HA NOI – 2021 THUONGMAI UNIVERSITY BANKING AND FINANCE DEPARTMENT PRESENTATIONS TERM INTERNATIONAL PAYMENT EXPORT IMPORT FINANCING Topic The state of export financing activities and solutions to enh.
THUONGMAI UNIVERSITY BANKING AND FINANCE DEPARTMENT - - PRESENTATIONS TERM: INTERNATIONAL PAYMENT & EXPORTIMPORT FINANCING Topic: The state of export financing activities and solutions to enhance the efficiency of Vietinbank Export Financing activities TEACHER : MS PHAM THU TRANG GROUP : CLASS : 21721BKSC2412 INDEX CHAPTER I: THEORETICAL BASIC HA NOI – 2021 1.1 The concept of export financing 1.2 Type of export financing 1.2.1 Bank financing 1.2.2 Buyer credit 1.3 Conditions and process of export financing 1.3.1 Principles and conditions for export credit financing 1.3.2 Lenders and export credit process 1.4 Interest rates and credit fees 1.5 Role 1.6 Factors affecting export financing activities CHAPTER II SITUATION OF EXPORT FINANCING ACTIVITIES OF VIETINBANK 2.1 General introduction about Vietinbank .6 2.2 Business Performance 2.3 Current status of Vietinbank's export financing activities 11 2.3.1 Forms of export financing of Vietinbank 11 2.3.1.1 Pre – shipment financing .11 2.3.1.2 Post – shipment financing 11 2.3.2 Export credit financing process 13 2.3.3 Current status of Vietinbank's export financing credit activities 14 2.3.3.1 Export loan 15 2.3.3.2 Collecting 17 2.4 Results of export financing activities .17 2.5 Limitations of export financing activities 18 CHAPTER III: SOME SOLUTIONS TO IMPROVE THE EFFICIENCY OF EXPORT SPONSOR ACTIVITIES AT VIETINBANK 19 3.1 General development orientation .19 3.2 Orientation to improve the efficiency of import and export financing activities at Vietinbank 20 ASSOCIATION OF INDIVIDUAL TASKS GROUP Full Name 31 Dang Thi Diem Position Member Assigned work Product results Point evaluation 32 33 34 35 36 37 38 39 Quynh Ho Diem Quynh Nong Duc Tien Nguyen Thu Trang Pham Hien Trang Tran Thuy Trang Nguyen Quoc Trung Vu The Van Ngo Thao Vi Member Member Member Secretary Member Leader Menber Member CHAPTER I: THEORETICAL BASIC 1.1 The concept of export financing Export financing is a cash flow solution for exporters Export Finance facilitates the commerce of goods internationally Export financing allows the businesses that sell products to another country to get access to working capital before their clients pay for the products purchased 1.2 Type of export financing 1.2.1 Bank financing 1.2.1.1 Pre-shipment financing (Export Working Capital Financing) “Pre-shipment financing” means financing the temporary working capital needs for the fulfillment of an export transaction 1.2.1.2 Post shipment financing - Negotiation (Or Purchase) of Bills of Exchange: Negotiation in trade finance means the purchase of bills of exchange and/or shipping documents “with recourse” by a bank from an exporter Negotiation also refers to “discounting bills of exchange (documentary drafts) and/or documents” - Export factoring (international factoring) means trade finance where a factor purchases the exporter’s receivables without recourse (or with recourse) to the exporter and performs the credit control of the sales or debt collection functions - International Forfaiting: Forfaiting means the purchase of future receivables on a “without recourse” basis “Forfaiting” can be also defined as a purchasing (or discounting) negotiable financial instrument such as a bill of exchange “without recourse 1.2.2 Buyer credit Advanced payment: In case the documents are not eligible for discount, and there are withdrawers who not agree to the discount, the exporter can request the bank to advance the payment of ordinary goods at the rate of about 50% -60% export value The bank collects the debt by sending documents abroad to repay the debt, within 60 days from the date of sending the money documents without receiving the "Yes" notice from the foreign bank, the bank will automatically debit to the deposit account If the customer's account has insufficient balance, the bank will transfer the delinquent extraction or pre-application within working days When paying from a foreign bank, the loan will be deducted directly along with other related costs 1.3 Conditions and process of export financing 1.3.1 Principles and conditions for export credit financing Principles of lending - Loan capital must be repaid both principal and interest according to the committed time - Loan capital must be used for the right purpose as committed when borrowing capital - Loan capital must be secured by the value of mortgaged property, pledge or goods and materials Lending condition Depending on the laws of each country, the lending conditions of each commercial bank have different specific regulations Normally, in order to get a loan from commercial banks to perform import-export contracts, a loan enterprise must satisfy the following basic conditions: Having full legal status, legal capacity and capacity for civil acts, production and business activities in accordance with current laws of the host country Having enough own capital according to the prescribed level, borrowed