Factors Affecting Individual Customers' Decision To Deposit Savings At Vietnam Joint Stock Commercial Bank For Industry And Trade - Saigon South Branch.pdf

HO CHI MINH CITY, 2024

HO CHI MINH UNIVERSITY OF BANKING

MINISTRY OF EDUCATION AND TRADING STATE BANK OF VIETNAM

HO CHI MINH UNIVERSITY OF BANKING

INSTRUCTOR

ASSOCIATE PROFESSOR PHD LE DINH HAC

ABSTRACT 1 Subject tittle

Factors affecting individual customers' decision to deposit savings at Vietnam Joint Stock Commercial Bank for Industry and Trade - Saigon South Branch

2 Contents

Firstly, this study synthesized relevant theoretical frameworks related to consumer behavior, identifying theorretical factors influencing customers' choices of products and services for consumption Moreover, the author reviewed and identified research gaps, proposing a research model

Secondly, this study identified and measured the factors influencing customers' decisions to deposit savings at Vietnam Joint Stock Commercial Bank for Industry and Trade, Saigon South Branch, including Trademark (TH); Infrastructure (CSVC); Product and service quality (SPCL); Deposit interest rate (LS); Banker (NV); and Legal regulations (QDPL) through a multiple regression model and a series of tests to validate the appropriateness of the research results

Thirdly, based on the research findings, a series of managerial implications related to the influencing factors were presented to help the bank attract more customers to deposit savings and increase its capital mobilization channels Additionally, the study outlined its limitations and suggested directions for further research

3 Keywords:

Savings deposit, service quality, bank brand, bank interest rate

DISCLOSURE

I hereby declare that the thesis "Factors affecting individual customers' decision to deposit savings at Vietnam Joint Stock Commercial Bank for Industry and Trade - Saigon South Branch" is the author's research work, and

the research results received are truthful The information, data, and content cited are collected by the author from many different sources, have high reliability, and are cited in the reference section

Ho Chi Minh City, 2024 Author

Tran Thao Duyen

THANK YOU

First of all, with deep sincere gratitude, I would like to thank the teachers who are lecturers at the Ho Chi Minh City University of Banking, and the school's management board for creating favorable conditions for teaching and guiding me a lot of knowledge about the banking industry, teaching both soft skills and ethical training during my study here

I would like to express my deep gratitude to the person who guided me in the process of completing my thesis – Associate professor PhD Le Dinh Hac who oriented,

guided, supported, and encouraged me throughout the process of completing my research thesis

Finally, I would like to express my gratitude to my family and friends around me for helping me, sharing my experiences, and encouraging me when I faced difficulties in completing my essay

Ho Chi Minh City, 2024 Author

Tran Thao Duyen

CHAPTER 1 INTRODUCTION TO THE RESEARCH TOPIC 1

1.1 Reasons for choosing the topic 1

1.2 Significance of the research topic 2

1.3 Research objectives 3

1.3.1 General objective 3

1.3.2 Specific objective 3

1.4 Research question 3

1.5 Subject and scope of the study 4

1.5.1 Subject of the study 4

1.5.2 Scope of the study 4

1.6 Contribution: 4

1.7 Research method 4

1.8 Structure of reseach 5

CONCLUSION CHAPTER 1 7

CHAPTER 2: LITERATURE REVIEW 8

2.1 Basic concept overview 8

2.1.1 Raising captital 8

2.1.2 Savings deposits 9

2.1.2.1 Characteristics of savings deposits 9

2.1.2.2 The role of savings deposits 12

2.2 Consumer Behavior Theory 13

2.2.1 Concept of Consumer Behavior 13

2.2.2 Customer Banking Purchase Process Model 14 2.3 Factors Affecting Individual Customers' Savings Deposit Decisions at

Vietinbank – Saigon South Branch 17

2.3.1 Subjective factors 17

2.3.2 Macroeconomic factors 23

2.4 An overview of previous studies 24

2.4.1 Review of domestic research 24

2.4.2 Review of foreign research 27

3.1.2.1 Sample selection method 43

3.1.2.2 Data Processing Method 45

3.2 Building scales for factors in the model 48

CONCLUSION CHAPTER 3 51

CHAPTER 4: RESEARCH RESULTS AND DISCUSSION 52

4.1 Analysis of the influence level of factors on customers' decision to deposit savings at Vietinbank - Saigon South Branch: 52

