A survey on the development of banking services at vietnam bank for agricultural and rural development cau giay branch from 2012 to 2015,graduation thesis

STATE BANK OF VIETNAM BANKING ACADEMY Foreign Language Faculty - - GRADUATION THESIS A SURVEY ON THE DEVELOPMENT OF BANKING SERVICES AT VIETNAM BANK FOR AGRICULTURAL AND RURAL DEVELOPMENT CAU GIAY BRANCH FROM 2012 TO 2015 Supervisor :M.A Tran Thi Thu Thuy Student :Than Yen Nhu Class : K15ATCC Student ID :15A7510179 Hanoi, 2016 STATE BANK OF VIETNAM BANKING ACADEMY Foreign Language Faculty - - GRADUATION THESIS A SURVEY ON THE DEVELOPMENT OF BANKING SERVICES AT VIETNAM BANK FOR AGRICULTURAL AND RURAL DEVELOPMENT CAU GIAY BRANCH FROM 2012 TO 2015 Supervisor :M.A Tran Thi Thu Thuy Student :Than Yen Nhu Class : K15ATCC Student ID :15A7510179 Hanoi, 2016 Graduation Thesis Banking Academy ACKNOWLEDGEMENT First of all, I would like to convey my gratitude to my supervisor, Ms Tran Thi Thu Thuy, MA from Foreign Language Faculty of Banking Academy for her significant contributions to my work Despite her bustling schedule, she was whole – hearted to offer me great inspiration, devoted advices and corrections during the research process from preparing to completing period It is obvious that without her guidance, I would not have finished this graduation thesis Secondly, I am very thankful to Ms Nguyen Thi Kim Oanh, Deputy Head of Administration Department, Mr Vu Thai Bao, Deputy Head of Marketing Department and Ms Pham Thi Thu Huyen, Head of Forex Department at Agribank Cau Giay Branch, whose support truly assisted me in collecting relating data and documents as well as technology explaination Besides, I would like to show my appreciation to all lectures of Banking Academy in general and teachers in Foreign Language Faculty in particular for the useful knowledge in many respects, which laid the solidly based for my research I also wish to express my heartfelt gratefulness to my family and friends for their greatly spiritual encouragement to help me complete my course at Banking Academy Last but not least, I would like to thank those who are spending time reading my graduation thesis Graduation Thesis Banking Academy STATEMENT OF AUTHORSHIP I declare that this graduation thesis named “A survey on the development of banking services at Vietnam Bank for Agricultural and Rural Development Cau Giay Branch from 2012 to 2015“ is the intellectual product of my own work which has not been previously submitted for my degree or examination in any other university All the sources I have used have been specified and acknowledged as completed references Signature THAN YEN NHU Graduation Thesis Banking Academy LIST OF ABBREVIATIONS No Abbreviations Meanings ABIC Agribank Insurance Company AEC Asean Economic Community Agribank ATM B/L Bill of lading CBs Commercial Banks CDs Certificates of deposit CIs Credit Institutions CPI Consumer Price Index Vietnam Bank for Agricultural and Rural Development Automated Teller Machine 10 E – banking 11 E – commerce 12 EDC Electronic Data Capture 13 FDI Foreign Direct Investment 14 Forex Foreign exchange 15 FTA Free Trade Agreement 16 IPCAS 17 IPO 18 IT 19 L/C Letter of credit 20 MIS Management Information System 21 NPLs Non – performing loans ratio 22 ODA Official Development Assistance 23 PBX Private Branch Exchange 24 POS Point of Sale 25 SBV State Bank of VietNam 26 TPP Trans – Pacific Partnership 27 WTO World Trade Organization Electronic banking Electronic commerce Interbank Payment and Customer Accounting System Initial Public Offering Information Technology Graduation Thesis Banking Academy LISTS OF FIGURES Figure Page Figure 3.1: Organizational Structure of Agribank – Cau Giay Branch 22 Figure 4.1: The capital growth at Agribank Cau Giay Branch from 2012 31 to 2015 Figure 4.2: The capital structure at Agribank Cau Giay Branch from 2012 33 to 2015 Figure 4.3: The relationship between fund mobilization and lending at 36 Agribank Cau Giay from 2012 to 2015 Figure 4.4: The outstanding loans at Agribank Cau Giay from 2012 37 to 2015 Figure 4.5: Bad debt to total outstanding loans ratio at Agribank Cau 41 Giay from 2012 to 2015 Figure 4.6: The volume of foreign currency trading at Aribank Cau 44 Giay from 2012 to 2015 Figure 4.7: The volume of international payment at Aribank Cau Giay 45 from 2012 to 2015 Figure 4.8: The volume of overseas remittance at Aribank Cau Giay 47 from 2012 to 2015 Figure 4.9: The volume of cards at Agibank Cau Giay from 2012 to 2015 49 Graduation Thesis Banking Academy LISTS OF TABLES Table Page Table 4.1: Outstanding loans situation according to terms at Agribank 38 Cau Giay Branch from 2012 to 2015 Table 4.2: Outstanding loans situation according to currency at Agribank 39 Cau Giay Branch from 2012 to 2015 Table 4.3: The volume of bad debts at Agribank Cau Giay Branch from 41 2012 to 2015 Table 4.4: The result of treasury