vietnam international commercial joint stock bank group assignment

Body2.1 Internal environmentThe tertiary sector of the Vietnamese economy, which includes services like banking andfinance, is where VIB Bank works as a significant player in the country

VIETNAM INTERNATIONAL COMMERCIAL JOINT STOCK BANK

GROUP ASSIGNMENT

INTRODUCTION OF MANAGEMENT (MGT103)CLASS:

GROUP MEMBER:

Vietnam International Commercial Joint Stock Bank

Table 1 General introduction

VNR500 rating 22(B2/2022)-54(B1/2022)

Head office 1st floor (ground floor) and 2nd floor, Sailing TowerBuilding, 111A Pasteur, Ben Nghe Ward, District 1, City HoChi Minh City, Vietnam

establishment and development VIB has been present in almost all parts of the country,present in 27 provinces and cities, including 162 branches and transaction offices with morethan 5000 employees serving and answering questions VIB has constantly tried to providethe best services to customers, so VIB has built the trust of customers because VIB isorienting to develop the retail banking segment through many distribution channels andproviding the most optimal economic solutions for customers It is because of this remarkableimprovement that VIB is constantly developing.

2 Body

2.1 Internal environment

The tertiary sector of the Vietnamese economy, which includes services like banking andfinance, is where VIB Bank works as a significant player in the country's banking sector.These include the evaluation of collateral, the sale and use of collateral assets, and theadministration of finished products as collateral assets.

A crucial component of lending operations is the valuation of collateral, and VIB Bank hascreated a strict procedure for doing so By doing this, the bank is able to evaluate the worth ofthe collateral with accuracy and lower the risk of loan defaults.

Generally speaking, VIB Bank is involved in a number of activities involving collateral assetsin the tertiary sector, highlighting the bank's dedication to risk management and guaranteeingthe stability of its loan operations.

VIB Bank is a prominent player in Vietnam's banking industry, and its internal environmentis shaped by several key factors VIB Bank operates within several economic sectors,including retail banking, corporate banking, and consumer finance This diversity of sectorsallows the bank to mitigate risk and leverage opportunities across different areas of theeconomy.

In terms of its workforce, VIB Bank employs a significant number of individuals across itsvarious business units The bank had 9658 employees as of December 31, 2021 The bankplaces a strong emphasis on employee development and engagement, offering trainingprograms and opportunities for career advancement This focus on its workforce helps tocreate a positive internal environment that fosters innovation and collaboration.

In 2021, VIB Bank generated a total revenue of approximately 20,949 billion VNDVietnamese dong This revenue is a testament to the bank's strong market position and abilityto generate income across its various business units The bank's revenue performance alsoreflects its ability to adapt to changing market conditions and customer needs.

Finally, in 2021, The total capital of VIB Bank was 15,531,429,930,000 VND This capitalprovides the bank with the financial resources needed to support its growth and expansioninitiatives With strong capital reserves, VIB Bank is well-positioned to weather anyeconomic challenges that may arise in the future.

within Vietnam's economy, its strong workforce, impressive revenue performance, and robustcapital reserves These factors contribute to the bank's success and help to create a positivework culture that is conducive to innovation and collaboration.

2.2 External environment

VIB Bank is one of the banks with a broad strategic vision, which is developing strongly inthe Vietnamese banking market However, in order to continue to stand firm in the market,VIB needs to fully recognize external environmental factors.

VIB's competitors are big banks such as American Express, HSBC, Citibank, MSB, SCB,SeABank, SHB, TPBank, HDBank, OCB These competitors also have many attractive newpolicies, promotions, products, and services to attract their customers Therefore thecompetition with potential rivals is high.

VIB's customers are a wide audience, including individuals and households, businesses, andorganizations Therefore, to attract customers, banks need to provide the best products andservices, and at the same time create a professional and customer-friendly workingenvironment.

In addition, VIB is cooperating with invisible service providers such as web and SMS ofcarriers, delivery services of Shoppe, Lazada, and aviation services such as VietNamAirline, to create discount events or promotions when using VIB's services for payment, inorder to increase value for customers.

