IMPROVING HOME LOAN SERVICES FOR INDIVUAL CUSTOMERS OF AGRIBANK, HA TAY BRANCH

Professional bachelor degree in Finance-Banking-Insurance (Customer relationships management) WORK PLACEMENT REPORT COMPANY: VIETNAM BANK FOR AGRICULTURE AND RURAL DEVELOPMENT “IMPROVING HOME LOAN SERVICES FOR INDIVUAL CUSTOMERS OF AGRIBANK, HA TAY BRANCH” Names of student: NGUYEN Thi Nguyet University year: 2019 - 2021 Tutor at TMU: NGUYEN Minh Nhat Linh Tutor at USTV: Marie-Josée Cambreling Tutor at (Company): BUI Minh Ngoc Hanoi - 2022 TABLE OF CONTENTS TABLE OF CONTENTS i LIST OF TABLES .ii LIST OF FIGURES ii ACKNOWLEDGEMENT .iii INTRODUCTION iv PART 1: OVERVIEW OF AGRIBANK AND THE INTERNSHIP I Overview of Agribank II.Agribank – Ha Tay branch III Introduction of my internship: PART 2: INTERNSHIP IMPLEMENTATION AT COMPANY I The internship position, responsibilities and tasks .4 Department structure and internship position Business procedure and work placement responsibilities Daily tasks II.Some business cases .5 Case No1 – Failed Case No2 – Sucessed Case No3 – Failed III Service analysis Introducing the home loan package at Agribank - Ha Tay branch Analysis of the current situation of home loan packages at Agribank Ha Tay branch 10 Customer research .12 SWOT analysis 19 IV KPI and KPR .20 Key performance Indicator – KPI 20 Key performance results – KPR 20 Host firm assessment and recommendation 20 PART 3: INTERSHIP ASSESSMENT 23 The difficulties encountered 23 Internship gained 23 CONCLUSION 25 APPENDICES 26 LIST OF TABLES Table : Internship plan at Agribank – Ha Tay branch Table 2: Daily tasks at Agribank – Ha Tay branch .5 Table 3: Information about case No1 Table 4: Information about case No2 Table 5: Information about case No3 Table 6: Documents profile name 10 Table 7: Current status of bank lending services (million VND) .10 Table 8: Current status of home loan services for individual customers of the bank (million VND) 11 Table 9: Some indicators of home loans at banks agribank, vietinbank, techcombank (%)……… 18 Table 10: SWOT - home loan at Agribank Ha Tay branch 19 LIST OF FIGURES Chart 1: Internship Office of Agribank - Ha Tay Branch .4 Figure 1: Percentage of age of people in need of a home loan (%) 13 Figure 2: Percentage of monthly income of people who need a home loan (%) 13 Figure 3: Job percentage of homebuyers (%) .14 Figure 4: Percentage of age of people in need of a home loan (%) 14 Figure 6: Percentage of tenors desired by homebuyers (%) .15 Figure 7: Percentage of monthly payments desired by homebuyers (%) 16 Figure 8: Percentage of the desired criteria of homebuyers choose (%) 17 Figure 9: Percentage of preferential loans that customers want (%) 17 ACKNOWLEDGEMENT After nearly months of implementing the topic "Improving home loan services for individual customers of Agribank, Ha Tay branch", I would like to express my sincerest thanks to the units and individuals who have helped and encouraged First of all, I would like to thank De Toulon University and the International Training Institute of the ThuongMai University have created a vibrant learning environment, encouraging students to academic research Especially, during the process of implementing the graduation thesis, I would like to thank Dr Nguyen Minh Nhat Linh His companionship and guidance helped me get the best research results Moreover, in order to have practical experience and close reality assessment, I would like to thank the Board of Directors of Bank for Agriculture and Rural Development Ha Tay branch for creating maximum conditions and supporting children during research INTRODUCTION Credit activities are one of the main roles of a commercial bank and Credit is always the leading activity in business indicators and also the most profitable activity for the Bank Essential needs such as eating well, wearing warm clothes, people's needs are thought of as the comfort of houses, means of transportation, household appliances, studying or studying abroad, etc People care a lot As a result, they allowed themselves to spend more than their income, which led to a significant increase in the demand for loans from individual customers From these needs, a market for personal loans has been created at banks Grasping the trend of people's needs as well as increasing competitiveness with other banks, Agribank Ha Tay branch has been deploying a variety of personal credit products to meet the needs of customers individualized customer services, excelling in providing innovative solutions to maximize customer needs Along with the above reasons, during the internship, I was supported and exposed to many different professions, but with the credit operation taking place at Bank for Agriculture and Rural Development - Ha Tay branch, I chose Topic “Improving home loan services for individual customers of Agribank, Ha Tay branch” for this internship report PART 1: OVERVIEW OF AGRIBANK AND THE INTERNSHIP I Overview of Agribank  Name, slogan: Vietnam Bank for Agriculture and Rural Development - “Bringing prosperity to customers”  Location: No.2 Lang Ha Street, Thanh Cong Ward, Ba Dinh District, Hanoi  Legal status: Active (has tax registration certificate)  Geographical development: Agribank is a bank with a nationwide network of operations, especially in remote, border and island areas  Number of employees: About 