accounting at Agribank Cau Giay from 2012 to 2015 53 Graduation Thesis Banking Academy LIST OF CONTENTS ABSTRACT Chapter 1: Introduction 1.1 Rationale of the study 1.2 Aim of the study 1.3 Scope of the study 1.4 Research methodology 1.5 Thesis structure Chapter summary Chapter 2: Literature review 2.1 Banking services 2.1.1 Definition 2.1.2 Types of banking services 2.2 Banking services development 13 2.2.1 Definition 14 2.2.2 The evaluation criteria of banking services growth 14 2.2.3 Factors affecting the potentiality of banking services expansion 15 2.2.4 Roles of burgeoning banking services 18 Chapter Summary 20 Chapter 3: Research Methodology 21 3.1 Research subject - Agribank Cau Giay Branch 21 3.1.1 Establishment and Development history 21 3.1.2 Organizational structure 21 3.1.3 General business activities 24 3.1.4 Business orientation in 2016 25 3.2 Research Methodology 26 3.2.1 Method orientation 26 3.2.2 The participants 26 3.2.3 The instruments 26 3.2.4 Data analysis 28 Chapter Summary 29 Graduation Thesis Banking Academy Chapter 4: Findings on banking services at Agribank Cau Giay Branch from 2012 to 2015 30 4.1 Fund mobilization services 30 4.1.1 Total mobilized fund 30 4.1.2 Mobilized capital structure according to maturity 32 4.2 Credit services 35 4.2.1 Total outstanding loans 35 4.2.2 Outstanding loans structure according to maturity 37 4.2.3 Outstanding loans structure according to currency 39 4.2.4 Non – performing loan ratio (NPLs) 40 4.3 Non – credit services 43 4.3.1 Foreign currency trading 43 4.3.2 International payment 45 4.3.3 Overseas Remittance 46 4.3.4 Card services 49 4.4 Other services 50 4.4.1 E – banking, M – Plus, etc 50 4.4.2 Insurance 51 4.4.3 Treasury and currency management 52 Chapter Summary 54 Chapter 5: Recommendations to improve the banking services development at Agribank Cau Giay Branch 55 5.1 Improving and modernizing technology 55 5.2 Developing the strength of available services 56 5.2.1 Fund mobilization 57 5.2.2 Bettering credit operation 59 5.2.3 Non – credit products 62 5.3 Branching out and improving the quality of banking services 65 5.4 Fostering the development of marketing and brand image 65 5.4.1 Advertising the branch’s brand 65 5.4.2 Strengthening opportunities of using banking services for customers 66 Graduation Thesis Banking Academy 5.4.3 Implementing the supply of products and services 66 5.4.4 Performing advertisement campaigns 66 5.4.5 Reinforcing the public relations and customers services 66 5.5 Improving the quality of governance, inspection and internal control 66 5.6 Perfecting the distribution channels system 67 5.6.1 For traditional distribution channels 67 5.6.2 For modern distribution channels 67 Chapter summary 68 CONCLUSION 69 REFERENCES 71 Graduation Thesis 57 Banking Academy Lastly, it is evident that ensuring financial security in all activities of the bank while reforming transactions manner, building up the personal brand and creating a favorable business environment thereby maximum profitability are other assignments which ought to be deployed by Agribank in general and Agribank Cau Giay in particular 5.2.1 Fund mobilization Capital mobilization serves the industrialization and modernization of each country It is a condition as well as a prerequisite for the performance of the capital utilization At the same time, it is considered the decisive factors to the profitability of the bank capital In other words, providing that such operation is effectively conducted, it will positively impact the work of the bank's funding Therefore, the CBs in particular and the whole banking system in general in our country must constantly innovate, offer appropriate solutions and measures for each economic region, economic sector to attract the majority of idle capital in order to maximize internal forces of the economy Having recognized the importance of this activity, a number of specific recommendations are proposed to improve the quality and efficiency of capital mobilization 5.2.1.1 Diversifying the forms of fund mobilization Besides traditional forms of raising capital such as receiving deposits, the bank needs to implement and offer modern types, for example, accumulated savings, the school savings or household savings, etc with different terms at various interest rates which either are sensitive or ensure the rights of depositors, the borrower and the bank Apart from the capital mobilization in VND, Agribank Cau Giay needs to expand the forms of raising capital in foreign currencies such as savings, bills of exchange, overseas remittance services Moreover, the banks should attach special importance in the effective medium and long term fund exploitation since they are very necessary to serve the country's renovation work, court the concessionary resources of international financial institutions In addition, Vietnamese people are in the habit