capital from credit institutions only to supplement the necessary business capital level Production and business must be profitable, with no overdue debts Must have collateral, pledge, or guarantee There must be a plan to use the loan capital, if possible, for the purpose, efficiency, feasibility and ability to repay the loan, and the source of loan repayment Comply with and enforce all regulations in the credit regulations of the State bank and the credit institutions that are in relationship Credit guarantee for export financing The mortgaged or pledged property must: - Belongs to legal ownership of the mortgagor, mortgagor, guarantor and is allowed to transfer - Not being tied to mortgages, pledges or guarantees at other credit institutions - There is no dispute, or is sealed or blocked, is in the process of dissolution or bankruptcy of the enterprise, is not bound to any other commitment obligations - Easy to buy and sell on the market, ensuring loan recovery - The set of payment documents must be valid for payment and allowed for transactions - For mortgaged property that is movable property such as house, land, it must not be located in the clearing, regulation or local area - For collateral greater than the loan amount Depending on the type of collateral, there is an appropriate valuation method 1.3.2 Lenders and export credit process - Foreign currency loans - Local currency loans (banks lend local currency to meet capital needs in export business, collection of export goods, or production of export goods ) Export credit process Depending on the policy and business model of each bank, the financing process and the organizations and individuals involved in the export credit process have different points But in general, an import-export credit process usually includes the following basic steps: Step 1: Receive loan application When an import-export business needs a bank loan, the enterprise must send the following documents to the bank: - Legal records - Economic profile - Loans profile Step 2: Verify your profile - Check the legitimacy of legal documents Assess the business, financial and company situation of the enterprise Assess the feasibility of the business plan Assess the reputation and development ability of customers Appraisal of mortgaged, pledged and guaranteed properties Step 3: Credit officer makes a report Step 4: Disbursement Step 5: Check during loan disbursement Step 6: Check after lending Step 7: Collect debt, calculate interest and collect interest Step 8: Liquidation of the contract 1.4 Interest rates and credit fees Credit interest rate is the percentage between interest and loan amount in a certain period (month/year) Factors that affect credit interest rates: - The group of factors that shift the supply curve of loanable funds: + Average income of economic entities + Expected return and expected inflation: + Risk of losing capital + Liquidity - Group of factors that shift the demand curve for loanable funds: + Expected return of investment opportunities + Expected inflation Real interest rate = Nominal interest rate – Inflation rate • Government debt • Fixed interest rate • Floating interest rate (variable, volatile) Cost of Capital + Fixed Rate Margin or include: Fixed Cost of Capital + Variable Rate Margin • Mixed interest rates • Credit rate fee: is the monthly/yearly percentage between the total cost of the loan and the actual amount of the loan used When borrowing, the borrower must calculate the credit rate fee, because it reflects the actual the cost that the borrower has to pay to borrow money The actual total loan amount includes the total nominal loan amount minus the procedure fees, immediate fees paid to the Bank, the loan security deposit The credit fee is always greater than the interest rate, the narrower this spread, the lower the actual price of the credit Credit interest rate is calculated according to the formula: PTD = CP/TV x 100% PTD: is the credit rate fee CP: is the actual total cost, including interest and other fees related to the loan TV: is the actual loan amount that the customer can use this indicator is determined by the difference between the amount of credit as committed and the amount that the bank retains and collects immediately 1.5 Role The role of credit for the Bank's export activities is reflected in the following aspects: - Bank credit contributes to improving business efficiency of enterprises in the market Effective business is a requirement of economic accounting and is also one of the conditions for providing credit of banks Therefore, bank credit promotes businesses to pay more attention to business efficiency and increase profits Besides, the flexibility in terms of time and interest rates of bank credit will encourage the initiative and creativity of businesses in using capital to suit their capital needs in each period different period Bank credit helps to promote export activities faster - Derived from the high risk in the export business and due to the lack of mutual understanding between the buyer and the seller, the bank's presence will not pay when the bank