40000 officers  Date of creation: 26/03/1988  Activity : - Range of products: Deposit, Loans, Cards, Payment and Remittances, Electronic banking, - As one of the state-owned commercial banks that plays a key role in the banking system, Agribank has always promoted its pioneering role in leading the system of credit institutions to seriously and effectively enforce policies national currency and the Party's and State's policies on currency and banking, especially credit policies for agricultural and rural development II Agribank – Ha Tay branch  Location: Lot CC-02, Mo Lao Urban Area, Mo Lao Ward, Ha Dong District, Hanoi  Number of employees:  Date of creation: 1996  Activity : As a large branch of Agribank, Agribank Ha Tay has always been one of the leading branches in efficiency as well as contributing to the overall development of the whole bank Agribank Ha Tay is effectively implementing 07 policy credit programs (Lending according to credit policies for agricultural and rural development; lending to households and individuals through the loan group/affiliated group); Loans according to supportive policies to reduce losses in agriculture; Loans for cattle and poultry; Loans for coffee replanting; Loans for fisheries development policies; Preferential credits for “Clean agriculture”) and 02 National Target Programs (Building New Rural Areas, Sustainable Poverty Reduction) In addition, the branch also provides many services for corporate customers such as guarantee, international payment, etc III Introduction of my internship:  The reason to choose the project: As one of the state-owned commercial banks that plays an important role in the implementation of state policies, especially in the field of rural development, Agribank always focuses on implementing individual lending activities and support credit for many policy beneficiaries In recent years, people's demand for home ownership has increased, leading to an increase in the demand for personal loans for home purchases Having the support from the bank will help people, especially those with limited financial resources, have the opportunity to own their own house Therefore, Agribank has long had strategies to focus on developing and increasing the supply of this potential service That is why the author has chosen the topic "Improving home loan services for individual customers of Agribank, Ha Tay branch" to evaluate the performance of the branch's home loan service, thereby making comments based on analysis as well as recommendations and solutions to help the branch's home loan activities expand and develop, both in scale and efficiency  Internship plan: Date From: March 2022 Task / Mission Task 1: Learning the Outcome Knowing about the To: 15th March 2022 home loan procedure at system and structure of Agribank – Ha Tay departments of AGB Branch Understand the home st loan process and procedures of Agribank From: 16 March 2022 Task 2: Perform – Ha Tay Branch Assisting bank staff To: 30th March 2022 assigned tasks atthe inhome loan work From: 31 March 2022 branch Task 3: Supporting bank Mastering the lending To: 15th April 2022 staff to dosome home process, procedures and loan cases conditions through th st practical work From: 16th April 2022 Task 4: Conducting a Collecting data on To: 28th April 2022 survey on homeloan needs, financial conditions, of customers for analysis From: May 2022 Task 5: Assessing and and evaluation Assessing the current To: 20th May 2022 recommending solutions situation and for home loanactivities recommending some rd solutions to improve the quality of home loans From: 21st May 2022 Task 6: Completing the To: 27st May 2022 essay Table : Internship plan at Agribank – Ha Tay branch PART 2: INTERNSHIP IMPLEMENTATION AT COMPANY I The internship position, responsibilities and tasks Department structure and internship position I am doing an internship in the production and personal customer rooms under the supervision of Mr Bui Minh Ngoc, my direct supervisor at the bank and holds the position of department head In the room where I interned, there were quite a few staff members who were headed by the boss departments, deputy heads and then employees like the diagram I have described below Board of Directors Customer Service Department Business Customers Department Individual Customers Department Operation Department Chart 1: Internship Office of Agribank - Ha Tay Branch Business procedure and work placement responsibilities During my internship, I was assigned to basic banking jobs Thanks to that, I have a better understanding of the position of a loan consultant At the same time, know the working process and get acquainted with the professional working environment of the bank The things I have to most often are:  Have a meeting with the department about the working plan for the week  Read the documents, ask the instructor necessary things about the internship  Support and help other colleagues documentary tasks such as photocopy documents, arrange records or record meeting reports  Support to answer questions from customers in person or via the phone  Meet customers with bank staffs to introduce products or make survey about customers' loan conditions Figure 2: Percentage of monthly income of people who need a home loan (%) The graph shows the income of people who want to borrow to