of saving to prevent illness or unexpected events Having grasped such mentality, Agribank in particular and CBs in general have launched several deposit maturities with different interest rates to attract funds To implement differentiated strategies in the fiercely Graduation Thesis 58 Banking Academy competitive environment nowadays, Agribank Cau Giay Branch is required to draw up more appropriate measures to attract maximum funds Initially, the bank can perform questionnaire surveys and market analysis to divide the economic regions and customers segments Especially, it is essential to focus on customers with high income, intelligentsia contributing to the target market and customers decision The bank from that point should chalk out measures to increase competitiveness in such market segment by increasing utilities for the products Furthermore, the bank can expand the implementation of products and services support such as payment service at home or through accounts, etc to attract depositors as at the same interest rate, customers will choose the product offering lots of gadgets with more reasonable fee In addition, the bank should automatically transform demand deposits into term deposits for customers 5.2.1.2 Adjusting the appropriate interest rate policy The interest rate is one of the basic elements by which customers will compare and decide to bank to trade and send their money to In general, they always want to deposit money to the banks having relatively high interest rates to earn more However, on the condition that the rates increase inevitably bringing about the upsurge in lending interest rates, this will result in greater pressure on individuals and businesses who are currently borrowing money from the bank Hence, to ensure the smooth mobilization activities, the bank needs to adjust interest rates in a flexible way which is suitable for each period and each customer The rates frame is stipulated by the SBV and the business situation of the bank so as to confirm the benefits of the people concerned Deposits fund of Agribank Cau Giay generally accounts for 50% and above of the total capital in which the share capital from the market is inconsiderable Therefore, in order to attract and maintain the stability of customer deposits, Agribank Cau Giay has to pay a competitive interest rate compared to others in the operational area This will increase operating costs and reduce the potential earnings of the bank Consequently, to ensure mobilization capital and profit growth, Agribank Cau Giay needs to build a policy of flexible interest rates policy based on the following fundamental issues Graduation Thesis 59 Banking Academy Firstly, the branch should continuously monitor and count the fluctuation of the market interest rates as well as the policy of government in matters relating to interest rates Secondly, scheduling the branch’s funds sources based on the annual business direction of Agribank is regarded as another task which the branch ought to concentrate on Thirdly, Agribank Cau Giay is required to offer interest rates which actually reflect the currencies supply – demand relationship and closely keeping track of the inflation and competitiveness fluctuations in the market 5.2.2 Bettering credit operation 5.2.2.1 Efficiently developing customer portfolio and projects with high feasibility The bank needs to classify and select lending objects and investment projects with low risk especially businesses which have had long – term relationships with the branch In addition, it is essential to concentrate on the technological innovation investment projects in order to quickly carry out the loan and interest recovery 5.2.2.2 Ensuring and improving the quality of assessment in accordance with the credit evaluation Credit quality is reflected in the timely principal and interest repayment of customers To conduct the lending operation, the bank must always appraise customers before giving loans to customers in order to examine their ability to pay Appraisal of business customers is the activity in which the bank objectively analyzes and investigates all aspects of the business such as the evaluation of creditworthiness, the legal status, the financial capacity, the practicability of projects, etc This is the most important step in the process of providing credit It determines the quality of the loans and the level of risk that Agribank Cau Giay might encounter Therefore, Agribank Cau Giay must constantly improve the quality of the appraisal operation Effectuating such competence, Agribank Cau Giay will be able to solve two problems, namely the level of bankers’s assessment and evaluation activities management organization 5.2.2.3 Promptly consolidating and completing the collection, storage, information processing to serve both the appraisal as well as the provision of credit Graduation Thesis 60 Banking