guarantees to provide credit to the customer Importers and vice versa, thanks to the credit source of the importer's bank, can carry out important imports while their financial capacity is not yet met - The bank is a focal point to receive funding from foreign countries for export activities Because at present, most of the funding of international financial - monetary institutions for a certain country is done through the banks of the host country The role of bank credit for export activities is even more meaningful when the bank implements the State's policies, including export-oriented policies banks will provide exporters with large credit lines at favorable interest rates so that they can solve the problem of shortages in their business 1.6 Factors affecting export financing activities These are factors beyond the control of the country, which directly or indirectly affect the export activities of enterprises The following factors can be mentioned - The economic growth of the export market: It influences the demand and solvency of export clients, therefore influencing firm export operations Gross domestic product (GDP), population income, inflation, and interest rates are indicators of the export market's economic progress - Political condition, international cooperation: It expresses itself in the trend of country cooperation This would result in the development of economic and political blocs of a group of nations, impacting companies' export market condition - Characteristics and socio-cultural changes of the export market: Having a great influence on the needs of customers, thereby affecting the purchasing decisions of customers and affecting export activities enterprise's exports - The level of scientific and technological development of the export market: It will affect many aspects of the socio-economic life of that market, thus affecting the demand and purchasing power of customers - Trade policies of countries with export markets for company - Influence of the world socio-economic situation: Any change in export policies, inflation, unemployment or economic recession growth of other countries will affect the export activities of exporting enterprises CHAPTER II SITUATION OF EXPORT FINANCING ACTIVITIES OF VIETINBANK 2.1 General introduction about Vietinbank Vietinbank (Vietnam Joint Stock Commercial Bank for Industry and Trade) is a stateowned Vietnamese bank The Bank was established to carry out banking transactions including mobilizing and receiving short-term, medium-term and long-term deposits from organizations and individuals, short-term, medium-term and long-term loans to organizations and individuals on the basis of the nature and capacity of the Bank's capital; performing foreign currency transactions, international trade finance services, discounting commercial papers, bonds and other valuable papers, and other banking services permitted by the State Bank of Vietnam Vietinbank has experienced more than 30 years of establishment and development: Phase I: 1988 – 2000: Established and transformed from a one-tier into a two-tier bank, officially put Vietnam JSC Bank for Industry and Trade into operation Phase II: 2001 – 2008: Successfully implemented the organizational restructuring project, targeting debts handling, organization model, general policies & mechanisms and business operations Phase III (from 2009 to 2013): Successfully implemented equitization, strongly innovated, and developed breakthroughs in banking activities Phase IV (from 2014 to present): Focus on building and implementing strategic governance, making breakthroughs in technology, continuing to comprehensively innovate banking operations, promoting business growth associated with with guarantee of efficiency, safety and sustainability VietinBank is the leading commercial bank today, providing a wide range of modern banking and financial products and services of international standards This is also the first Vietnamese commercial bank to open a branch in Europe GOVERNANCE MODEL AND STRUCTURE: 2.2 Business Performance Despite going through a difficult year due to the impact of the Covid-19 epidemic, Vietinbank's business activities in 2020 still achieved positive results Vietinbank's total assets as of 31/12/2020 reached more than VND 1,340 trillion, a yearon-year (yoy) increase of 8.1% and well achieved the target set by the General Meeting of Shareholders (GMS) Credit balance reached nearly VND 1,300 trillion, up 7.8% yoy, meeting the target set at 2020 annual GMS Right from the beginning of 2020, Vietinbank actively implemented saving solutions including cost reduction and quality management of growth creating favorable conditions for growing credit, lowering lending interest rates as well as promptly removed difficulties for enterprises to enable enterprises and individuals conveniently access credits and banking products with the lowest cost Funding growth was in line with demand for capital, the structure of funding varied by currency, and the proportion of demand deposits continued to increase Fund mobilized from enterprises and individuals reached