4.1.1 Surey results: 52

4.1.2 Assessing reliability through Cronbach’s Alpha coefficient 54

4.1.3 Exploratory Factor Analysis (EFA) on the factors influencing the decision to deposit savings of individual customers at Vietinbank – Saigon South Branch: 57

4.1.4 Regression Analysis 62

4.2 Discussion and Statistical Hypothesis Testing 70

4.3 Evaluation of the Current Situation of Savings Mobilization Activities at Vietinbank – Saigon South Branch 72

5.1 Conclusion: 78

5.2 Recommendation 78

5.2.1 Deposit interest rates: 78

5.2.2 Legal regulations of the banking system: 80

5.2.3 Trademark 80

5.2.4 Infrastructure: 82

5.2.5 Banker 83

5.2.6 Product and quality of customer service 84

5.3 Limitations and further research directions 85

5.4 Future Research Directions 85

CONCLUSION CHAPTER 5 87

LIST OF ACRONYMS

Social Sciences

LIST OF TABLES

Table 2.1: The Characteristics of Different Types of Deposits 9

Table 2.2: The role of savings deposits 12

Table 2.3: Comparison of VND deposit interest rates for individual customers at Vietinbank with other commercial banks in March 2024 23

Table 2.4: Summary table of studies 29

Table 2.5: Summary table of factors included into the model 38

Table 3.1: Scale of components 48

Table 4.1: Descriptive Statistics of the Research Sample by Categories 52

Table 4.2: Summary of Cronbach’s Alpha testing results 55

Table 4.3: The results of EFA for the measurement concepts run the first time 58

Table 4.4: The results of EFA for the measurement concepts run the second time 60 Table 4.5: Test the results of EFA and Bartlett 61

Table 4.6: The test assesses the extent to which the observed variables explain the representative factors 62

Table 4.7: Correlation matrix of factors 63

Table 4.8: Model Summary 64

Table 4.9: The estimated results of the regression model 65

Table 4 10: Variance Analysis Results 66

Table 4 11: The summarized results of hypothesis testing 72

LIST OF FIGURES

Figure 2.1: Customer Banking Purchase Process Model 14

Figure 2.2: The process of selection, utilization, evaluation of banking services 15

Figure 2.3: Proposed model 35

Figure 3.1: Research process diagram 41

Figure 4.1: Normalized Residuals Frequency Graph 67

Figure 4.2: Normal P-P Plot of Residuals 68

Figure 4.3: Scatter Plot 69

CHAPTER 1 INTRODUCTION TO THE RESEARCH TOPIC 1.1 Reasons for choosing the topic

In recent years, the economy has been growing rapidly, offering numerous opportunities for domestic integration and socio-economic development However, the impact of the changes in the growth rate of the economy have led to various negative consequences, particularly affecting the Financial - Banking sector worldwide, with Vietnam being no exception One of the most pressing issues is mobilizing capital from individual customers for Commercial Banks in Vietnam, which is facing certain difficulties Therefore, mobilizing capital from this customer group has become a challenging task for all Commercial Banks in Vietnam today Capital mobilization is a fundamental activity of banks and a prerequisite resource for banks to carry out other business activities To obtain this capital, banks need to engage in capital mobilization activities, with savings deposit mobilization playing a particularly important role However, the mobilization of savings deposits by banks is currently facing many difficulties, such as fierce competition from other entities in the economy also engaging in savings deposit mobilization activities Furthermore, commercial banks themselves face certain limitations due to technological improvements, investment in technology to create convenience for customers, and having well-trained personnel with good skills and attentive service attitudes, which have somewhat affected their ability to attract capital (Doãn Thu Hà, 2016; Trinh Thế Cường, 2018) Therefore, understanding the factors influencing the mobilization of savings deposits is always a challenge for commercial banks

Therefore, to improve operational efficiency, enhance competitiveness, and ensure a healthy financial situation, researching, analyzing, and evaluating the factors influencing customers' decisions to deposit savings is extremely necessary From there, proposing solutions to enhance capital mobilization through savings deposits at commercial banks is a practical issue of significance There are quite a few research works both domestically and internationally related to these factors, such as:

Margaretha Sartien K.*, Yefta Sanam, Ronald E Renoat (2021), Getaneh Yenealem Ayene, (2020), Đào Lê Kiều Oanh, Đỗ Thúy Quỳnh (2023), etc However, studies conducted during the period 2023 - 2024 and related to the impact of the COVID-19 pandemic are quite limited It can be argued that up to now, there has been no related research conducted at Vietnam Joint Stock Commercial Bank for Industry and Trade - Saigon South Branch to assess the factors influencing customers' decisions to deposit savings

