Credit risk management at military commercial bank dong anh branch

ĐẠI HỌC QUỐC GIA HÀ NỘI TRƯỜNG QUẢN TRỊ VÀ KINH DOANH - NGUYỄN MAI LAN CREDIT RISK MANAGEMENT AT MILITARY COMMERCIAL BANK - DONG ANH BRANCH QUẢN LÝ RỦI RO TÍN DỤNG TẠI NGÂN HÀNG THƯƠNG MẠI CỔ PHẦN QUÂN ĐỘI - CHI NHÁNH ĐÔNG ANH LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH HÀ NỘI - 2022 ĐẠI HỌC QUỐC GIA HÀ NỘI TRƯỜNG QUẢN TRỊ VÀ KINH DOANH - NGUYỄN MAI LAN CREDIT RISK MANAGEMENT AT MILITARY COMMERCIAL BANK - DONG ANH BRANCH QUẢN LÝ RỦI RO TÍN DỤNG TẠI NGÂN HÀNG THƯƠNG MẠI CỔ PHẦN QUÂN ĐỘI-CHI NHÁNH ĐÔNG ANH Chuyên ngành: Quản trị kinh doanh Mã số: 8340101.01 LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH NGƯỜI HƯỚNG DẪN KHOA HỌC: TS VŨ THỊ PHƯƠNG LIÊN HÀ NỘI - 2022 DECLARATION I declare that the thesis has been composed by myself and that the work has not be submitted for any other degree or professional qualification The data and results stated in the thesis are honest and have clear origins ACKNOWLEDGMENT I sincerely thank Vietnam National University, Hanoi for providing me with the financial means to complete this project And finally, thanks to parents, and numerous friends who endured this long process with me, always offering support and love This project would not have been possible without the support of many people Many thanks to my adviser, Dr Vu Thi Phuong Lien who read my numerous revisions and helped make some sense of the confusion Also thanks to my committee members, who offered guidance and support TABLE OF CONTENTS DECLARATION .1 LIST OF TABLE i LIST OF FIGURES, DIAGRAM ii INTRODUCTION CHAPTER 1: THEORETICAL BASIS OF CREDIT RISK MANAGEMENT IN COMMERCIAL BANKS .8 1.1 Overview of Credit activities at Joint Stock Commercial Bank 1.1.1 Concept 1.1.2 Features of bank credit 1.1.3 The role of commercial bank credit 1.2 Risks credit risk of commercial banks .10 1.2.1 Credit risk concept 10 1.2.2 Credit risk classification 11 1.2.3 Features of credit risk 12 1.3 Credit risk management in commercial banks 13 1.3.1 Credit risk management concept 13 1.3.2 Objectives of credit risk management 13 1.3.3 Principles in risk management .14 1.3.4 Requirements for credit risk management 15 1.3.5 Contents of credit risk management .16 Credit risk measurement 19 Credit risk prevention and response 22 Credit risk control 26 1.4 Factors affecting credit risk management 27 1.4.1 Objective factors 27 1.4.2 Subjective factors 28 1.5 Quantitative research process 32 1.5.1 Sampling method 32 1.5.1.1 Sample size 32 1.5.1.2 Conduct investigations 33 1.5.2 Information processing methods 33 1.5.2.1 Check the reliability of the scale using Cronbach's Alpha reliability coefficient 33 1.5.2.2 Model fit analysis 33 1.5.2.3 Multiple regression analysis 34 1.6 International experience on credit risk management of commercial banks and lessons for Vietnamese commercial banks 34 1.6.1 Credit risk management at Bangkok Bank of Thailand .34 1.6.2 Credit risk management at Citibank of America 35 1.6.3 Credit risk management at ANZ Bank in Australia .36 1.6.4 Credit risk management at Vietcombank – Vinh Phuc Branch 38 1.6.5 Credit risk lessons for Military Commercial Joint Stock Bank - Dong Anh branch 40 CHAPTER 2: CURRENT STATUS OF CREDIT RISK MANAGEMENT AT MILITARY COMMERCIAL BANK - DONG ANH BRANCH 42 2.1 Overview of Military Commercial Joint Stock Bank - Dong Anh branch .42 2.1.1 General introduction about Military Commercial Joint Stock Bank - Dong Anh branch 42 2.1.2 Organizational structure .44 2.1.3 Business results 45 2.2 Actual situation of credit risk management activities of Military Commercial Joint Stock Bank - Dong Anh branch 54 2.2.1 Credit granting process at MB .54 2.2.2 Situation of credit risk at MBbank - Dong Anh branch 56 2.3 Current status of credit risk management at Military Commercial Bank - Dong Anh branch 58 2.3.1 Credit risk identification .58 2.3.2 Measuring credit risk 59 2.3 Credit risk prevention and response 69 2.5 Credit risk control 71 2.6 Survey of MBbank staff's opinions on factors affecting credit risk management at branches 75 2.6.1 Correlation analysis 78 2.6.2 Regression analysis 80 2.6.3 Check the fit of the model 81 2.6.4 Testing of regression coefficients Regression 81 2.4 General assessment of credit risk at Military Commercial Joint Stock Bank Dong Anh branch .84 2.4.1 Achievements .84 2.4.2 Limitations 86 2.4.3 Cause 88 CHAPTER 3: COMPLETING CREDIT RISK MANAGEMENT ACTIVITIES AT MILITARY COMMERCIAL JOINT STOCK BANK - DONG ANH BRANCH 92 3.1 Development orientation of credit activities at MBbank - Dong Anh branch 92 3.1.1 Developing credit activities in width and depth 92 3.1.2 Building and managing a loan portfolio from time to time 93 3.1.3 Establish a risk limit in credit activities Credit 93 3.1.4 Use of secured credit .93 3.1.5 Collecting information and credit records Credit 93 3.1.6 Improving the technique of recovering problematic debts 94 3.1.7 Improving qualifications and ethical qualities of credit officers Credit .94 3.2 Solutions to improve the effectiveness of credit risk management at Military Commercial Joint Stock Bank - Dong Anh branch 95 3.2.1 Solution group on credit risk identification .95 3.2.2 Solution group on credit risk