Academy It can be said that information system is the beginning for the modern economic activities in general and each credit decision of CBs in particular As a result, to obtain high quality loans, the credit information system is required to be flexible and accurate On the basis of the collected information, Agribank Cau Giay has implemented the assessment of the accuracy, completeness and timeliness of such information as a foundation for the customer evaluation Besides, a separate Credit Information Department is also considered an effective suggestion to enhance the quality of credit activities This is a challenging task with the current scale of the branch, but it can be extremely helpful if Agribank Cau Giay deploys it in the near future 5.2.2.4 Improving credit processes and procedures Credit process is the sequence of steps that the bank has to perform from receiving loan application, appraising, giving lending decisions, disbursing, monitoring, collecting debts to liquidating the credit agreement Credit process and procedures play a significantly important role to limit risks as well as affect the time and efforts of businesses and CBs Therefore, the amelioration of such thing is necessary In addition, the improvements must be timely to perfect the quality and efficiency of lending 5.2.2.5 Enhancing the ability to prevent and control the risks involved in operating activities To start with, the branch must establish a credit loss provision This is the required task in which the amount of risk reserve is appropriated according to a certain percentage of the bank's total income and owner’s equity The bank can appropriate funds by months, quarters or years on the basis of overdue balances of the previous period Moreover, it needs to proactively address non – accrual loans In debt recovery activities, there needs to be constantly concerned with the detection of problematic loans to timely propose measures to minimize risks to the lowest level 5.2.2.6 Firmly handling outstanding loans and bad debts to the lowest level as possible First of all, Agribank Cau Giay must acknowlege its actual outstanding loans situation to publish suitable measures in the accrued overdue loans processing Such process Graduation Thesis 61 Banking Academy must comply with the current mechanism combined with the flexible handling measures to avoid losses to the bank while assisting enterprises extricate difficulties Next, Agribank Cau Giay should enquire about the reasons that businesses can not repay in due Whereby, the bank is properly able to analyse the root of araising overdue loans and assess the debt status of each credit contracts according to the economic types, the loan terms and the ability to recover capital to get appropriate treatment measures In case of objective reasons, Agribank Cau Giay may extend debt to help businesses gain time to prepare for repayment When the bank is unable to further extend, it depends on the capital usage purpose to alter from short – term to medium – term loans or petition such businesses for supplementing loan collaterals and pledges to whom have repayment ability, are willing to repay or have paid the part of principals, the sufficient monthly interest payment and have prestige with the bank but currently encountering some difficulties because of irresistible reasons However, providing that the bank can not extend the repayment period, it should encourage, persuade customers to voluntarily sell their properties to repay to be served the deducted overdue and present interests For those circumtances that customers intentionally delay the repayment, the bank needs take advantage of the support from the appropriate authorities, resolute force the debtors allot their properties to the bank to rent out or put on compulsory sale with an aim at the capital recovery Last but not least, it is required to assign overdue debts recovery quotas to each credit officer and consider the business salary payment To achieve the emulation titles, credit officers must complete the overdue treatment targets Furthermore, the bank should reward for individuals who have gotten considerable achievements when handling overdue loans 5.2.2.7 Strengthening the loans monitoring The monitoring process of loans utilization will help the bank control the borrowers’s behaviour and ensure that funds are efficiently used for the right purposes Nevertheless, the current loan monitoring is just concentrated mainly on the examination of the latest financial statements and certain related bills, etc or periodic monitoring It is obvious that such way would not timely detect the occurred events in enterprises especially in the morality of the financial statements Therefore, Agribank Graduation Thesis 62 Banking Academy in general and Agribank Cau Giay in particular should carefully and seriously organize controlling process to