However, VIB also faces competing services that can replace its services, such as lendingservices with lower interest rates, unlimited loans, investment in real estate or gold.

Therefore, in order to achieve success in the banking market, VIB needs to fully recognizethe external environmental factors and come up with appropriate policies to create the highestvalue for customers.

(Source: VIB Annual reports, 2021)

Departments within an organization often have specific roles and functions to ensure that theorganization's operations are carried out efficiently Here are the roles of Marketing, HumanResources (HR) and Finance departments in an organization:

The Role of the marketing department is to determine the type of products and services thatthe bank needs to provide to the market, then the marketing department will collect marketinformation, research consumer behavior, and customer choice of banks Organize theprocess of providing products and services with three factors: technical facilities, direct staffand customers.

The HR department has the role of managing all issues related to the construction,management and development of quality and sustainable HRto ensure the growing businessand this is the role of the HR department of VIB bank The first is recruitment The HRDepartment will post recruitment information, then select resumes and interview, theinterview content mainly asks about banking operations The second role is to train personnel.VIB currently has a training department under the HR department and has 2 offices for thiswork with full facilities in Ha Noi and Ho Chi Minh City The next role is to evaluatepersonnel HR evaluation is extremely important to reward and re-train weak employees.Currently, VIB has 2 annual HR evaluation periods in the 2nd and 4th quarters The fourth

structure to help VIB reduce costs but still meet the requirements of focus Last but not leastis customer orientation Currently, VIB operating policy is customer-oriented, VIB strategy is"to become the most innovative and customer-oriented bank in Vietnam".

The finance department is the one that is basically responsible for choosing the company'sinternal and external financial policies The gathering and processing of the company's tradedfunds is the responsibility of the financial office In addition to maintaining smooth, efficientcommercial operations, the department also oversees income and expenses Besides, thefinance department's duties also include doing economic analysis to enhance importantcorporate plans In annual reports, we know that the total income of VND 309.517 billion isan increase of more than 19% compared to 2020 It is an example of the simple task of thefinance department.

In short, the Marketing, HR and Finance departments play an important role in ensuring thatthe organization's operations are carried out efficiently and that the needs of customers andshareholders are met.

2.4 One to two management issues or challenges faced by that company

In the context of the complicated Covid-19 pandemic situation as well as the complicatedeconomic situation, many businesses suffered heavy losses, even going bankrupt As a result,the risk of growing bad debt is unavoidable VIB bank is no exception, in 2021 VIB has notbeen able to control the quality of bad debts The value of bad debt increased byapproximately 58%, from 2,957 billion VND at the start of the year to 4,669 billion VND Inmore detail, doubtful and subprime debt increased by 208% and more than 101%,respectively As a result, from 1.75% in 2020 to 2.32% at the end of 2021, the ratio of baddebt to loan balance increased Besides, based on data from VIB's financial statements from2017 to 2021, we can see that VIB's bad debt ratio increases rapidly in 2021 and riskprevention for goods is not focused on VIB.

Additionally, the bank's disbursement and tax payment have not been handled smoothly The

This is not the first time VIB has paid a tax penalty.

We all know that the company's financial issues will always be an issue in the operationprocess As a result, the difficulties that VIB is experiencing are understandable However,VIB must pay more attention to how the finance department operates smoothly and quickly inorder to increase customer trust and be more stable in the future.

2.5 Suggestions and strategies to overcome the obstacles

Specific (S) - Increasing the value of Foreign capital mobilization, Forextrading operations and Customer deposits and valuable papers tomaintain and develop business activities.

Measurable(M) - Foreign capital mobilization: 20% increase compared to 2021(27,3 trillion VND)

- Forex trading operations: 10% increase compared to 2021(118.8 billion VND)

- Customer deposits and valuable papers: 20% increase comparedto 2021 (259 trillion VND)

Achievable(A) - With diversified capital mobilization, well-establishedrelationships with domestic and foreign financial institutions andreputation among clients over the past 27 years, this plan can beaccomplished well.

