Brokerage houses adjust operations amid increasing competition
THE THAI brokerage industry is expected to see more fierce competition amid thinner trading turnover and new entrants, prompting brokerage houses to adjust themselves to cope with the higher competition, according to brokerage firms’ executives.
Paiboon Nalinthrangkurn, the chief executive officer of Tisco Securities, said that brokerage business would likely see higher competition due partly to thinner trading volumes. Daily trading turnover on the Thai bourse is expected to average Bt45 billion to Bt50 billion this year.
Last year’s daily figure was Bt56 billion.
He believes that this year, brokerage companies will compete more in services, while price competition still exists. But everyone must understand that the price competition does not lead to any gain. There is no profit, but only volume.
Tisco Securities banks on its research, he said, adding that no matter how efficient an application is, customers will not use the services if the investment recommendation is not helpful.
The company will focus on developing its application to make stock trading easier to use, with new services like management of investment portfolios for its customers with a minimum trading amount of Bt1 million.
Kongkiat Opaswongkarn, the chief executive officer of Asia Plus Group Holdings, said that brokerage houses faced competition in innovation and various products every year.
The company’s strength is the variety of its products with innovation and, thus, its income base comes from several sources ranging from commission fees, investment banking, wealth management to proprietary trading, he said.
He said that brokerage firms that focus on providing useful advice for investment would succeed in the long run.
Kampol Jantavibool, the chief executive officer at SCB Securities, said that to cope with higher competition, the company plans to sell fund units of five more asset management firms. Presently, it sells fund units for 13 fund management companies.
The company’s strength lies in the variety of its products with an emphasis on wealth management. It expects 50,000 new trading accounts of customers this year. Currently, it has 130,000 trading accounts, about 30 per cent of which are active.
Chaipatr Srivisarvacha, the chief executive officer at KT Zmico Securities, said the average commission fee has been lower than about 0.1 percentage points consistently for the past 5-6 years, while the company strengthens itself through both local and overseas products, good service quality and the development of marketing officers for good services.
This year, the company has joined forces with Krungthai Bank to enlarge its customer base, expecting 20,000 new trading accounts of customers this year. So far, it has 100,000 trading accounts.
Prachaya Kulvanichpisit, the chief executive officer of Phillip Securities (Thailand), believed that price competition will not become fiercer, while the variety of its products in the country and overseas and group network in 14-15 countries across the world continue to be its strength.
So far, the brokerage firm has about 90,000 trading accounts, of whom about 20 per cent of customers remain active.
This year, Phillip Securities (Thailand) plans to train its marketing staff for more knowledge in various products so that they can give proper investment advice to customers.