certify the evaluation and consideration of all the most important features of the loans 5.2.3 Non – credit products 5.2.3.1 Foreign currency trading To begin with, the branch should continue to improve the mechanism and enhance the marketing operations to convince customers of using foreign currency trading derivatives As we have seen, although Agribank has deployed foreign currency trading derivative operation for many years, the volume of sales as well as income from these products is still unobstrusive compared to the potentialities of the Vietnamese foreign currency market Hence, continuing to amend the mechanism and strenthening customers marketing is considered a necessary task and should be comprehensively carried out immediately However, in the current trading market, the application of derivative instruments is still very new and has not been widely utilized since the transactional practices between businesses and CBs are still within a limited scale To understand and apply the currency derivative instruments in preventing exchange rate risks of CBs in order to bring these services to businesses, the bank needs to experience a long path in approaching enterprises relating to forex transactions Moreover, the banks should hold seminars to introduce and advise new types of services with an aim of either raising businesses’s awareness on exchange rate risks or helping them have a thorough knowledge and be accustomed to such derivative instruments In addition, the bankers are required to nourish their knowledge and experiences on the forex market and international currency market, forex derivative transactions analysis skills, fundamental analysis on the basis of selection, synthesis and information analysis to predict the trend of the market development in order to effectively use the derivative instruments From such point, they are able to advise, guide and help businesses be greater concious of the forex market Trading officers must apply flexible tools to prevent exchange rate risks for investment portfolio in foreign currency Besides, they have to develop or sell the derivative products to enterprises having international commercial activities Graduation Thesis 63 Banking Academy Besides, it needs to provide enclosed services in foreign trading activities for free The bank may distribute serveral accompanied services such as financial – monetary, exchange rate, payment methods, the exchange rate policy application or high competitive cost advices Furthermore, the issue of choosing the most favourable exchange rate for payment calls for the instruction of the bank because enterprises can not grasp the trends for each exchange rate type since such businesses are nonprofessional in foreign trading activities and insufficient on the necessary means and information Agribank Cau Giay should identify key roles and indispensable work of advising customers to help them penetrate the implementation methods, exchange rates trends, etc so that such information will become an efficient factor supporting businesses in the foreign trade contracts The final objective of this solution is to make customers feel that they are indispensable to useful advice from the bank in their business activities whereby they will be increasingly attacted to the bank In addition, the bank can expand foreign currency trading in the interbank market and international market In the forex interbank and international foreign currency markets, the bank has performed only foreign currency transactions when customers have particular needs of rates risks insurance or there is a corresponding performance demands when buying or selling foreign currencies to customers but it has little actual business transactions Therefore, Agribank should expand such operations in the interbank and the international markets since they have huge potentialities not only in transaction volume but also in the variety of products 5.2.3.2 International payment operation Initially, Agribank in general and Agribank Cau Giay in particular should indensify the financing balance for export – import enterprises In fact, the effect of import and export payment operations depends on the production and business situation of such enterprises Providing that these businesses are funded, they will effectively operate and establish their own prestige thus pushing up the import – export payment Additionally, the branch ought to maintain customer network, build up the appropriate policies and analyze direct competitors In the fiercely competitive environment caused by the establishment of a series of Joint – Stock CBs and especially the presence of the foreign bank branches recently, Agribank Cau Giay is required to Graduation Thesis 64 Banking Academy chalk out attractive and flexible policies The bank should speed up marketing strategies and propose satisfatory incentives to its