Based on these observations, the author has chosen the research topic: “FACTORS AFFECTING INDIVIDUAL CUSTOMERS' DECISION TO DEPOSIT SAVINGS AT VIETNAM JOINT STOCK COMMERCIAL BANK FOR INDUSTRY AND TRADE - SAIGON SOUTH BRANCH" to provide managerial implications for managers at Vietnam Joint Stock Commercial Bank for Industry and Trade - Saigon South Branch to increase capital from savings deposits and enhance the efficiency of

capital mobilization for Vietinbank – Saigon South Branch 1.2 Significance of the research topic

Vietinbank is one of the four largest state-owned commercial banks in Vietnam (Vietnamese Law Library (n.d.) Top 4 largest state-owned commercial banks in Vietnam) Vietinbank has continuously leveraged its strengths in the currency business sector while effectively implementing its business strategies However, with increasing competition in recent times, mobilizing capital through deposits is no longer an easy task for the bank

Currently, the competitive landscape for Vietinbank - Saigon South Branch is becoming more intense, ranging from competition in loan products and services to competition in deposit mobilization Additionally, in this area, there are numerous credit institutions, specifically 25-30 organizations according to information from the State Bank of Vietnam, including joint-stock commercial banks, joint-venture banks, financial companies, people's credit funds, competing with each other and continually expanding their networks, developing services, and improving product quality to

attract more customers

To achieve successful and sustainable growth in today's competitive environment, Vietinbank - Saigon South Branch needs to study the factors influencing customers' decisions to choose a bank to deposit savings This will help the bank develop capital mobilization strategies, focus on essential issues, and proactively attract potential customers

1.3 Research objectives 1.3.1 General objective

The research objective of the project is to identify and quantify the factors influencing individual customers' decisions to deposit savings at the Joint Stock Commercial Bank for Foreign Trade of Vietnam (VietinBank) - Saigon South Branch Subsequently, the study proposes management implications aimed at enhancing the effectiveness of mobilizing funds from individual customers at VietinBank - Saigon South Branch

1.3.2 Specific objective

The study aims to address the following specific objectives:

• Identify and quantify the impact of factors influencing customers' decisions to deposit money at VietinBank - Saigon South Branch

• Propose management implications to enhance the effectiveness of fund mobilization, and policies to attract depositors at VietinBank - Saigon South Branch, with the goal of improving the efficiency of mobilizing funds from individual customers at VietinBank - Saigon South Branch

factors?

• What are the key policy implications proposed to attract individual depositors, contributing to enhancing the efficiency of fund mobilization from individual customers at VietinBank - Saigon South Branch?

1.5 Subject and scope of the study 1.5.1 Subject of the study

The research focuses on "The factors affecting individual customers' decisions to deposit money at VietinBank - Saigon South Branch.”

Survey Subjects: Individual customers who currently have or have had savings deposits at VietinBank - Saigon South Branch

1.5.2 Scope of the study

Scope of space research: The Saigon South Branch of VietinBank, a joint-stock commercial bank, located in Ho Chi Minh City

Scope of time research: The study was conducted based on data collected in the period from January 2024 to March 2024

1.6 Contribution:

This study has identified and evaluated the impact of various factors influencing the decision of individual customers to deposit savings The research results have revealed the factors influencing the current situation at the Saigon South Branch of VietinBank Based on the reality and research findings of these influencing factors, the author proposes managerial implications to develop plans and strategies to attract and retain customers depositing savings at the Saigon South Branch of VietinBank

the banking and technology fields From these interactions, the author adjusted and supplemented the observed variables used to measure the research concepts, aiming to refine the construction of the survey questionnaire

Quantitative method: Analyzing data collected from formal surveys of individual

customers depositing savings at VietinBank - Saigon South Branch and processing the data using SPSS 22.0 software Specifically:

• Preliminary evaluation of the measurement scale and reliability of the measurement variables using Cronbach's Alpha coefficient and factor loading • Conducting Exploratory Factor Analysis (EFA) to identify factors representing observed variables influencing the decision of individual customers to deposit savings at VietinBank - Saigon South Branch

• Employing regression analysis techniques to test research hypotheses regarding the influence of factors affecting the decision of individual customers to deposit savings at VietinBank - Saigon South Branch