measurement 96 3.2.3 Group of solutions to prevent and respond to credit risks 97 3.2.4 Group of solutions to spread risks 103 3.2.5 Group of solutions to limit and compensate for losses when risks occur 105 3.2.6 Group of solutions to improve the quality of human resources 106 3.2.7 Solutions group for credit risk control .107 3.2.8 Group of other solutions .109 3.3 Some recommendations 109 3.3.1 Recommendations to the Government .110 3.3.2 Recommendations to the State Bank 111 3.3.3 Recommendations to Military Commercial Joint Stock Bank 112 CONCLUSION 113 REFERENCES 115 APPENDIX .1 LIST OF TABLE Table 2.1 Business performance from 2018 – 2020 .46 Table 2.2 Some indicators of capital mobilization activities at MBBank - Dong Anh branch .49 Table 2.3 Credit performance indicators at MBBank- Dong Anh branch 52 Table 2.4 Overdue debt situation of MBbank - Dong Anh branch 56 Table 2.5 Bad debts of MBBank Dong Anh in the period of 2018-2020 57 Table 2.6 Bad debts of MBBank Dong Anh in the period of 2018-2020 57 Table 2.7 Indicators for scoring and ranking internal customers of MBBank .62 Table 2.8 MBBank's customer rankings .66 Table 2.9 Customer ratings of MBbank Dong Anh .68 Table 2.10 Diversifying credit Military Commercial Joint Stock Bank - Dong Anh branch 69 Table 2.11 Results of the branch's risk provisioning 70 Table 2.12 Provision ratio against bad debts 71 Table 2.13 Classification of MB's debts to businesses 73 Table 2.14 Research sample characteristics 77 Table 2.15 Correlation between independent and dependent variables .79 Table 2.16 Linear regression results .80 Table 2.17 Analysis of ANOVA 81 Table 2.18 Order of influence of factors 83 Table 2.19 Presentation of regression results .84 i LIST OF FIGURES, DIAGRAM Figure 2.1 Organizational structure of MMBank DongAnh branch 44 Diagram 2.1 Capital mobilization structure at MBBank over the years 47 Diagram 2.2 Outstanding balance over time MBBank Dong Anh over the years .53 Diagram 2.3 Graph of outstanding loans by economic sector 54 Diagram 2.4 The credit granting process at MB 55 Figure 2.2 Research model of factors affecting credit risk management at MBBank 76 ii INTRODUCTION Research rationale Operations of commercial banks are always risky Manifestations of these risks are very diverse and complex in terms of their causes, impact scale and impact nature In which, although considered as an individual risk, credit risk is still the most important risk and can cause serious losses for commercial banks The reason is that, since its inception, credit activities are still one of the main business activities, and income from credit is the main source of income for commercial banks Credit risk management has become a serious requirement and plays a decisive role in the stability and development of not only a commercial bank but also the system of credit institutions, the financial market and the entire economy This has been demonstrated very clearly in the actual operation of the banking industry and the Vietnamese economy in recent years When, for a long time, commercial banks pursued rapid development, increased in scale and market share, and sought large profits without realizing or paying attention to calculating and handling potential risks This has led to a deterioration in credit quality, deterioration of the bank's own reputation and financial potential, disturbances in the money market, and a direct impact on socio-economic life According to international standards and practices, the risk management mechanism for Vietnam's banking system is gradually improving and is evaluated quite closely However, the most effective solution is to improve the risk management capacity of commercial banks Credit risk management has always become an urgent issue that is the top concern of any commercial banks Any bank including Military Commercial Joint Stock Bank (MBbank) Especially in this difficult business environment, it requires banks to make real efforts, the goal set by MBBank and the development orientation of "Becoming the No set out MBbank identified one of the key tasks of this innovation strategy of MBbank to promote the consolidation of credit quality, strictly control new loans, actively handle bad debts, in parallel with the consolidating the bank's organizational structure, improving service quality In order to well fulfill the daily target in recent years, MBbank has thoroughly mastered the - Besides, MBBank Dong Anh needs to research and participate in credit derivative contracts The common feature of these management tools, they keep the assets on the accounting books of the credit institutions that created that asset, and at the same time transfer a portion of this asset to other partners, thereby achieving goals such as originator banks have the means to transfer credit risk without having to sell assets away; While the sale of the asset weakens the relationship with the customer, a secured transfer preserves that relationship 3.2.5 Group of solutions to limit and compensate for losses when risks occur 3.2.5.1 Enhance the efficiency of problem debt handling Bad debt is something no one wants, but it always exists in any bank, so establishing a mechanism to deal with problematic