nearly VND 990 trillion, an increase of over VND 97 trillion (up 10.9%) In which, demand deposits from customers increased by 27.8% The ratio of current accounts’ balance increased from 17.0% in 2019 to 19.6% in 2020 Customer deposits grew stably and sustainably over the years Non-Performing Loan (NPLs) was 0.9%, meeting the target set by the GMS; NPL coverage ratio reached 132%, much higher than that in 2019 Credit quality was tightly controlled, meeting legal regulations and safety limits requirements by the State Bank of Vietnam (the SBV) In 2020, Vietinbank bought back all special bonds valued at VND 13,000 billion sold to Vietnam Asset Management Company (VAMC) within less than years, hence optimizing the balance sheet structure, improving financial quality, founding a solid foundation for the Bank’s business in the coming years Business efficiency was highly improved Separated Profit before tax (PBT) in 2020 was VND 16,449 billion, an increase of 44%, completing 163% of the target set out by the GMS Consolidated PBT reached VND 17,085 billion, an increase of 45%, completing 164% of the plan set by the GMS Overall, despite being affected by the Covid 19 epidemic, Vietinbank still achieved outstanding results in 2020: - Affirming and strongly promoting the role as the pillar bank of the economy, the pioneering bank in implementing policies of the Government and the SBV, and contributing significantly to the country’s socio-economic development - Implementing effectively the Restructuring Plan in association with handling bad debts in the period of 2016 – 2020 at Vietinbank and the MID-TERM BUSINESS PLAN for the period 2018-2020 - Building up Vietinbank’s development strategy for the period 2021 - 2030 with the vision to 2045, the MID-TERM BUSINESS PLAN for the period of 2021 – 2023 - Promoting the “customer-centricity” strategy, strengthening the transformation of competition approaches by focusing on developing modern and comprehensive banking and financial solutions for customers as well as providing products and services to undersupply chains - Making constant efforts to improve the bank’s capability towards best standards and common practices in bank governance, improving business efficiency associated with enhanced quality of growth and effective risk management - Enhancing the thorough combination of organizational structure model and network arrangement, personnel placement, strengthening solutions to improve the quality of human resources, ensuring the rights of the employees; timely implementing policies to protect resources, and ensuring effective operation in the complicated context of the COVID-19 pandemic - Being the pioneering and outstanding bank in the investment and development of modern and synchronous banking technology, extensive application of IT in business development and governance - Practicing efficient financial management, effective allocation of financial resources, increasing labor productivity - Being honored with noble awards by local and international prestigious organizations, which enhanced the image and brand name of Vietinbank both locally and internationally Continuing to make encouraging contributions and being a pioneer in various social security activities, effectively implementing policies and guidelines of the Party and Government 2.3 Current status of Vietinbank's export financing activities 2.3.1 Forms of export financing of Vietinbank VietinBank provides Corporate customers with capital financing to buy inputs material for their production and business activities 2.3.1.1 Pre – shipment financing VietinBank finance capitals for Exporting Corporates to buy inputs material for their production and business activities Product Benefits: - Capital financing for production and business activities once trading contracts are secured under the various payment methods such as L/C, D/P, T/T, - Time saving on receivables management and transferring the tasks of receivable collection to Bank experts, that allows customers to focus on their production and business 2.3.1.2 Post – shipment financing Export bill discouting 10 VietinBank makes advances for Exporting Corporates, and send documentations to Issuing/Collecting bank The discounting is based on the principles of reserving rights to collect from the Exporting Corporates Product benefits: - Working capital financing for traditional methods such as: L/C, collection, TTR; improvement on cash flow; ensure of the working capital, increase of the liquidity of the documentation bills - Enhanced competitiveness through grant of credit to importers with the acceptance of delayed payment - Receivable collection transferred to the Bank experts, which allows Customers to focus on production and business activities Export financing under Trade Card sale terms Trade Card is a program provided by Trade Card organization to participants engaging in import and export process (especially for textiles), including: Exporters, Importers, Transporting Companies and Banks Vietinbank makes advances for usance receivables (generally within 90 days), based on the export transactions