buy a home Most people in need have an income of 21-35 million dong, 36-50 million dong, or less than 20 million dong Because the above income is difficult to buy a house in a short time, many people have a need to borrow to buy a house to live in or invest People with incomes over 50 million are often less inclined to borrow to buy a house because if they save for a period of 1-3 years, they can buy a house without any costs and interest rates Figure 3: Job percentage of homebuyers (%) Most people who borrow money to buy a home are investors for profit or office workers who buy houses to live in or invest because they have stable sources of income and are able to repay the loan in the future Students accounted for 18.2%, self-employed people accounted for 15.2% of loan demand to buy a house Figure 4: Percentage of age of people in need of a home loan (%) The value of the houses that are borrowed to buy is mainly valued at 1.6-3.5 billion, especially at the average value of about billion This is the right value for most middle-income people, starting to settle down at work, and it is reasonable to own a house with all the most basic amenities for life The apartments below 1.5 billion or over 3.6 billion are less likely to account for the third and fourth highest rates, these are houses for those with a modest income, or much higher than the average In addition, only a few people with big savings and finances are interested in apartments priced above billion, mainly good houses, or buy for investment Those surveyed mainly want to borrow a loan with a value of 40-70%, at most 51-60%, it can be seen that this is also the loan threshold that many banks disburse to customers after steps financial appraisal, this number is not too high, nor too low, suitable for both the needs of customers and the standards set by the bank Meanwhile, a quarter of the surveyed people Figure 5: Percentage of home value that homebuyers need to borrow (%) Those surveyed mainly want to borrow a loan with a value of 40-70%, at most 51-60%, it can be seen that this is also the loan threshold that many banks disburse to customers after steps financial appraisal, this number is not too high, nor too low, suitable for both the needs of customers and the standards set by the bank Meanwhile, a quarter of the surveyed people expressed the need to borrow only 40-50%, which is less than half the value of the house These people have stable finances and want to reduce their debt burdens Only a few want to borrow up to 70%, but this is a difficult number to achieve in reality Figure 6: Percentage of tenors desired by homebuyers (%) Most people want a loan with a term of 11-15 years Or 16-20 years Because a long-term loan will help ensure that the payment of that loan when the interest is paid monthly or annually will be divided into less affecting the borrower's economy With loans for investment and buying a house to live in, it will be very beneficial for borrowers There are also some options for less than 10 years due to the need or the ability to quickly repay the loan, and the interest rate of the short-term loan will also be lower Few people choose to borrow for a term of 21-25 years or more than 25 years because of the long term, or most people want to borrow short-term or mediumterm loans Figure 7: Percentage of monthly payments desired by homebuyers (%) The total number of survey samples is 33 In which, most people choose part of the principal that is deducated monthly during the loan period, the remaining principal is paid at maturity to pay the loan Along with that is to pay by increasing amounts Or pay monthly interest and pay it off at maturity For a few, choose to pay by the method of decreasing payment amount Figure 8: Percentage of the desired criteria of homebuyers choose (%) The two main reasons that borrowers pay attention to when deciding to borrow a loan are interest rate and loan term, these are two important criteria that help assess whether a loan is really suitable for the financial ability of the customer or not (the amount of interest to be paid and the repayment period), these are also the two most important criteria not only in home loans but also in many other financial loans Some people are also interested in the disbursement time (the time it takes to receive the bank loan as well as the processing procedures) and the maximum… (Many customers want to see the maximum loan to assess the level of financial support that they receive) Figure 9: Percentage of preferential loans that customers want (%) In addition to the main loan, many customers are also interested in other supporting products and services when making a loan, which are Loan insurance, International credit card, Education loan discount, Reduced health insurance premiums, Offer for personal loans and Reduced life insurance premiums Competitor analysis I chose Vietinbank and Techcombank as two competitors to compare some conditions and procedures for lending with Agribank because these are two strong competitors in this field Term of loan Loan limit Agribank 15 years Up to 85% of Vietinbank 25 years Up to 80% of Techcombank 25 years Up to 90 % of Interest rate Loan financial need 7% / year Short -term loans financial need 7.7% / year Loan application financial need 7.49% / year Processing time arrangement up