debt is an objective requirement In order to minimize losses when risks occur, it is necessary to have a clear delineation of functions and duties of relevant departments as well as a strong enough apparatus to solve problems arising in the processing process The bad debt settlement team can advise MB Dong Anh's Board of Directors on how to handle problematic debts when there are reports of signs of risk from the operational departments, ensuring the correct debt handling method, suitable for different customers In dealing with problem debt, it is necessary to take the necessary steps of compliance and caution, not to heat lime specifically Clarifying business status, collateral, customer's attitude, analysis of business resilience, level of debt repayment, customer cooperation, ability to handle assets guaranteed Choose a treatment plan an exploitation plan or a liquidation plan Choosing the appropriate application plan for each customer and MBBank Dong Anh's ability, ensures high efficiency and reasonable costs 3.2.5.2 Strictly implement debt classification and provisioning Strictly implement debt classification, avoid business situation and results without complying with accuracy in debt classification and risk provisioning 105 Proactively classifying debts according to the nature and debt recovery ability of the loan, resolutely transferring overdue debts for cases of credit contract violations that pose risks and lowering debt grades, making deductions Provisions are made to cover losses when risks occur 3.2.6 Group of solutions to improve the quality of human resources The third strongest impact compared to other factors on credit risk management (β= 0.146) People are always the decisive factor, solutions and staff are always mentioned by all research topics Staff is the decisive factor in the risks of commercial banks, from developing appropriate business strategies, granting credit to the right subjects, managing loans well, advising and helping customers to minimize risks Therefore, it is necessary to standardize bank staff in all departments, especially for leaders and credit officers, and it is necessary to implement some of the following solutions Improving the recruitment stage This is an important stage, it is necessary to develop and publicize the basic criteria for selecting credit officers, not only in terms of banking expertise but also knowledge about social aspects, general knowledge, health, communication ability Organize the recruitment exam seriously and openly In order to limit moral hazard and improve the responsibility of credit officers, attach responsibility to the interests of credit officers, there should be a clear and timely reward and punishment system This avoids the situation that cadres a lot as well as cadres little, moreover, some officers "take risks" for personal purposes Therefore, it is recommended to strengthen the financial contract for each staff on the basis of credit quality and effectiveness, resolutely handle the related obstacles with violations Thereby helping private officials improve their professional qualifications, general knowledge, and legal knowledge to complete assigned tasks Each credit officer must always cultivate himself in terms of moral quality, if he has a high sense of job responsibility The higher the cadre, the more exemplary they must be in the implementation of the lending regulations; regulations on loan guarantee; regulations on debt classification, setting up and use of provisions to deal with credit risks in banking activities of the Exchange and other relevant documents In this way, 106 not only can the ethical qualities be maintained, but the sense of responsibility is also raised, the work is handled more effectively, and the mindset of dependence and anticipation creates positive changes in management For cadres with outstanding achievements, it is necessary to praise and reward both materially and spiritually commensurate with the results they bring, including early salary increase or promotion to a higher position ; for officials who commit violations, depending on the nature, the degree to which education may convince or subject to disciplinary action With that, not only the discipline in credit activities and the bank's reputation are increasingly enhanced, but the credit quality is certain and significantly improved More attention should be paid to training, self-training, improving qualifications and creating favorable conditions for staff to study and research Training can take many forms such as private training or hiring experts in training In addition, it is necessary to build and train a team of leading experts, especially experts in credit risk management, who have access to advanced risk management methods, so that they can implementation Having a reasonable reward policy for the right people in the right units by paying salaries and bonuses in accordance with the regime to avoid factionalism, creating good motivation for employees, so that officers can strive to complete their tasks , promote creativity in labor emulation, but must ensure that credit officers not ignore the risk factors because they follow the planned targets In addition, it is necessary