made on the Trade Card system, starting from the time: - When a Transporting Company confirms the delivery on Trade Card system - When the importer authorizes the payment on Trade Card system Product benefits: - Corporates can sell on deferred payment terms but still be financed to ensure the availability of capital for production and business activities - Time saving on receivables management and transferring the tasks of receivable collection to Bank experts, that allows Customers to focus on their production and business Supply chain financing Vietinbank finances the supply chain, for both Seller and Buyer based on the commitment payments from the Buyer With this product, customers will be provided the following services: 11 Short-term working capital financing for Seller given the payment acceptance by the Buyer and receivables are transferred to Vietinbank Financing for payment obligations for Buyer upon maturity Management of Receivables, Payables, which reduces costs for both the Buyer and the Seller Product benefits - For buyers: Meeting needs of buying with deferred payment; Being financed in case of inability to pay upon maturity; Save cost in managing and tracking the payables This product is particularly suitable for buyers with a large number of suppliers - For sellers: Being financed with working capital; Reduced collection time for receivables; Eliminated or reduced non-payment risk from importers 2.3.2 Export credit financing process Access to guide customers on credit conditions and loan documents - For customers having a credit relationship for the first time: Credit officers guide customers to register information about customers, loan conditions and advise on setting up loan documents - For customers who already have a credit relationship: Credit officers preliminarily check loan conditions, loan documents, guide customers to complete loan documents - Customers who meet or not meet the requirements for loan documents are reported to the leadership by the credit officer and notified back to the customer (if they are not eligible for a loan) - Credit officers act as the focal point to receive dossiers, check the completeness, legality and validity Check the loan documents and purposes - Check legal documents 12 Credit officers check the legality and validity of documents in the list of legal documents - Check loan documents and loan guarantee documents + Credit officers check the authenticity of loan documents + For project business results reports for the next three years and production and business plans/investment projects, loan repayment capacity, repayment sources + In addition, check the suitability of the business lines recorded in the business registration with the borrower's current business lines and with the proposed investment plan and future industries - Check the loan purpose + Check that the loan purpose of the investment plan is consistent with the business registration + Check the legitimacy of the loan purpose (compare the loan request with the list of prohibited goods and commercial services according to the Government's regulations) + For loans in foreign currencies, check the loan purpose to ensure compliance with current foreign exchange management regulations Documents required to complete step 1: + Loan application + Documents proving the legal capacity of the client: business registration certificate, business establishment registration certificate, seal, tax code, decision on appointment of director, etc + Loan explanation documents: financial capacity documents such as financial statements, security documents, certificates of collateral, etc + Production and business plan, debt repayment plan, contingency plan, At Vietinbank, staff will receive and check customer's loan documents, consult and negotiate loan conditions with customers 2.3.3 Current status of Vietinbank's export financing credit activities 13 2.3.3.1 Export loan Targets 2019 Loan number 3.350 95.440 69.000 1.730 Loan sales Collecting original debt Earn profit Outstanding balance at the end of the 2020 5.894 183.500 152.500 2.920 2021 5784 219.540 185 240 3.520 period 55.160 79.240 103.240 Average outstanding balance 29.000 53.200 61.000 Rate of overdue debt (%) 0,74 0,6 0,55 The situation of export credit loans in 2019 and the first quarter of 2021 (million VND) Through the above table, it shows that loan sales in 2019 reached VND 95,440 million, principal collection was VND 69,000 million, interest collection reached VND 1,730 million, ending balance was VND 55,160 million, overdue debt ratio was 0.74 % of outstanding loans, average outstanding balance of 29,000 million VND, exceeding 16% of the plan assigned by the Prime Minister In 2020, the average loan balance target assigned is VND 40,000 million In 2020, Vietinbank's performance results were VND 183,500 million in loan sales, VND 79,240 million at the end of the period and an average loan balance of VND 53,200 million, exceeding the target by 33% The rate of overdue debt decreased, accounting for only 0.6% of outstanding loans As a result, loan sales increased by 92.23%, the