customers, diversify the types of international payment services, business forms such as SWAP, futures operations, etc in order to attract foreign currency supply from new organizations and businesses Lastly, it is involved in ensuring the pleasant, fast and accurate international payment services and foreign currency businesses performances to serve customers to maintain and develop international payment operations of traditional customers at the branch then raising the position in the customers’s evaluation 5.2.3.3 Overseas Remittances Firstly, the branch needs to consolidate relations with the officious remittance channels and gradually transform these informal channels into agents obtaining money for the bank Such measure will help to progressively swift overseas remittances from unofficial channels to official one Besides, these informal money transfer agents also have potentialities to become the first permanent customers of CBs in Vietnam when they open overseas branches Next, the construction of packages products for target customers who are Vietnamese residents and Vietnamese workers in foreign countries is regarded as another assignment which should be conducted by Agribank The supply of such product packages will help them have motivations to save and deposit foreign currency to the country The potential of this product is significant because in many countries, the Vietnamese community is quite successful with high income and status If the banks know how to exploit the investment demands in their home countries, they will absolutely fascinate promising customers segments Last but not least, the bank ought to actively disseminate information about the remittances benefits and procedures to overseas Vietnamese and Vietnamese workers According to a research, one of the reasons that these customers send money through informal channels is the habits and advices of the other people It seems that the information about the remittances procedures through formal channels are not completely and accurately known by such people Thus, the propagation of information on investment opportunities in the country, attracting remittances policies Graduation Thesis 65 Banking Academy of the government, the support of CBs in transferring remittances, investment channels selection as well as the investment performance is considerably essential 5.3 Branching out and improving the quality of banking services The inappreciable products difference among CBs has led to the current situation that the banks have to compete on price causing the market segregation It is also considered the inadequacies of the monetary market in Vietnam today Besides, illutrious financial corporations and banks increasingly crave for investing in Vietnam This will be an opportunity and a challenge for CBs Thus, the CBs system must improve their competitiveness by developing, diversifying new products and services with excellent facilities in order to create the most favorable conditions to attract customers To start with, the bank can expand new deposit services such as adjusting savings interest rate depending on the market, retirement savings and offering interest rate changes given to term deposits In addition, it needs to enlarge the new deposit instruments such as certificates of deposit (CDs), the valuable papers, etc Moreover, the branch should either thrive on the distribution system and payment methods or diversify the types of cards such as credit cards, ATM cards, debit cards, the associated cards, etc Finally, Agribank Cau Giay has to promote the new lending products, diversely investing to disperse risks as credit borrowings, installment loans, transactions lendings or co – financing projects 5.4 Fostering the development of marketing and brand image 5.4.1 Advertising the branch’s brand To achieve the goal of developing products and services, Agribank Cau Giay must affirm its credibility with customers This depends on many different factors; however, it can be said that marketing will be a bridge between customers and branches Wishing customers thoroughly understand about the branch as well as the supply of products and services, the bank needs to enhance the forms of promotion through the mass media such as advertisements, websites, fairs and exhibitions, etc; participate in charity activities, social security works or engage in funding for the programs expected to attract attention of the populace Graduation Thesis 66 Banking Academy 5.4.2 Strengthening opportunities of using banking services for customers The branch should design a special website to assist customers easily and efficiently access to modern banking products Moreover, the bank can organize seminars, client meetings with the large enterprises and the traditional customers of the bank to introduce modern products or instruct operational process for customers 5.4.3 Implementing