strongly affected by incidents related to Van Thinh Phat and Saigon Commercial Bank (SCB), leading to panic among investors. Investors fled from corporate bonds and sold off stocks, causing the VN-Index at the end of the year to drop 32.78% compared to the increase of 35.73% in 2021.

Although many stocks gradually recovered toward the end of the year, they still lost 60-70% of the market price compared to their peak. The sharp decline since the middle of the year turned Vietnam's stock market into the world's strongest falling market.