High volatility in the Thai stock market has resulted in uncertainty in brokerage income, Finansa's managing director Vorasit Pokachaiyapat said yesterday. As a consequence, reducing the company's degree of dependence on brokerage income will make its income more stable.

Finansa's current revenue sources include underwriting, advisory services, brokerage, fund management and overseas investment.

The company is negotiating with a number of investors to set up a new fund worth at least US$50 million (Bt1.78 billion) to invest in Vietnam, to take advantage of the country's investment boom, he said.

Negotiations are expected to be complete by the third quarter of this year, and the fund will concentrate on joint-venture investments in non-listed companies engaged in cement, exporting and construction businesses.

There are several investors interested in putting money into Vietnam's stock market because of continued solid growth in the country's economy, Vorasit said.

Over the past 10 years, Vietnam's gross domestic product (GDP) has risen by an average of 8 per cent per year. Its bourse now has a market capitalisation of $17 billion, compared with a mere $1 billion in 2005, and its daily turnover has jumped from $70,000 last year to $70 million at present.

Finansa began investing in Vietnam in 1991, but the investment was frozen in the aftermath of the Asian financial meltdown.

As well as Vietnam, Finansa plans to invest in China, prompted by strong growth in its economy over the past decade, Vorasit said.

In the third quarter of 2006 Finansa plunged to a net loss of Bt32.44 million, compared to a Bt38.09 million net profit in the corresponding period of 2005. It in the first nine months of last year, it posted a net loss of Bt217.54 million, compared to a net profit of Bt161.5 million in the first nine months of 2005.

Siriporn Chanjindamanee The Nation