the supply of products and services Complex products and services require the bank to help customers in the utilization and clear the customers’s questions up Hence, the bankers must have the incentive knowledge about such services and the crucial experiences to help clients For example, with SMS Banking and Mobile Banking products, customers offen wonder about the syntax, the swallowed cards or debited without knowing the causes, etc 5.4.4 Performing advertisement campaigns The branch needs to develop promotional strategies to ensure two factors namely the spaciousness being suitable for wide variety of subjects and the advertising intensiveness which means information about the products and services Furthermore, it is obvious that the bank should build a pleasant image, enhance its prestige in order to make a good impression on clients about the modern banking products since once customers have the good feeling (quality, utilities, services attitude), they will become the indirect marketing officer for the bank by referring to their friends and relatives about the products and services 5.4.5 Reinforcing the public relations and customers services The increasingly consolidating relationships intensification between customers and the bank will help both sides understand each other and obtain the win – win cooporation Customer service is an important step to help CBs retain their incident customers and increase their prestige, namely focusing on activities after providing services, resolving arising complaints, building up polite and professional staff when communicating with customers 5.5 Improving the quality of governance, inspection and internal control Springing from the point that the internal audit is a significantly important stage in the banking sector as it directly affects on preventing, detecting and promptly handling the risks that may occur in the bank operations (credit risks, risks of assets loss) in an Graduation Thesis 67 Banking Academy objective or subjective way (self – interested, deliberately against, fraudulent behaviors in the banking sector) It is evident that efficient internal control activities will indirectly help CBs increase profits and enhance their competitiveness Therefore, Agribank Cau Giay should implement following measures For each field of banking activities, the branch should develop official copies about the specific processes skillfully combining such barricades to help bankers easily control during operations Moreover, the bank needs to constantly elevate the quality of administration, inspection and internal control This work must be regularly raised to be worth with the modern technology In addition, the branch is required to regularly examine the process, the internal regulations of the branch to complete, supplement, upgrade and avoid vulnerable weakness 5.6 Perfecting the distribution channels system 5.6.1 For traditional distribution channels With growing income levels, the bank branches today are not only regarded as a center of deposits attraction but also reflect the customers’s access level to the banking products and services The services supply is performed by tellers and bank staff through direct transactions with customers To increase total sales, the branch should continue to expand the distribution channels through the transaction offices and the transaction points At the same time, the branch ought to strengthen infrastructure and improve staff capacity through the professional competence training programs to maximum the volume of sales and reduce operating costs to the minimum level 5.6.2 For modern distribution channels In order to exploit such channels, the bank initially needs to intensively provide as well as promote information to its customers To accomplish that goal, the bank can use products and services advertising leaflets to introduce new products, their gadgets and distribution channels to customers In addition, besides providing and proposing solutions for customer inquiries, callcenter services may also be used as a marketing channel when the bank Graduation Thesis 68 Banking Academy accompanies with its employees proactively contact customers to introduce information about products and services Moreover, the bank should develop the ATM channel, POS, Electronic Data Capture (EDC) in sales units Last but not least, it is required to strengthen and expand the customer registration of mobile services Furthermore, the bank needs to launch marketing programs to attract corporate clients, organizations, agencies and units register to use this form of distribution channels Chapter summary From the base of theoretical research and current situation providing banking services analysis at Agribank Cau Giay Branch, the fifth chapter of the thesis has proposed a system of measures to not only develop, diversify products and services but also improve