number of loans increased by 2544 items, the amount of interest earned from export credit loans increased by 68.8% compared to 2019 The reason for such rapid growth is that in the year In 2019, the regulated interest rate for export credit loans is more than 10%/year, but the government subsidizes 4%, so the actual interest rate that import-export businesses have to bear is only 6.9% The state's export promotion policy in the context of the world economy showing signs of recovery has sharply increased the demand for bank loans for export business According to Decision No 3280/QD-BTC announcing the interest rates for investment credit loans, the State's export credits and the difference in interest rates calculated for postinvestment support, investment credit lending rates and State export credit in VND is 9.6%/year, in freely convertible foreign currency is 6.0%/year This interest rate is applied to projects signing contracts for the first time since January 01, 2020 With the increase of 14 interest rates from 6.9% to 9.6% for export credit loans denominated in VND This decision strongly affects export credit lending at banks in general and Vietinbank in particular But on the other hand, the USD exchange rate was raised, which caused mixed effects on VietinBank's export credit lending Specifically, in 2020, the number of loans decreased to 5784, but the indicators of loan sales, average outstanding balance and interest income all increased with a corresponding increase of 36,040 million VND (19.64%) VND 7,800 million (14.66%), VND 600 million (20.55%) contributed significantly to Vietinbank's impressive growth index in 2020 of 170% * Sales of export credit loans by product: Items 2019 2020 2021 Total 95.440 183.500 219.540 Rice 13.160 18.890 21.500 Sea food 69.000 55.600 72.800 Textile 0 Knitting 0 Cashew 4.510 9.520 10.800 Coffee 14.920 36.800 49.540 Shipbuilding 2.140 3540 2.780 Wooden 4.630 7.600 10.550 Vegetables 4.470 5.500 6.720 Other items 13.970 38.590 44.850 Sales of export credit loans by product in 2019-2021 (million VND) It can be seen that loan sales for traditional products still account for a high proportion According to the new regulations, in addition to items to be reduced (rice, knitwear, garment, footwear, etc.), the items are expanded in the direction of increasing processed and industrial products Among the reduced items, there are knitwear, textiles, leather and footwear which are the lending strengths of many localities in the past (Thai Binh with textiles and garments; the Southwest provinces with the rice products; Dong Nai, Binh Duong with leather and footwear products ) In the period of 2019-2021, the proportion of traditional loans still accounts for a high proportion of loan sales, of which seafood and coffee are the two items that account for the highest proportion 2.3.3.2 Collecting 15 Target/year 2019 2020 2021 Release 105.689.215 USD 120.007.868 USD 130.569.700 USD Pay 70.245.859 USD 98.246.846 USD 120.140.600 USD Surplus 13.307.478 USD 35.068.500 USD 45.497.600 USD The situation of revenue collection targets in 2019-2021 With a total annual issuance of more than 100 million USD, Vietinbank is one of the leading banks in export credit activities with an annual growth rate of more than 8% In 2019, issue 105,689,215 USD, in 2020 issue 120.007,868 USD, increase to 13.55% By 2021, it is 130,569,700 USD, up 8.8% compared to 2020 2.4 Results of export financing activities As can be seen, the bank's export finance has achieved some positive results, meeting a large part of the capital needs of Vietnamese export enterprises Detail: About customer relations: Currently, Vietinbank has been a sponsor of many corporations with strong export strengths in the area, such as Chau Phong rice exporters, Dong Tien seafood importers About professional activities: Export operations have been implemented in the area of the bank, and in some enterprises with strong export potential, this activity has been well implemented and this is a good nucleus to promote business activities promote good performance in the banking system Currently, VietinBank provides short-term loans and at the same time provides collection services to meet the temporary working capital of export enterprises The proportion of export loans reached an average of 63.3%, of which the highest year was in 2019 accounting for 70% In the past two years, this proportion has decreased but is not large (62% in 2020 and 58% in 2021) and the absolute outstanding balance still increases in the context that export activities face many difficulties due to the world economy being affected crisis by COVID –19 2.5 Limitations of export financing activities - Capital sources for import and export have not met the requirements: Currently, the demand for loans of export enterprises is increasing while the bank does not have a large and stable capital source to meet this demand market with high interest 16 rate and short term In addition, with capital mobilized from economic organizations, medium and long-term capital is also low, payment deposits are not high, making it