Relevant(R) - In order to consolidate and develop the company's capital in orderto avoid the severe impact of customer bad debts.

- Foreign capital mobilization: increase by 5-6 trillion VND- Forex trading operations: increased 35-40 billion VND- Customer deposits and valuable papers: 60-65 trillion VND

Table 3:

Completing the upgrade and implementation of the anti money laundering system in 2022.

Specific (S) 6-step process:

- Guidelines from central banks and guidelines from anti-moneylaundering.

- Examine the current state of VIB's PCT system to identify flawsand vulnerabilities and make necessary changes.

- Conduct PCT awareness training for VIB staff and teach themhow to detect and report suspected money laundering orunauthorized money transfers.

- Update VIB's PCT policies and procedures to meet regulatoryrequirements and apply risk controls to reduce the risk of moneylaundering.

- Implement cutting-edge PCT technologies and solutions to boostVIB's PCT performance, such as data analysis systems orblockchain technology to monitor financial transactions anddetect fraudulent or suspicious activity.

- Conduct periodic assessments and monitoring to ensure thatVIB's PCT system is operating properly.

Measurable(M) In 2021 there are 20 suspected cases of money laundering

identification (eKYC) processes to minimize risks, meet internationalstandards on anti money-laundering Besides, in addition to constantlykeep abreast of AML trends on anti-money laundering in the world, stafftraining is also paid special attention to raise the compliance awarenessof employees and to ensure full and appropriate compliance in consistentwith the development of banking products

Relevant(R) Create a new AML system to satisfy integration needs, automate theKYC process, and improve monitoring of suspicious activity.

Time-bound(T) The first 2 quarters of upgrading the money laundering screeningproject:

Refer to the anti-money laundering laws and policies of VIB Bank to

Contact relevant departments in VIB to understand their requirementsand expectations for the upgrade project.

The following 2 quarters apply and screen the following cases:

Define criteria for evaluating suspicious transactions and accounts,including risk metrics and data analysis models.Perform suspicious transaction and account screening by applyingdefined criteria and using appropriate data analysis tools.Identify potential cases of money laundering or financial terrorismrelated activities and notify the appropriate authorities.

In order to operate the bank's capital well, we need a system to strictly control the cashoutflow We need to consider carefully before lending money to any company At the sametime, banks must regularly check lending activities during the prescribed period to preventrisks and avoid capital loss of the company To help capital grow well, the investorsdepartment of VIB has to determine a wise investment strategy With customers' deposits,banks need to devise a strategy to allocate capital for each business plan in a reasonable

capital of the business.

Applying Artificial Intelligence to money anti-checking systems is one of options that VIBshould consider Set up with a high precision algorithm, this automatic system will ensure theprogress of the work AI can link transaction information over a set time period to findanomalies Manual control makes it difficult for employees to capture ambiguous connections,thereby ignoring suspicious manifestations, opening the way for money laundering Thissystem upgrade is a worthwhile investment that the bank should consider Reducing moneylaundering transactions contributes to promoting the long-term and sustainable developmentof the country's economy This also helps the bank's business activities become stable.

3 Conclusion

In short, an action to be considered good must meet the criteria for the benefit of the companyand the interests of society However, VIB had bad debt, this bad action has partly lost thereputation of customers for the company, this is inevitable for businesses in general and VIBin particular But now, VIB's bad debt ratio has decreased many times In recent years, VIBhas grown significantly compared to previous years VIB has cooperated with leadingtechnology applications such as Big Data, and AI, which will help customers pay more easilyand save money These are also factors and strengths of VIB that have helped this bank leadin online transactions Although not one of the top banks in Vietnam, VIB has promoted itsstrengths and made progress day by day This is also a good thing, and hopefully, VIB willbring more incentives for customers.

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d34817.html#:~:text=Theo%20Quy%E1%BA%BFt%20%C4%91%E1%BB%8Bnh%20s%E1%BB%91%201839,t%E1%BB%AB%20n%C4%83m%202019%20%C4%91%E1%BA%BFn%202021 (Accessed: March 14, 2023).