Completing the financial analysis of corporate customers in credit activities at vietnam international commercial joint stock bank ba dinh branch hao nam transaction office”

BANKING ACADEMY FACULTY OF FINANCE  - GRADUATION THESIS TOPIC: COMPLETING THE FINANCIAL ANALYSIS OF CORPORATE CUSTOMERS IN CREDIT ACTIVITIES AT VIETNAM INTERNATIONAL COMMERCIAL JOINT STOCK BANK - BA DINH BRANCH - HAO NAM TRANSACTION OFFICE Student : Nguyen Linh Trang Class : K20CLCD Course : 2017 – 2021 Student ID : 20A4011349 Instructor : Dr Nguyen Thi Dao Ha Noi, May 2021 Tai ngay!!! Ban co the xoa dong chu nay!!! 17014126042521000000 BANKING ACADEMY FACULTY OF FINANCE  - GRADUATION THESIS TOPIC: COMPLETING THE FINANCIAL ANALYSIS OF CORPORATE CUSTOMERS IN CREDIT ACTIVITIES AT VIETNAM INTERNATIONAL COMMERCIAL JOINT STOCK BANK - BA DINH BRANCH - HAO NAM TRANSACTION OFFICE Student : Nguyen Linh Trang Class : K20CLCD Course : 2017 – 2021 Student ID : 20A4011349 Instructor : Dr Nguyen Thi Dao Ha Noi, May 2021 PLEDGE I assure that this is my personal thesis which conducted under the guidance of Dr Nguyen Thi Dao The figures outlined in this thesis are honest, sourced and have not been published in any other researchs REATHINGS Nguyen Linh Trang ACKNOWLEDGEMENT In order to carry out this thesis, besides a small part is the effort and selfstudy effort, most of which comes from the guidance and support from the instructor, the officers from Vietnam International Commercial Joint Stock Bank – Ba Dinh Branch – Hao Nam Transaction Office Firstly, I would like to thank my lecturer - Dr Nguyen Thi Dao, who enthusiastically guided and encourage me Thanks to her advice and assessment that I was able to complete this thesis completely Secondly, I also would like to thank the staffs of Vietnam International Commercial Joint Stock Bank - Ba Dinh Branch - Hao Nam Transaction Office for supporting and helping me to complete my internship at the bank Ha Noi, May 2021 Nguyen Linh Trang CONTENTS PLEDGE ACKNOWLEDGEMENT ABBREVIATIONS LIST OF TABLES AND FIGURES INTRODUCTION 1 Rationales of thesis Objectives of thesis Subject(s) and scope of thesis Thesis methodology Literature review 5.1 Foreign literature 5.2 Domestic literature Thesis structure CHAPTER 1: THEORETICAL BASIS FOR FINANCIAL ANALYSIS OF CORPORATE CUSTOMERS IN CREDIT ACTIVITIES OF COMMERCIAL BANKS 1.1 THE NECESSARY OF FINANCIAL ANALYSIS FOR CORPORATE CUSTOMERS IN CREDIT ACTIVITIES OF COMMERCIAL BANK 1.1.1 Definition of corporate financial analysis 1.1.2 The necessary of financial analysis of corporate customers of commercial banks 1.1.3 Sources of information for financial analysis of corporate customers 12 1.2 FINANCIAL ANALYSIS PROCESS OF CORPORATE CUSTOMERS AT COMMERCIAL BANK 16 1.2.1 Planning analysis 16 1.2.2 Collect information 16 1.2.3 Analysis 16 1.2.4 Summarizing results 17 1.3 MAJOR METHODS USED IN FINANCIAL ANALYSIS OF CORPORATE CUSTOMERS AT COMMERCIAL BANKS 17 1.3.1 Comparative method 17 1.3.2 Ratio method 18 1.3.3 Dupont analysis method 19 1.3.4 Method analysis factor 21 1.3.5 Regression method 22 1.4 CONTENT OF FINANCIAL ANALYSIS OF BUSINESS CUSTOMERS AT COMMERCIAL CUSTOMERS 23 1.4.1 Balance Sheet Analysis 23 1.4.2 Income Statement Analysis 25 1.4.3 Cash Flow Statement Analysis 26 1.4.4 Financial Ratio Analysis 27 1.5 FACTORS AFFECTING FINANCIAL ANALYSIS OF CORPORATE CUSTOMERS IN CREDIT ACTIVITIES OF COMMERCIAL BANKS 36 1.5.1 Objective factors 36 1.5.2 Subjective factors 37 CONCLUSION CHAPTER I 39 CHAPTER 2: CURRENT SITUATION OF FINANCIAL ANALYSIS OF CORPORATE CUSTOMERS IN CREDIT ACTIVITIES AT VIB BA DINH BRANCH – HAO NAM TRADING OFFICE 40 2.1 OVERVIEW OF VIETNAM INTERNATIONAL COMMERCIAL BANK (VIB) – BA DINH BRANCH – HAO NAM TRANSACTION OFFICE 40 2.1.1 The process of formation and development 40 2.1.2 Organizational structure 41 2.1.3 Mobilized capital 42 2.1.4 Loan 45 