Better year expected from banking fees

The company also expects to maintain its 5.47-per-cent share of the stock-trading market by value, CEO Kongkiat Opaswongkarn said yesterday.

He said Asia Plus was currently advising on up to five mergers and acquisitions expected to close this year. In addition, it is the financial adviser for up to three private placements and public offerings of shares.

However, its involvement in initial public offerings has declined, as fewer companies are listing on the bourse.

Kongkiat expects stock-market sentiment to rebound in the second half of the year, as investors will then start to seek more for funding sources for investments. Share prices have already reflected all the negative news.

"The average daily stock-trading volume is expected to be Bt14 billion this full year. Trading volume in the first quarter is considered to be the lowest [quarter this year]," he said.

Last year, Asia Plus posted a net profit of Bt210 million, down 52.63 per cent from the 2007, due mainly to gains in securities trading.

The CEO said the company's policy this year was to focus on income-based diversification, in accordance with market sentiment.

It targets the proportion of brokerage income at 50 per cent (down from 68 per cent in 2008), investment income at 20 per cent (up from 8 per cent), advisory income from investment banking at 10 per cent (up from 5 per cent), advisory income for private investments at 15 per cent (up from 10 per cent) and other income at 5 per cent (down from 9 per cent).

Kongkiat said Asia Plus expected its market share for stock trading to remain around last year's 5.47-per-cent level, although it had not set a formal target.

"The company has not set an official target for stock-trading market share this year, as it will not extend margin loans for speculated small stocks, in order to prevent losses," he said, adding that it had a policy to limit its exposure to margin loans to 30 per cent of its capital base.

The company plans to reduce its operating costs by closing some branches, reducing the number of non-efficient staff and cutting unnecessary expenditures.

"This is expected to enable the company to reduce costs by 2-3 per cent," said Kongkiat.

As to Asia Plus's investment portfolio, he said the company had diversified into stocks with an average dividend yield of 7-8 per cent per annum. These are mainly in the retail, food and information-technology sectors.

The company has increased its investments in property funds by focusing on those offering high dividend yields. It is also investing in more corporate bonds.