to classify loan approval officers according to specific levels and standards The classification of cadres must be according to criteria such as professional qualifications, professional experience, ethical qualities, and other auxiliary professions in order to arrange jobs to suit their capacity and qualifications level of each officer 3.2.7 Solutions group for credit risk control In the management of lending activities of credit institutions, internal inspection is very important On the one hand, internal inspection helps to detect errors in the lending process to correct and overcome, thereby contributing to the prevention of all kinds of risks; on the other hand, through internal inspection, it also helps to detect 107 unreasonable points of lending mechanisms and policies to promptly supplement and amend Therefore, the law stipulates that credit institutions must establish an internal inspection system under the management apparatus to help the management board run smoothly, safely and legally all professional activities of the credit institution In order for MB Dong Anh's internal inspection to be practical and highly effective in detecting and handling violations, contributing to preventing and limiting risks, the following directions can be implemented: - Set up professional teams in MB Dong Anh's internal inspection room, and assign specialized tasks to groups according to each type of business of MB Dong Anh With the current conditions of MB Dong Anh, in the immediate future, it is possible to establish a team in the internal inspection room, specifically establishing a credit group, accounting team and other professional groups This method of organization has the advantage that the staff of each group have the conditions to improve their professional skills because they only have to focus on research on their assigned professional fields, thereby improving the quality of their assigned work - Inspection and control must be associated with error correction, after each inspection and self-inspection, there must be a specific correction plan, clearly specifying the time to correct, and a specific person who is responsible for correcting the error Any unit that has been inspected, discovered, and recommended for correction but fails to correct or correct it in a formal way, the relevant persons must be responsible before the Director, including handling disciplinary measures - In order to improve the efficiency of inspection activities, MB Dong Anh needs to select officers with professional knowledge and experience in practice Besides, it is necessary to have a reasonable remuneration regime, giving priority to the training regime - Loan inspection activities not stop at the post-audit work", but must be conducted for all stages of the lending process Right from the moment Dong Anh MB receives the application for appraisal and decision If it is deemed 108 necessary (depending on the complexity of the credit), the branch's internal inspection apparatus must begin to check and the internal inspection will be carried out continuously for the loan with loan The inspection of all stages in the lending process will help detect errors early so that they can be rectified in time, thereby effectively preventing risks that may arise 3.2.8 Group of other solutions Setting up a division to predict factors of socioeconomic environment, market affecting production and business activities such as inflation, politics, exchange rate Set up a property valuation team and perform tasks related to notarization procedures and registration of asset security transactions Valuation of collateral is a very important issue in the lending of banks In order to limit the situation that the credit officer sets the price for the customer's collateral, sometimes according to feelings or intentionally to increase the loan level Security assets should pay attention to the following points: - Check clearly the legitimacy of the collateral under the ownership of the borrower or the guarantor - For assets that are difficult to sell on the market, assets that are easily depreciated or depreciated, they are not accepted as security assets - For assets that are not required to have papers proving their ownership, the pledge method must be used - For properties that are required by law to buy insurance, the customer must present the insurance purchase contract during the loan guarantee period, and the Bank will be the first beneficiary of the insurance when a risk occurs - Collect information about collateral to avoid customers falsifying documents, making many loan documents at many different banks - Carry out strictly and effectively the periodic assessment of collateral assets, avoiding the situation of overvaluing the asset's value 3.3 Some recommendations In the research model of factors affecting credit risk management of MBBank - Dong Anh branch, external environmental factors that affect credit risk management = 109 0.115) This factor is largely governed by the management and administration of the Government and the state bank The following suggestions contribute to stabilizing the economy and business environment not only for MBBank but also for all commercial banks and