operational efficiency at the branch in particular and the whole Agribank system in general The recommendations are practical and feasible to meet the increasingly diversified needs of customers In addition, they will contribute to bring about the efficiency in business operations in the nowadays fiercely competitive environment and heighten a new level for Agribank Cau Giay Branch Graduation Thesis 69 Banking Academy CONCLUSION In the context that the world economy is facing a significant financial crisis and the domestic economy experiences a vast array of changes recently, Agribank in general and Agribank Cau Giay in particular have been continuously focusing on the innovation and investment of modern technologies as well as the improvement of accounting payment system (IPCAS) In addition, the bank has not only expanded distribution channels but also diversified the portfolio of products and services The branch’s competitiveness in the field of products and services has been undergone the positive revolution which contributes to enhancing the status and image of Agribank However, beside such achievements, there are still certain drawbacks and restrictions which are not commensurate with the potential and the position of the bank and on the finance – banking market To maintain and maximize the inherent potential hence winning the competition, Agribank Cau Giay along with other branches in the same system has to build up strategies implementing specific objectives in line with their area of operational business It is also considered one of the important and imperative missions which are set out in the strategic development from 2016 to 2020 With the desire to contribute to diversifying the types of products and services at the branch, the author has based on the application of scientific research methods and practical data to complete the following tasks Firstly, the thesis has systematized theoretical issues and the current situation of products and services of CBs Besides, the definition, characteristics, factors affecting the competitiveness of banking services as well as the criteria namely either qualitative or quantitative criteria to evaluate the CBs’s development ability have been evidently specified In addition, the urgency of diversifying and developing banking services in the increasingly fierce competion between CBs has been clearly analyzed Secondly, the researcher has investigated the supply situation of products and services at Agribank Cau Giay in the period from 2012 to 2015 From that point, the readers may recognize the products being at a strong position as well as services which need to be considerably concentrated on the investment by the branch in the near future Thirdly, on the basis of such theory and reality, the author has suggested solutions in a systematic way in order to improve and develop banking products at the branch Graduation Thesis 70 Banking Academy Therefore, Agribank Cau Giay can achieve the satisfactory results in the process of becoming a versatile and effective commercial bank To conclude, the author hopes that such subject will make a contribution to enhance the competitive ability of Agribank in general and Agribank Cau Giay in particular in the financial crisis situation nowadays Although the thesis has been deeply studied, due to the limited time and capability, it can not be evaded several shortcomings Therefore, the author desires to receive the feedbacks from lecturers so that the research will be improved Graduation Thesis 71 Banking Academy REFERENCES Vietnamese: GS.TS Nguyễn Văn Tiến (2013) Nguyên lý Nghiệp vụ Ngân hàng thương mại NXB Thống Kê PGS.TS Nguyễn Minh Kiều (2013) Nghiệp vụ Ngân hàng thương mại đại NXB Tài PGS.TS Nguyễn Minh Kiều (2008) Nghiệp vụ Ngân hàng NXB Thống kê Ngân hàng Nông nghiệp phát triển Nông thôn Việt Nam – Chi nhánh Cầu Giấy (2012 – 2015) Báo cáo tài thường niên English: Bencivenga, V.R and Smith, B.D (1991) Financial Intermediation and Endogenous Growth, Review of Economic Studies, pp 195 – 209 D Muraleedharan (2014) Modern Banking: Theory and Practice, 2rd ed Dr C Satyadevi (2009) Financial Services Banking and Insurance H.R Machiraju (2007) Modern Commercial Banking, 2rd ed Kasekende, L (2008) Developing a Sound Banking System Paper presented at IMF Seminar, Tunisia 10 M.N Gopinath (2014) Banking Principles and Operations, 5th ed 11 Peter S Rose and Sylvia C Hudgins (2012) Bank Management and Financial Services, 9th ed 12 The Indian Institute of Banking and Finance (2010) Banking Products and Services 13 The Indian Institute of Banking and Finance (2007) Information Technology, Data Communications & Electronic Banking, 2rd ed Websites: 14 The General Statistics Office of Vietnam website: www.gso.gov.vn 15 The State Bank of Vietnam website: www.sbv.gov.vn 16 Vietnam Bank For www.agribank.com.vn Agriculture and Rural Development website: