Luận văn tốt nghiệp về đề tài: Nâng cao chất lượng cho vay doanh nghiệp vừa và nhỏ tại Ngân hàng TMCP Ngoại thương Việt Nam Vietcombank Chi nhánh Thành Công. Đề tài được viết bằng Tiếng Anh: Improving the Quality of Lending Activities to Small and Mediumsized Enterprises at Join Stock Commercial Bank for Foreign Trade of Vietnam Thanh Cong Branch và đạt 9.8 điểm.
TABLE OF CONTENTS STATUTORY DECLARATION ACKNOWLEDGEMENT LIST OF ABBREVIATION LIST OF TABLES LIST OF FIGURES INTRODUCTION .1 CHAPTER 1: THEORETICAL BACKGROUND OF LENDING ACTIVITIES AND THE QUALITY OF LENDING ACTIVITIES TO SMALL AND MEDIUM-SIZED ENTERPRISES IN COMMERCIAL BANKS 1.1 Overview of Small and Medium-sized Enterprises (SMEs) 1.1.1 Definition of Small and Medium-sized Enterprises (SMEs) 1.1.1.1 Definition of Enterprise 1.1.1.2 Definition and criteria for determining Small and medium sized enterprises .4 1.1.2 Characteristics of Small and Medium-sized Enterprises 1.1.3 Roles of SMEs towards the economy 1.2 Theoretical Background of Lending Activities to SMEs in Commercial Banks 10 1.2.1 Overview of Lending Activities to SMEs 10 1.2.2 Characteristics of Lending Activities to SMEs 11 1.2.3 Roles of Lending Activities to SMEs 12 1.2.3.1 Towards the Overall Economy .12 1.2.3.2 Towards the Commercial Banks .12 1.2.3.3 Towards the Customers (SMEs) .12 1.3 The Quality of Lending Activities to SMEs 13 1.3.1 Concept and Viewpoint Regarding the Quality of Lending Activities to SMEs 13 1.3.2 Criteria Evaluating the Quality of Lending Activities to SMEs .14 1.3.2.1 Credit Turnover 14 1.3.2.2 Loan Sales 15 1.3.2.3 Outstanding Loan 15 1.3.2.4 Loan Profit .16 1.3.2.5 Debt Collection 16 1.3.2.6 Overdue Debt and Non-Performing Loan 18 1.3.2.7 Growth rate of SMEs customer 19 1.3.3 Factors Affecting the Quality of Lending Activities to SMEs 19 1.3.3.1 From the Perspective of Commercial Banks 19 1.3.3.2 From the Perspective of Small and Medium-sized Enterprises 21 1.3.3.3 Economic and Social Factors 22 CHAPTER 2: SITUATION OF THE QUALITY OF LENDING ACTIVITIES TO SMALL AND MEDIUM-SIZED ENTERPRISES AT JOINT STOCK COMMERCIAL BANK FOR FOREIGN TRADE OF VIETNAM - THANH CONG BRANCH .24 2.1 Overview of the Joint Stock Commercial Bank for Foreign Trade of Vietnam and its Thanh Cong Branch 24 2.1.1 History of Establishment and Development 24 2.1.1.1 Joint Stock Commercial Bank for Foreign Trade of Vietnam 24 2.1.1.2 Joint Stock Commercial Bank for Foreign Trade of Vietnam - Thanh Cong Branch .26 2.1.2 Organizational Structure of Vietcombank - Thanh Cong Branch 28 2.1.2.1 Branch organizational chart 28 2.1.2.2 Functions of Departments in Vietcombank - Thanh Cong Branch 29 2.1.3 Main activities’ result of Vietcombank - Thanh Cong Branch in the period of 2020 - 2022 32 2.1.3.1 Profitability 32 2.1.3.2 Capital mobilization activities 33 2.1.3.3 Credit activities 36 2.1.3.4 Branch’s International Payment and Trade Finance .39 2.2 Situation of the Quality of Lending Activities to SMEs at the Joint Stock Commercial Bank for Foreign Trade of Vietnam - Thanh Cong Branch in the period of 2020-2022 .40 2.2.1 SMEs’ Lending Process at Vietcombank - Thanh Cong Branch .40 2.2.2 Evaluating the Quality of Lending Activities to SMEs at Vietcombank Thanh Cong Branch 43 2.2.2.1 Credit Turnover 43 2.2.2.2 Small and medium-sized enterprises Loan sales 44 2.2.2.3 Small and medium-sized enterprises Outstanding Loan 45 2.2.2.4 Small and medium-sized enterprises Loan Profit 47 2.2.2.5 Debt Collection 48 2.2.2.6 Overdue Debt and Non-Performing Loan 49 2.2.2.7 Number of small and medium-sized enterprises customers using loan services .52 2.3 General Assessment of the Quality of Lending Activities to SMEs at the Joint Stock Commercial Bank for Foreign Trade of Vietnam - Thanh Cong Branch 53 2.3.1 Achievements 53 2.3.2 Limitations and its Causes .54 2.3.2.1 Limitations of SMEs lending activities at the branch .54 2.3.2.2 Reasons for limitations 54 CHAPTER 3: SOLUTIONS AND RECOMMENDATIONS TO IMPROVE THE QUALITY OF LENDING ACTIVITIES TO SMALL AND MEDIUM-SIZED ENTERPRISES AT JOINT STOCK COMMERCIAL BANK FOR FOREIGN TRADE OF VIETNAM - THANH CONG BRANCH 58 3.1 Development Orientation of Lending Activities to SMEs at the Joint Stock Commercial Bank for Foreign Trade of Vietnam - Thanh Cong Branch in the short-term period (2023 - 2025) 58 3.2 Solutions to Improve the Quality of Lending Activities to SMEs at the Joint Stock Commercial Bank for Foreign Trade of Vietnam - Thanh Cong Branch 58 3.2.1 Enhance the effectiveness of customer service 58 3.2.1.1 Enhancing the customer care and Increasing the retention of traditional customers 59 3.2.1.2 Attracting more SMEs customers 59 3.2.2 Improve loan conditions regarding receiving collateral 60 3.2.3 Controlling the quality of lending activities to SMEs 61 3.3 Recommendations to Improve the Quality of Lending Activities to SMEs at the Joint Stock Commercial Bank for Foreign Trade of Vietnam - Thanh Cong Branch 63 3.3.1 Recommendations to the State Bank of Vietnam 63 3.3.2 Recommendations to the Joint Stock Commercial Bank for Foreign Trade of Vietnam 64 CONCLUSION 66 REFERENCES 67 LIST OF ABBREVIATION Abbreviations CIC COVID-19 FDI GDP KPI SBV SMEs USD VCB VND Full version Credit Information Center Coronavirus disease 2019 Direct Foreign Investment Gross Domestic Product Key Performance Indicator The State Bank of Vietnam Small and medium-sized enterprises US Dollar Joint Stock Commercial Bank for Foreign Trade of Vietnam Vietnamese Dong LIST OF TABLES Table 1.1 Criteria for determining SMEs of some countries in the world Table 1.2 Criteria for determining SMEs in Vietnam Table 2.1 Structure of mobilized capital of Vietcombank - Thanh Cong Branch in 2020 - 2022 34 Table 2.2 Loan structure of Vietcombank - Thanh Cong Branch in 2020 - 2022 37 Table 2.3 SMEs’ Loan Stages at Vietcombank - Thanh Cong Branch .41 Table 2.4 SMEs Loan Sales at Vietcombank - Thanh Cong Branch in the period of 2020 - 2022 44 Table 2.5 SMEs Outstanding Loan Structure by Term at Vietcombank - Thanh Cong Branch in the period of 2020 - 2022 45 Table 2.6 SMEs Outstanding Loan at Vietcombank - Thanh Cong Branch in the period of 2020 - 2022 46 Table 2.7 SMEs Loan Profit at Vietcombank - Thanh Cong Branch in the period of 2020 - 2022 47 Table 2.8 SMEs Debt Collection at Vietcombank - Thanh Cong Branch in the period of 2020 - 2022 48 Table 2.9 SMEs Overdue Debt and Non-Performing Loan at Vietcombank - Thanh Cong Branch in the period of 2020 - 2022 49 LIST OF FIGURES Figure 2.1 Organizational structure of Vietcombank - Thanh Cong Branch .28 Figure 2.2 Profit’s result of Vietcombank - Thanh Cong Branch in 2020 - 2022 32 Figure 2.3 International Payment and Trade Finance Sales of Vietcombank - Thanh Cong Branch in 2020 - 2022 39 Figure 2.4 Credit Turnover of SMEs at Vietcombank - Thanh Cong Branch in 2020 2022 43 Figure 2.5 Number of SMEs using loan services at Vietcombank - Thanh Cong Branch in 2020 - 2022 52 INTRODUCTION Rationale of the research Small and Medium-sized Enterprises (SMEs) account for 96.7% of the total number of enterprises in Vietnam The growth in both the number, the scale of operations of the SMEs sector has a great impact, making an important contribution to the socio-economic development and the process of international integration of the country (Vu Long, 2022) Indeed, SMEs play an important role in creating jobs, raising wages for workers, and contributing to poverty