other industries in general 3.3.1 Recommendations to the Government To completely deal with problems, bad debts, healthy financial situation, clean up the monetary balance sheets of commercial banks; reduce the factor of direct state intervention, make the financial system transparent according to international standards, thereby increasing the capacity of selfmonitoring and internal risk management Improving the legal environment for banking business Recently, the Government and the State bank of Vietnam have issued many documents, creating a legal environment for the operation of commercial banks Regulations on handling and sale of assets currently have guidelines, but the actual implementation is very limited Therefore, the state needs to specify the handling and sale of mortgaged, pledged and guaranteed properties as a basis for implementation Simplify unnecessary administrative and legal procedures during processing Because the handling of property sales involves many agencies and sectors, the State can issue specific documents regulating this The failure to comply with the statistical reporting regime is quite common nowadays, partly because the ordinance on the statistical accounting regime is not yet effective enough to compel businesses to comply and partly due to the conditions Statistical accounting in our country has not developed control activities and has not implemented the compulsory audit regime On the other hand, measures to handle economic and administrative violations are not strict Therefore, the State should immediately take tough measures, forcing businesses to strictly comply with the Ordinance on Accounting and Statistics, and implement the annual mandatory audit regime for all businesses The State's macromanagement policies and mechanisms are in the process of adjustment, renewal and improvement Domestic production and business must 110 compete fiercely with imported and smuggled goods Enterprises redirecting and adjusting their production and business plans cannot keep up with the changes of macroeconomic mechanisms and policies of the State Therefore, a number of enterprises and production and business industries face difficulties, stagnant inventories of goods and materials, loss of income, and insolvency, thereby arising overdue and bad debts (only for this reason) The tax rate schedule for imported goods has changed several times a year, causing many difficulties for many businesses Therefore, the State needs to take measures to ensure a stable economic environment for the operation of enterprises, including the activities of enterprises and the operation of the State bank stepping stone or practical solutions to remove difficulties caused when there is a transformation and adjustment of mechanisms and policies related to the entire operation of the economy Request the State bank to propose agencies and departments to support, cooperate and create conditions for Military Commercial Joint Stock Bank to confirm the status of enterprises with outstanding debts It is proposed that the Government soon issue a decision to allow Military Commercial Joint Stock Bank to continue to handle outstanding debts due to objective reasons that not have enough documents to wait for the completion of dissolution, bankruptcy or actual procedures The customer has been inactive for a long time but has not yet been issued a decision on dissolution or bankruptcy by the competent authority Directing the largest creditors of the enterprise to take the initiative to act as the focal point to organize the debt reassessment Coordinate and propose relevant state agencies courts, judgment enforcement, ministries, branches and local agencies to create conditions and support mechanisms for the implementation process | measures to handle outstanding debts for banks Strengthening the inspection, examination and control from the State bank to build a strong enough inspection system in both quantity and quality to ensure the most effective control of the banking system, all acts Violations of credit regulations and rules must be handled seriously 3.3.2 Recommendations to the State Bank 111 - Against unfair competition between banks, the State Bank needs to have effective inspection and control of all business activities of commercial banks, ensuring sustainable and safe development, in accordance with the law, avoiding maximum risk in credit activities - Applying the basic principles of effective banking supervision (25 principles of banking supervision of the Basel Committee) in performing the functions of a state management agency and supervising the market, completing methods of internal control and audit in credit institutions and towards international standards The banking supervision system has been improved in the direction of improving the quality of financial analysis and developing an early warning system for potential problems in business activities in general and credit granting in particular early for commercial banks, ensuring the market's sustainable development - Researching and implementing credit insurance tools such as credit swap These are tools of a highly developed financial market to help commercial banks to prevent and insure