to days processing time when applying for a time Medium and long – here is a quite long loan is only 3-4 term loans 10 days working days maximum Table 9: Some indicators of home loans at banks agribank, vietinbank, techcombank (%)  Loan term: Compared to Viettinbank and Techcombank, Agribank has a shorter term (15 years compared to 25 years), most homebuyers want to borrow for a long time to reduce debt repayment pressure, so this target is Agribank is somewhat inferior compared to the other banks in terms of attracting customers, but it helps the bank quickly recover capital  Loan limit: Agribank's loan limit is 85%, neither too high nor too low (if compared with the other banks), this is a reasonable number, both suitable for customers' needs and reasonable for customers operational strategy as well as risk management and capital of the bank  Interest rate: Agribank's interest rate is the lowest when compared to two banks Viettinbank and Techcombank, even one of the banks with the lowest home loan rate among banks in Vietnam, due to its oriented operation orientation to the support of people and households of Agribank This is also an advantage to help attract customers to buy houses of Agribank compared to other banks  Loan arrangement time: Techcombank has a faster loan arrangement time than the other two banks Agribank is more flexible when divided into types: short term and medium and long term And viettinbank has the longest loan arrangement time The fastest possible loan arrangement will attract customers to choose Techcombank's products SWOT analysis STRENGTHS WEAKNESSES - Simple procedure - Customers are large but many are in the - Large client file countryside, so their income is still limited - Professional staff - The application of science and technology - Compared with joint-stock is not high in home loan products, leading commercial banks, Ha Tay branch to a situation where customers take a long Agribank has a larger scale, abundant time, and the cost of appraisal activities is capital, and long-term business large experience customs and culture of the Vietnamese people - The trend of socio-economic integration and integration of the banking and financial industry in particular also creates opportunities for the expansion of home loans of the banking industry OPPORTUNITIES THREATS - Supported by the State - Other competitors have similar products - Customers are more proactive and - Although the number of customers has have more conditions in accessing increased, it is still modest compared to the loans potential of the branch - + The economic development speed - Dynamic young banks and better is increasing, the demand for home advertising policies loans is increasing day by day, creating many opportunitie Table 10: SWOT - home loan at Agribank Ha Tay branch IV KPI and KPR Key performance Indicator – KPI My goal is to talk to customers to advise and provide information about home loan packages at Agribank Ha Tay Besides, improving office skills such as photocopying documents, typing, handling documents, meeting with customers, Key performance results – KPR My goal is to meet clients but I only meet clients I talked with them, advised on Agribank's home loan service and learned from my experience to better next time I have learned about the loan process, the basic knowledge of the bank Understand the working environment, office skills, how to communicate with customers and how to build co-worker relationships Host firm assessment and recommendation Agribank is a large bank but they have not really focused on personal home loan service, which is the biggest weakness and I have a few suggestions to develop this service: a Improving customer satisfaction in home loan services for individual customers:  Agribank does not have its own strength in personal home loan services to compete with other banks Therefore, we need to focus on potential customers and clients who have borrowed from our bank  Agribank Ha Tay needs to improve product quality in the direction of: completing procedures, service provision process, ensuring transparent, simple but strict procedures create comfort for businesses Thanks to such improvement in quality, it will create conditions for customers to save time and costs during the home loan process At the same time, the bank also saves time and effort to appraise customers This is a flexible and convenient model that should be promoted by the branch not only in home loan activities, but also applied in many other activities  Finally, Agribank Ha Tay branch needs to continue to develop policies and strategies to improve the quality of home loans for individual customers in each period to evaluate the results as well as clearly see the goals and orientations long-term work to be done b Training and improving professional skills of personnel: People always play a key role in all banking activities, including underwriting Therefore, in order to improve the quality of home loans for individual customers at Agribank Ha Tay, it is extremely necessary to focus on personnel training  Training: - Promote internal training at the branch, organize for employees to participate in short and long-term training courses to supplement professional knowledge, update information and experience After each course, staff at the branch as well as the