2.1.5 Business operation 49 2.2 ACTUAL SITUATION OF FINANCIAL ANALYSIS OF BUSINESS CUSTOMERS IN CREDIT ACTIVITIES AT VIB – BA DINH BRANCH – HAO NAM TRADING OFFICE 51 2.2.1 Organization of analysis 51 2.2.2 Documents required 51 2.2.3 Analytical Process 52 2.2.4 Analytical methods 52 2.2.5 Analytical content 53 2.2.6 Illustrated example 53 2.3 GENERAL ASSESSMENT OF FINANCIAL ANALYSIS OF BUSINESS CUSTOMERS IN CREDIT ACTIVITIES AT VIB BA DINH BRANCH – HAO NAM TRANSACTION OFFICE 60 2.3.1 Advantage 60 2.3.2 Disadvantages and reasons 62 CONCLUSION OF CHAPTER 67 CHAPTER 3: SOLUTION TO COMPLETE FINANCIAL ANALYSIS OF BUSINESS CUSTOMERS FOR CREDIT ACTIVITIES AT VIB BA DINH BRANCH - HAO NAM TRANSACTION OFFICE 68 3.1 TARGETS OF VIB BA DINH BRANCH – HAO NAM TRANSACTION OFFICE IN CREDIT ACTIVITIES AT VIB BA DINH BRANCH – HAO NAM TRADING OFFICE 68 3.1.1 Credit development 68 3.1.2 Credit policy 68 3.1.3 Credit human resource 69 3.2 SOME SOLUTIONS TO COMPLETE BUSINESS FINANCIAL ANALYSIS IN CREDIT ACTIVITIES AT VIB BA DINH BRANCH – HAO NAM TRANSACTION OFFICE 69 3.2.1 Completing analysis content 69 3.2.2 Completing analytical methods 78 3.2.3 Completing customer information quality 83 3.2.4 Specialization of analysts 83 3.2.5 Improve the quality of credit officer 84 3.3 RECOMMENDATIONS 85 Recommendation to Ministry of Finance 85 CONCLUSION OF CHAPTER 86 CONCLUSION 87 REFERENCES 88 ABBREVIATIONS Abbreviation Original word BAP Beginning account payables BIDV The Joint Stock Commercial Bank for Investment and Development of Vietnam BS Balance Sheet CFS Cash Flow Statement Co., Ltd COGS Limited Liability Company Cost of goods sale EAP Ending account payables EBIT Earning before interest and taxes Hung Thinh Co., Ltd Hung Thinh Automobile Service and Trading Co., Ltd IS Income Statement ROA Return on Asset ROE Return on Equity ROS Return on Sales SeAbank TP bank VIB VIB Hao Nam Vietinbank VP Bank Southeast Asia Commercial Joint Stock Bank Tien Phong Commercial Joint Stock Bank Vietnam International Commercial Joint Stock Bank Vietnam International Commercial Joint Stock Bank Ba Dinh Branch - Hao Nam transaction office Vietnam Joint Stock Commercial Bank for Industry and Trade Vietnam Prosperity Joint stock Commercial Bank LIST OF TABLES AND FIGURES Table Page Table 2.1: The situation of capital mobilization of VIB Hao Nam in the period of 2018-2020 Table 2.2: Loan situation at VIB Hao Nam 2018-2020 Table 2.3: Outstanding debt at VIB Hao Nam 2018 – 2020 Table 2.4: Business operation situation at VIB Hao Nam 2018- 2020 61 65 67 68 Table 2.5: Income statement of Hung Thinh Trade And Service Co., Ltd period 2018-2020 74 Table 2.6: Balance Sheet of Hung Thinh Trade And Service Co., Ltd period 2018-2020 76 Table 3.1: Changes in account Assets of Hung Thinh Automobile Trading and Service Co., Ltd in the period 2018-2020 88 Table 3.2: Receivables of Hung Thinh Automobile Trading and Service Co., Ltd company in 2020 90 Table 3.3: Changes in total equity items of Hung Thinh Automobile Trading and Service Co., Ltd in the period of 2018-2020 91 Table 3.4: Assessing the relationship between Assets and Equity 93 Table 3.5: Liquidity ratio of Hung Thinh Co., Ltd company 94 Table 3.6: Activity ratios of Hung Thinh Co.,Ltd company 95 Table 3.7: Leverage financial ratios of Hung Thinh Co., Ltd 96 Table 3.8: Profitability ratios of Hung Thinh Co., Ltd 96 Table 3.9: Comparing Hung Thinh Automobile Trading and Service Co., Ltd ‘s Income statement to other companies in same industy in 97 2020 Figure Page Figure 2.1: Organizational structure of VIB - Hao Nam Transaction Office 60 Figure 2.2: Mobilized capital by time from 2018 to 2020 62 Figure 2.3: Capital mobilization chart by customer type from 2018 to 2020 Figure 2.4: Capital mobilization by currency from 2018 to 2020 Figure 2.5: Loan situation by customers from 2018 to 2020 63 64 67