credit risk, share risks and create flexibility in loan portfolio management of each bank - Completing the credit information system of the State Bank of Vietnam CIC Center: To improve the efficiency and promote work motivation, it is possible to study and convert this Center into a joint stock company capital contribution of commercial banks Research and apply the model of an independent credit rating company in Vietnam to support banks in their business activities, which can attract technology transfer and learn from companies' experiences credit rating in the world 3.3.3 Recommendations to Military Commercial Joint Stock Bank Currently, with the change of customer information records, the head office and branches face many difficulties in communicating with each other The Military needs to review the management regulations and change customer information so that customers can go to any branch to change information, avoid causing trouble for customers and limit credit risks For corporate customers) It is necessary to develop an inspection process in the system to build a professional province of inspection, Military Commercial Bank should have a software 112 for inspection that applies the system To best serve the requirements of risk management, evaluate the quality of operations on the database of business software, the test results will be better Upgrading the asset management system to ensure the whole system is to better serve the valuation of collateral assets of credit officers as well as limit credit risks arising from secured assets Focus on and further accelerate the handling of direct debt collection, regularly review debts, classify and assess the recovery ability to implement debt recovery measures Conclusion On the basis of analyzing the situation and causes of credit risk management at Military Commercial Bank, the topic has proposed solutions to improve the effectiveness of risk management credit risk at Military Commercial Bank Dong Anh branch At the same time, the topic also makes a number of recommendations and proposals to all levels to support the business environment and effective credit risk management, and develop a stable and sustainable financial system CONCLUSION Being the first state-owned commercial bank to carry out organizational transformation following a partial operating model since 2008 in the context of economic difficulties shows that there is a divergence of Vietnamese commercial banks in line with the goals and in the economic mind set by the Party and Government In the past years, Military Commercial Joint Stock Bank has completed socio-economic goals and contributed significantly to the government's fight against inflation In the market economy in the direction of integration, the impact of objective economic laws will certainly have an impact on the business performance of Military Commercial Joint Stock Bank, in which credit activities - commercial activities mainly there will be many good opportunities but also can not avoid possible losses Credit risk is an objective fact, but banking is a sensitive activity that has a great impact on the socio-economic situation Therefore, the management and supervision of banking business activities, especially credit activities, is always a priority of all countries, state management agencies, state banks 113 Credit risk and measures to limit credit risk attract the attention of state agencies In Vietnam, the business environment is changing rapidly under the impact of comprehensive integration with the world economy To ensure operational safety and enhance competitiveness in the globalized environment, each bank should be encouraged to apply international standards in credit risk supervision and management On the basis of common standards, banks need to develop an appropriate credit policy, a practical and effective risk management process, an organizational structure and a closely monitored credit process tight The system of credit policies, credit risk management and credit processes not only detects and prevents risks but also regularly controls credit quality From approaching the basic theories of credit risk management of banks in the market economy compared with the practice of assessing credit risk management activities at Military Commercial Joint Stock Bank Dong Anh branch, the thesis has developed orientations and solutions to minimize risks in the banking business in general and in particular in the process of transforming credit management model, improving capacity Risk management ensures stable and sustainable growth of credit activities However, the topic still has limitations We hope to receive the comments of teachers and friends Hereby, I would like to express my sincere thanks to Dr Vu Thi Phuong Lien, who wholeheartedly guided me to complete this thesis 114 REFERENCES Nguyen Huu Khoi (2015) "Risk management at Military Commercial Joint Stock Bank - Da Nang branch" Duong Thi Anh Thu (2018) "Credit risk management at Military Commercial Joint Stock Bank - Quang Tri branch" Duong Thi Anh Thu (2018) "Credit risk management at Military Commercial Joint Stock Bank - Quang Tri branch" Tran Thi Thuy Dung (2020) "Credit risk management at Military