whole bank will be tested on their knowledge and skills, and give evaluation and feedback to improve the quality of the course - Besides professional skills, other soft skills, especially foreign languages, also need to be trained This is especially necessary if the branch aims to diversify its customers in the future, including foreign companies and enterprises - Arrange personnel positions reasonably, helping employees promote their strengths and strengths in their positions In addition, it is necessary to select officers with high ability, enthusiasm and prestige to take on the leadership roles of the department - Focus on recruitment to acquire new human resources with high capacity, potential for development, and strengthen training for new employees  Reasonable remuneration policy: - A reasonable remuneration policy on salary and bonus to encourage employees to constantly strive in the working process is very necessary To evaluate the capacity and efficiency of work, the branch will base on factors such as: the implementation of the performance target in each planning period, recording service attitude through feedback from customers, recording receive working attitude from multidimensional assessment of leaders and colleagues c Improve customer service During its operation, Agribank Ha Tay has built close relationships with many customers In order to continue to expand its customer base to increase sales, the branch needs to set up reasonable policies on customer service  Improve relationships with traditional customers: - Pay attention to care, build trust and strengthen relationships with customers through: Establishing preferential loan fees, supporting loan limits for loyal customers, prioritizing the implementation Quick loan procedure, avoid cumbersome - Regularly ask for customer reviews and suggestions about lending services at the branch From there, the branch will make reasonable adjustments and solutions - Organize customer conferences to build solid relationships, share about the operation situation, preferential policies, and benefits that the branch offers to individuals With loyal customers, branches can carry out individual promotions such as gift giving, etc  Attract potential customers: - Conduct a review, classify customers based on many different aspects in order to have the best policies, orientations and incentives for each customer segment - On the basis of the set strategy, the branch will promote and introduce suitable loan products or incentives for first-time customers to use the loan service => helping to attract more customers new Strengthen marketing and communication policies One of the key reasons why Agribank Ha Tay is limited in attracting customers is that communication and marketing have not been really focused, with only approaching customers mainly through relationships or certain channels Therefore, the need for a specific strategy on Widely marketing, bringing information about the services that the branch provides to many customers is extremely necessary  Market research strategy: - Agribank Ha Tay needs to study the attitudes and motivations of customers when choosing a bank for a home loan The fact that a customer chooses a bank means that that bank can ensure the requirements of credibility, procedures, reasonable loan fees, attached services, staff attitude, etc will determine the needs of customers in order to make the most appropriate policy PART 3: INTERSHIP ASSESSMENT The difficulties encountered The difficulties that I encountered during my internship were quite a lot because the study environment and the working environment are really very different And due to being heavily affected by the covid epidemic, that made it impossible for me to visit the branch regularly or interact with many customers The working environment at the bank is very refreshing, everyone is serious and professional In the first session, I was assigned to office tasks such as scanning, copying documents, classifying documents, but I didn't know how to it and was enthusiastically guided by everyone That was the first problem I encountered The second thing is how to communicate with the staff at the bank and communicate with customers Because I have never had contact or experience, I was quite confused I tried to listen to the instructions, take notes to avoid mistakes And I had a hard time doing a survey on the demand for home loan services I have a hard time asking questions and reaching out to people taking surveys But with the help of my instructors and internship instructors, I was able to complete it Internship gained  Knowledge gained: During my internship, I was trained in office skills, banking industry, especially knowledge about home loan service for individual customers of Agribank Ha Tay branch  Experience gained: I already know how to build relationships at work Learn how to work in a team, coordinate with colleagues to complete assigned tasks I know how to listen better, know how to share opinions and absorb ideas from others Besides, communication skills are improved when And understand the working process at the bank in general and the steps to make a home loan package for individual customers in particular  Skills achieved: After interning at the bank, I have been cultivating the necessary skills more carefully