1.8 Structure of reseach

Chapter 1: Introduction to the research topic

This chapter provides an overview of the research paper, covering the following contents: reasons for selecting the topic; research problem; objectives of the study; research questions; object and scope of the study; significance of the research; and structure of the research paper

Chapter 2: Literature review

In this chapter, the author will begin by presenting the theoretical foundation regarding capital mobilization and savings deposits, followed by an exploration of factors influencing this decision Finally, the author will summarize models from previous studies related to this topic

Chapter 3: Research model and methodology

This chapter will present the specific research process, from preliminary (qualitative)

to formal (quantitative) research, summarize the research model, and present the research methodology, including sample selection and the development of a factor scale

Chapter 4: Research results and discussion

This chapter will present the results of data analysis following data collection Analysis steps include characterization of the study sample, scale verification using the Cronbach's Alpha coefficient method and Exploratory Factor Analysis (EFA), validation and presentation of test results of the study model and research hypotheses using regression analysis methods The aforementioned testing methods will be carried out using SPSS software

Chapter 5: Conclusions and recommendations

Building upon the research findings presented in Chapter 4, Chapter 5 will reevaluate these results, provide insights into any encountered limitations during the study, and ultimately offer recommendations to enhance capital mobilization capabilities

CONCLUSION CHAPTER 1

In chapter 1, the author introduces an overview of the selected topic and presents issues surrounding the research topic, including the reasons for choosing the subject, research objectives, research questions for the case, The object and scope of the research, the structure of the topic and the contributions of the research topic

CHAPTER 2: LITERATURE REVIEW 2.1 Basic concept overview

2.1.1 Raising captital

Capital mobilization activities are crucial for commercial banks, involving the acquisition and management of funds from customers through various deposit schemes The existence of all commercial banks heavily relies on capital mobilization since it is a primary activity for them (S.B Adem, 2015)

According to Trinh Thế Cường (2018), the concept of capital mobilization can be approached from different perspectives From a management standpoint, it entails planning, organizing, directing, and controlling contractual activities to achieve set goals From an operational perspective, it involves applying various methods and tools to execute monetary contracts within the economy In a broader sense, capital mobilization by commercial banks involves planning, selecting methods, and utilizing various tools to concentrate monetary resources within the economy, as well as organizing, directing, and controlling capital mobilization activities to achieve predetermined goals

According to Article 13 of the Law on Credit Institutions 2010, capital mobilization, also referred to as deposit-taking activities, is defined as follows: "Receipt of deposits is the activity of receiving funds from organizations, individuals in the form of demand deposits, time deposits, savings deposits, issuance of deposit certificates, bills of exchange, promissory notes, and other forms of deposit-taking according to the principle of full repayment of principal and interest to depositors as agreed." Thus, contractual activities at commercial banks involve receiving funds from organizations, individuals in various forms such as demand deposits, time deposits, savings deposits, issuance of deposit certificates, bills of exchange, promissory notes, and other forms, with the principle of full repayment of principal and interest to depositors as agreed

It is evident from the above that the importance of this source of capital is paramount Therefore, commercial banks need to formulate competitive capital mobilization policies to attract idle funds within the economy Banks need to adhere to basic principles in capital mobilization activities to promote capital growth and utilize funds most effectively

2.1.2 Savings deposits

According to Phan Thi Thu Ha (2013), savings deposits are generally considered a type of bank deposit Depositors have various reasons and needs when depositing money into banks In terms of purpose, bank deposits can be categorized into two types: transactional deposits and savings deposits As for the purpose of consumers, savings deposits are primarily intended for saving This means that this is a certain amount of money set aside for savings or investment, rather than for spending or personal payments Depositors typically expect to earn a return from these savings deposits

2.1.2.1 Characteristics of savings deposits

According to Ngô Diệu Thúy (2022) each with its own characteristics

Table 2.1: The Characteristics of Different Types of Deposits

Term Savings Deposits

Non-Fixed-Customers deposit savings without

specifying a fixed term

✓ Interest Rate: Typically low and calculated based on the end-of-day balance

✓ Deposit Term: No fixed term specified

✓ Interest Payment Method: Interest can be paid periodically or upon withdrawal

✓ Early Withdrawal: Customers can

withdraw funds at any time ✓ Minimum Deposit Amount:

Customers deposit savings with specified terms

✓ Interest Rate: Generally higher than non-fixed-term deposits ✓ Deposit Term: Flexible, ranging

from weeks to years

✓ Interest Payment Method: Interest can be paid upfront, periodically, or at maturity

✓ Early Withdrawal: Customers can still terminate the deposit early and receive non-fixed-term interest rates

✓ Minimum Deposit Amount: Typically 1,000,000 VND

✓ Value of Passbook: The passbook holds value as collateral

Tiered Savings Deposits

Depositors enjoy

progressively increasing interest rates based on deposit amounts determined by each bank

✓ Competitive Interest Rate: Rates vary based on the deposit term and amount

✓ Flexible Withdrawals: Depositors can withdraw funds according to their needs without time

constraints

✓ Convenient Procedures: Various deposit and withdrawal methods available

✓ Interest Payment Period: Interest can be paid per period or at the end, as requested by customers ✓ Applicable Currency: VND

Accumulative Savings

Depositors make regular monthly deposits and earn interest according to the bank's specified terms

✓ Competitive Interest Rate: Each bank sets its own competitive interest rate for this type of savings

✓ Minimum Deposit Amount: Typically 100,000 VND per deposit

✓ Flexible Deposit Methods: Cash deposits, electronic transfers, ATM deposits, and automatic deductions from payment accounts are available ✓ Can be Used as Collateral:

Deposits can be used as collateral for bank loans

Floating Interest Rate Savings

This type of fixed-term savings offers interest rates that fluctuate based on market trends or the central bank's basic interest rate

✓ Interest Adjustment: If market rates rise, depositors' interest rates increase accordingly Conversely, if rates decrease, the bank will maintain a basic interest rate to ensure depositors are not significantly disadvantaged

✓ Flexible Deposit Methods: Deposits can be made directly at bank branches or online if the bank supports online savings accounts

✓ Interest Payment Period:

Depositors can choose to receive interest monthly, quarterly, or annually according to their preferences

✓ Safety Measures: Many banks offer deposit insurance services for customer security

Source: Author's own compilation

2.1.2.2 The role of savings deposits

Table 2.2: The role of savings deposits

For customers For bank For the economy

✓ It serves as a safe investment channel for customers In addition to enhancing the personal financial value of customers, savings deposits through the banking system always enjoy a certain level of insurance, providing safety and peace of mind for customers

✓ It mobilizes idle funds from society to aggregate into a large capital source to serve the bank's business activities ✓ Savings deposits

help the bank increase liquidity and effectively manage capital ✓ They diversify the

✓ Savings deposits provide a source of capital input while also being available for capital output to contribute to the economic development

✓ The banking system allocates mobilized capital through important investment projects of the country, government bond investments, and other

✓ It helps customers easily access other banking services, such as loans Customers can use their deposits as collateral to receive better interest rates

capital sources, helping the bank minimize financial risks

contributing to the development of Vietnam's economy

✓ They establish a safe legal framework for the economy

Source: Author's own compilation

2.2 Consumer Behavior Theory 2.2.1 Concept of Consumer Behavior

There are various definitions of consumer behavior After researching the literature, the author has synthesized the common knowledge about consumer behavior as follows:

According to Micheal (2006): "Consumer behavior is a process that allows an individual or a group of people to select, purchase, use, or dispose of a product/service, based on their accumulated or experiential thoughts, to satisfy their needs or desires." Wayne et al (2013) state: "Consumer behavior is understood as a series of decisions about what to buy, why, when, how, where, how much, and how often Thus, each individual or group of consumers must make decisions over time about choosing to use products, services, ideas, or activities." According to Kardes et al (2002): "Consumer behavior is the study of human reactions to products and services, as well as marketing approaches to products and services." Schiffman et al (2002) suggest: "Consumer behavior encompasses the actions consumers take in research, purchase, usage, and evaluation of products and services, as well as the opinions they expect will satisfy their needs." James et al (2005) argue: "Consumer behavior is all activities directly related to the process of searching, collecting, purchasing, owning, using, and disposing of products/services It includes decision-making processes that occur before, during, and after those actions"

2.2.2 Customer Banking Purchase Process Model

The purchase decision process is a series of stages that consumers go through in deciding to purchase a product or service, as researched by various authors such as Philip Kotler, Solomon Michael, Trịnh Quốc Trung, etc Two purchase decision process models have been proposed:

Figure 2.1: Customer Banking Purchase Process Model

Source: Philip Kotler, 2004, Basic Marketing

Figure 2.2: The process of selection, utilization, evaluation of banking services