Commercial Joint Stock Bank" Phan Thi Hoang Yen (2019) "The reality of Basel application in Vietnam" Vu Thi Phuong Thuy (2019) "Implementation of Basel II in Vietnam and some solutions" Sam N Basu (2006), with the study “Trategic credit management” Glen Bullivant (2010), with the study “Credit Management” Landy Wingard “The Top Challenges Banks Face With Risk Management” 10 Business ethics and operational risk management in Malaysian local conventional banks –Noor Fareen Abdul Rahim, Hazlinda Hassan, Universiti Utara Malaysia (2016) 11 Operational risk management towards Basel II standards at Vietnam Technological and Commercial Joint Stock Bank – Tran Thi Hang Nga, University of Economics, Vietnam National University, Hanoi (2016) 12 Nguyen Hoang Bich Tram, 2014 “Credit risk assessment for listed commercial banks in Vietnam”, No 14, Development and Integration Journal 13 Banking Science Research Institute, 2009 “Current situation of credit risk of Vietnamese commercial banks and limited prevention solutions Hanoi: Statistical Publishing House.[13] 14 Nguyen Thi Van Anh, 2014 “Limiting risks to the banking system through the 15 application of Basel II – view from international experience” Journal of Financial and 16 Monetary Market, Issue 20/2014, pp.36 – 39.[14] 115 17 Doctor Nguyen Minh Due (2007), Lecture on risk management, Hanoi University of Science and Technology 18 Law on credit institutions 19 Annual reports, processes, documents, regimes and policies issued by Military Commercial Joint Stock Bank 20 Financial statements, business performance reports for the period 2018 - 2020 of MBBank Dong Anh Branch 116 APPENDIX SURVEY QUESTIONS Dear Mr/Mrs, my name is Nguyen Mai Lan and I am currently a college student at Hanoi National University I am doing a research project "Factors affecting credit risk management at Military Commercial Joint Stock Bank - Dong Anh branch" We hope you take the time to fill out the SURVEY TABLE below Your answer is very important to my research If you want to refer to the research results, I will provide them to you at the completion of the thesis Sincere thanks! I - ABOUT YOUR INFORMATION Which of the following fields is your current job related to? □ Executive Management □ Credit business □ Loan Appraisal □ Internal inspection and control How many years of experience you have in the banking sector? □ Less than years □ From to years □ From to 10 years □ Over 10 years II - SURVEY CONTENT Please select of boxes corresponding to your survey level of how much you agree with the survey Very disagree Disagree Have no ideas Agree Very Agree Criteria Anwers Credit Policy Credit policies with specific orientations and strategies Diversified credit policies in terms of credit granting forms, industries and fields of lending Credit policies are reviewed and adjusted to suit the economic situation Credit policies are disseminated to each relevant branch, department, and credit officer Credit granting process The bank's credit granting process is clear and specific The credit granting process complies with the provisions of the law The process of granting credit in accordance with the capacity and qualifications of personnel The credit granting process has separation between relevant departments (customer relations department, appraisal department, support department, ) Credit Information Complete, objective, accurate and reliable credit information Quality Good credit information affects credit quality Does the bank have a credit information system? 5 Update and adjust indicators in line with international Credit Rating System The evaluation criteria are reasonable and complete standards The credit rating system evaluates the customer's ability to repay well and makes a reasonable lending decision Credit rating system is good for controlling loans Credit officers fully meet the requirements of capacity and Quality of personel professional qualifications Professional ethics of Credit Officers are always evaluated and closely monitored The bank has a good reward policy Credit officers regularly improve their skills and expertise 5 Supervision and management activities of the State Bank are External environmental factors The legal system is synchronous and complete effective The economy has many fluctuations Competition from banks is fierce Banks have measures to identify, measure and warn of credit Credit risk management at banks risks The Bank stipulates the allowable bad debt ratio 5 The bank ensures the balance between capital mobilization corresponding to the target of interest income from loans The bank has measures to handle and control bad debts and lending ... credit risk at MBbank - Dong Anh branch 56 2.3 Current status of credit risk management at Military Commercial Bank - Dong Anh branch 58 2.3.1 Credit risk identification ... management at Military Commercial Bank - Dong Anh branch Chapter 3: Solutions to improve credit risk management at Military Commercial Bank - Dong Anh branch CHAPTER 1: THEORETICAL BASIS OF CREDIT RISK. .. no research on credit risk management at MBbank, Dong Anh branch Therefore, the author chooses the topic "Credit risk management at Military Commercial Joint Stock Bank - Dong Anh branch" as the