Skills such as communication, scanning, photocopying, arranging, teamwork, typing or making PowerPoint significantly improved And I was much more confident when talking to customers, introducing products as well as convincing them to use the bank's products This is what I feel most excited and impressed about when I practice at Agribank Ha Tay Career plan ● Short-term: My short-term plan is to improve my computer skills, office skills and understanding of home loan products for individual customers of Agribank Ha Tay This is very necessary because it will help me to improve myself more and when I have knowledge about the product, I can introduce and convince customers to use the product and from there propose some solutions to improve the product to be better And especially, I want to finish my thesis in the best way so that I can finish my university journey ● Medium-term: During the past internship, I have been able to adapt to the working environment and train myself in a more disciplined manner so that I can have a good premise after completing the study program to apply for the job as desired It is to become a banker ● Long-term: In the future, I still want to work in the right field of study, which is Banking - Finance - Insurance Because after studying the program of the ThuongMai University in association with the University of Toulon, I understand more clearly that I like and fit this industry Thank you for the guidance of the lecturers who helped me better understand and find my desired job After completing my thesis, I hope I can graduate on time and find a suitable position for me at the bank where I did my internship CONCLUSION Along with the development of the economy, home loan service has become more and more important in the operation of commercial banks Not only helping to improve the reputation and operational efficiency, the home loan business also contributes to income, helping the bank increase profits Recognizing the importance and great benefits that this service brings, Bank for Agriculture and Rural Development Ha Tay branch always focuses on developing and improving the operational efficiency of this service For the purpose of evaluating and developing solutions to improve the operational efficiency of Agribank - Ha Tay branch, the article has researched and given a systematic view on: - Basic issues of lending activities, quality evaluation criteria as well as analysis of factors affecting bank lending activities - The current status of the quality of lending activities, through the evaluation criteria of quantity and quality, thereby evaluating the achievements that branch gained in the last years In addition, the limitations in this branch's activities through surveys, competitors, strengths and weaknesses, to find out subjective causes, as a basis for the branch to improve its operations me - Provide some solutions and recommendations based on the limitations and causes that have been studied to help Agribank Ha Tay branch have a more intuitive view, support the development of guarantee strategies and policies, human resources, marketing, customer service, gradually improving the quality of home loans for individual customers APPENDICES Survey on demand for home loan service for individual customers at Agribank Ha Tay branch  Age? - From 18 to 26 years old - From 26 to 30 years old - From 31 to 40 years old - Over 40  Job? - Office - Bussiness - Freelance - Student  Monthly income ? - Under 20 million dong - From 21 to 35 million dong - From 36 to 50 million dong - Over 50 million dong  What is the value of the house you intend to buy? - Under 1,5 billion dong - From 1,6 to 2,5 billion dong - From 2,6 to 3,5 billion dong - From 3,6 to billion dong - Over billion dong  What percentage of home loan value you want? - From 40 to 50 percent - From 51 to 60 percent - From 61 to 70 percent - Over 70 percent  What is you desired loan term? - Under 10 years - From 11 to 15 years - From 16 to 20 years - From 21 to 25 years - Over 25 years  How you want the monthly payments? - Decreasing monthly payments - Incremental monthly payments - Pay monthly interest and pay the full balance at the maturity - Part of the principal is deducted monthly during the loan period, the remaining principal is paid at maturity  Of the criteria below, choose the one that is the most important to you when making a home loan - Flexible debt payment methods - Loan disbursement time - Maximum loan amount per house value (%)  What incentives would you like to get with your home loan? - Loan insurance - International credit card - Education loan discount - Reduced health insurance premiums (for yourself and your family) - Offer for personal loans - Reduced life insurance premiums ... SWOT - home loan at Agribank Ha Tay branch 19 LIST OF FIGURES Chart 1: Internship Office of Agribank - Ha Tay Branch .4 Figure 1: Percentage of age of people in need of a home loan (%)... Percentage of preferential loans that customers want (%) 17 ACKNOWLEDGEMENT After nearly months of implementing the topic "Improving home loan services for individual customers of Agribank, Ha Tay branch" ,... taking place at Bank for Agriculture and Rural Development - Ha Tay branch, I chose Topic ? ?Improving home loan services for individual customers of Agribank, Ha Tay branch? ?? for this internship