Vietnam Stock Exchange to be located in Hanoi HCM City, considered a financial center of Vietnam, could lose its stock market in the future because the watchdog agency plans to merge the Hanoi and HCM City stock exchanges into one Vietnam Stock Exchange headquartered in Hanoi.    The Ministry of Finance late last week submitted to the government the plan on the establishment of the Vietnam Stock Exchange. The information has stirred debate. People were surprised that Hanoi would be chosen for the head office. Meanwhile, there are many reasons for policymakers to choose HCM City for the stock exchange. HCM City is a big economic center, and a commercial hub, where breakthroughs in economic policies originated. The city has many joint stock banks and other financial institutions. Twenty years ago, Le Van Chau, who was then Deputy Governor of the State Bank and was assigned the task of setting up a stock market in Vietnam, decided that HCM City must be the place for the first stock exchange in Vietnam. The HCM City Stock Exchange (HOSE) was officially established in 2000, three years later than initially scheduled, because of the 1997 Asian financial crisis. However, an underground stock market existed during that three years, where the shares of state-owned equitized enterprises were transferred. The Hanoi bourse – HNX - was set up five years after that. HNX focuses on developing the bond market and serves as a place where small companies list their shares. Securities analysts and investors cite figures about the trading volumes of HOSE, not HNX, and the VN Index, the indicator of HOSE, not HNX Index of the Hanoi bourse, when talking about the Vietnamese stock market. The HCM City bourse obviously has a larger operation scale, higher trading value and higher daily average trading value than the Hanoi bourse. The former is also considered the place where most valuable commodities are traded. In general, the companies with larger capitalization value prefer listing their shares at HOSE, while the stock market itself sets higher requirements on listing companies in terms of capital and business performance. A report shows that the capitalization value of the companies on HOSE accounted for the overwhelming proportion -- 88 percent -- of the total market’s capitalization value by the end of 2014, equal to 25.5 percent of Vietnam’s GDP. The report also showed that the average capitalization value of a company in 2014 was VND3.2 trillion, while the trading value was VND2.17 trillion per trading session, or 73 percent of the market’s liquidity. TBKTSG