difficult to implement medium and long-term funding projects of great value - Loan procedures at VietinBank are still complicated, causing difficulties for many businesses: The loan review period is long and the loan is mainly for each item, so it has not met the urgency of the loan to serve the deals to take advantage of business opportunities Limit loan consideration is very limited Previously, Vietinbank stipulated that before signing a credit contract, it was necessary to sign a Tripartite Agreement between Vietinbank - the borrower - the paying bank Minutes of agreement on the payment bank commits to notify Vietinbank when foreign customers make payment to the loan unit so that the bank can collect debts in a timely manner The above regulation causes many difficulties for the borrower, the borrower who has a good relationship with the paying bank can sign the minutes of agreement, other units have difficulties when signing the agreement tripartite agreement - Quality of appraisal is still low: When the loan appraisal based on financial statements to assess the financial position of the enterprise for a certain period of time (at the end of the accounting year) is not enough, and accurate, only the Information on a number of indicators did not change much, such as revenue targets, budget payment, fixed assets, profits while other financial indicators such as capital turnover, cash flow, receivables, payables, inventories, short-term debts cannot be updated timely and accurately from time to time To overcome these limitations, enterprises are required to make quick reports on the financial position but not fully show the financial position and operation process of enterprises Appraisal of loan applications, credit officers largely rely on information and financial reports provided by customers, leading to misleading assessments and inaccurate financing decisions The organization and collection of information on markets and businesses in Vietinbank's system are not really effective, because the portal has not been built 17 completely and comprehensively Therefore, it greatly affects the appraisal and approval of banks' loans and has many potential risks - The inspection and supervision of the use of loans is not strict : The monitoring and supervision of loans, comparison of data, documents, and disbursement vouchers have not been strict, and the monitoring of loan use has not been carried out regularly and fully At the same time, the process of making and presenting documents is not controlled, as well as the time of payment from abroad to the exporters account, so it is not possible to understand the loan flow, leading to the failure to collect debts in time and some exporters use the capital for the wrong purpose CHAPTER III: SOME SOLUTIONS TO IMPROVE THE EFFICIENCY OF EXPORT SPONSOR ACTIVITIES AT VIETINBANK 3.1 General development orientation ViettinBank will offercompetitive preferential interest rates for businesses, with rates ranging from 1% to 4% cheaper than standard loan rates Not only does VietinBank push for preferential interest rates, but it also advocates for open methods and circumstances to attract new potential clients, making it easier for import and export businesses to obtain bank loans Businesses are also exempted/reduced costs and prices of cross-selling items like as payment fees, insurance premiums, e-banking when they use VietinBank's programs As a result, the procedure has made a significant contribution to the expansion of financial capacity, production, and business for import and export businesses Furthermore, VietinBank creates credit products for each specialized industry, such as: traditional craft village loans, unsecured loans based on cash flow management from export contracts; export factoring, seafood and agricultural chains to provide financial support to export businesses with quick procedures, the collateral being the goods in circulation or the business's receivables 3.2 Orientation to improve the efficiency of import and export financing activities at Vietinbank 18 Enhance the branch's competitiveness in international trade financing in order to provide a safe, efficient, sustainable, and contemporary company in international integration Sustain and develop market share, maintain in the sector of international trade financing in Vietnam Maintaining the current customer network, focusing on major firms and economic groupings with a long history in international commerce, and reaching out to new clients with specialized focus and tactics for every level Diversifying and standardizing international trade finance products for each client, encouraging cross-selling of banking products and services in conjunction with insurance for import and export goods, international trade finance Continue to enhance the technologies used to increase the level of automation in transaction processing and risk management Improve the level of staff using import and export finance services, focus on and develop the network of old customers who are corporations, large corporations, traditional import and export enterprises 19