alleviation However, in the context of the prolonged Covid-19 outbreak, which had a negative impact on the economy, SMEs faced many difficulties Therefore, it is necessary for commercial banks to help them access appropriate capital to continue their operations On the other hand, the SME sector is a potential and profitable market for lending and is considered as a major source of income for banks However, SMEs located in Hanoi still face many difficulties, such as: smallscale business, poor cash flow management; lack of transparency in business plans, lack of capital, limitations in technology, inadequate management skills and quality of human resources All of those challenges make it difficult to access credit In addition, lending activities to SMEs still have many potential risks, and the quality of loans still needs to be improved Therefore, improving the quality of loans for SMEs is an important issue that attracts the attention of most banks, and Vietcombank is no exception Vietcombank has developed many strategies to support loans for SMEs and also offers many outstanding incentives for them.However, the growth rate and scale of outstanding loans to SMEs are still limited In addition, although Vietcombank has achieved the highest ranking in terms of bad debt provision among commercial banks, it still has an increasing non-performing loan ratio for SMEs due to the current economic situation Therefore, I decided to choose topic “Improving the Quality of Lending Activities to Small and Medium-sized Enterprises at Join Stock Commercial Bank for Foreign Trade of Vietnam - Thanh Cong Branch” for my thesis in Bachelor of Finance in order to further develop solutions for SMEs lending activities - which are considered as the priority of commercial banks' development strategies in the current context Purpose of the research The purpose is to deeply analyze the current situation of the quality of lending activities towards SMEs at the Joint Stock Commercial Bank for Foreign Trade of Vietnam - Thanh Cong Branch, thereby proposing solutions and recommendations in order to enhance the quality of lending activities to SMEs at the branch In order to achieve the mentioned purpose, there are three main contents: ● First, researching the theoretical background of the quality of lending activities to SMEs at the branch ● Second, analyzing and evaluating the current situation of the quality of lending activities to SMEs at the branch to identify its achievements and limitations ● Last, recommending appropriate solutions to improve the quality of lending activities to SMEs at the branch Object and Scope of the research 3.1 Research Object The quality of lending activities to Small and Medium-sized Enterprises at Commercial bank 3.2 Scope of the research Space Scope: The research is conducted at Joint Stock Commercial Bank for Foreign Trade of Vietnam - Thanh Cong Branch Time Scope: Secondary data related to Joint Stock Commercial Bank for Foreign Trade of Vietnam in the period of 2020-2022 are used to analyze Content Scope: The current state of lending activities to Small and Mediumsized Enterprises at Joint Stock Commercial Bank for Foreign Trade of Vietnam Thanh Cong Branch is analyzed, thereby proposing appropriate solutions and recommendations for increasing the quality of lending activities to SMEs Research Methodology 4.1 Method of Data Collection Secondary sources: News, reference materials and articles published in specialized journals related to the topic; Financial statements and related documents provided by the Joint Stock Commercial Bank for Foreign Trade of Vietnam - Thanh Cong branch such as: business report, bank’s balance sheet, annual report, etc