Source: Tran Hoang Mai, Nguyen Van Sau, Trinh Quoc Trung, 2008

• Selection:

When customers have a need for banking transactions, after expressing that need, they will receive advice from relatives, friends, etc., on choosing a bank to deposit their savings After selecting a bank they trust, customers will approach the bank's deposit process and go through the steps in that process

• Satisfaction:

Customer satisfaction is based on their subjective evaluations or judgments formed from their understanding of a product or service It is a psychological feeling after the customer's needs are met Customer satisfaction is built on accumulated experiences, especially during shopping and using products or services After purchasing and using a product, customers will compare reality with expectations to assess whether they are satisfied or dissatisfied

Perceiving needsSearching for informationEvaluating service providers

Requesting services from chosen providerService deliveryEvaluating service results

Future planning

Pre-purchase stage

Service implementation stage

Post-purchase stage

• Service quality:

Service quality is the bank's capacity, supplied and manifested through the level of satisfaction with the needs and desires of the target customers The quality of banking services is perceived by customers rather than determined by the bank The quality of banking services reflects their suitability with the needs and desires of the target customers

Customer Banking Process

When customers have a need for banking transactions, they will go through a buying process aimed at a specific product For banking products, there is a specific buying process with the following stages:

• "Perceived need" stage:

When customers have some spare money, they stand before the choice of ensuring the safety of their money, avoiding risks, earning interest, and facilitating shopping or business activities Psychological factors, changes in financial situations, and external stimuli significantly influence customers' decisions

• "Information search" stage:

When customers have a need for a product, they often seek a large amount of information because they are concerned about the risks and benefits The information they search for includes personal sources, online sources, public information, and their own experiences Personal and experiential sources are more reliable and significantly influence customers Therefore, banks need to focus on these sources In addition, information from advertisements and bank branding is also of interest to customers and is easily found in today's technological age."Evaluation and selection" stage:

After identifying the need for a product, customers will evaluate the product based on their perceptions and basic selection criteria Key factors include product attributes, brand, and expected attributes Product selection is heavily influenced by

customer trust and their expectations • "Purchase" stage:

The purchase of banking services can also change from the initial decision depending on the opinions of others and situational factors After careful consideration, customers make the decision to purchase the product

• "Post-purchase" stage:

After purchase, customers will question whether their purchase decision was correct, feel satisfied or dissatisfied with the banking service, and provide evaluations of the banking service They will assess whether their initial expectations were met and whether they will continue to use the service in the future Banking services are sensitive and entail various risks, so customers tend to choose banks that they believe meet their expectations

2.3 Factors Affecting Individual Customers' Savings Deposit Decisions at Vietinbank – Saigon South Branch

2.3.1 Subjective factors

• Brand and Reputation of the Bank

Commercial banks are known for their backbone activities of borrowing and lending This implies that a commercial bank can only operate if customers trust in depositing their money with the bank and establishing transactional relationships, as mentioned by Dao Hong Ngoc (2016) A good bank brand signifies trustworthiness, which customers rely on Building a good brand doesn't happen overnight; commercial banks need time to establish it According to Ha Nam Khanh Giao and colleagues (2014), a brand is formed over time through experiences with various factors such as product quality, services, financial capacity, etc., that the commercial bank promises to the market Therefore, commercial banks need to focus on building their own brand, apart from asserting their position and credibility in the market It's essential to establish a vision, mission, goals, and a unified brand identity system for the bank,

branch, develop brand management regulations, and establish a graphic department for communication and brand identity content

Vietinbank's brand is positioned as a leading entity in the Vietnamese banking system, with the largest capital and total assets, commanding a large market share and maintaining stability Over its more than 35 years of operation and development, Vietinbank has increasingly asserted its brand strength through continuous appearances in international rankings, affirming its position in Vietnam and readiness for international integration Specifically, in 2015, Vietinbank was ranked first in the banking sector in Vietnam in terms of brand and among the top 500 largest brands globally; top 2000 largest companies ranked by Forbes according to VietinBank (2015) Awards On May 3, 2017, Vietinbank launched a new brand identity Furthermore, VietinBank was honored to receive the "Outstanding Retail Bank 2021" award for the second consecutive time according to VietinBank's sources (2017) Awards In 2022, credit rating organizations Moody's and Fitch Ratings continued to upgrade VietinBank's credit ratings VietinBank's credit rating was upgraded by Fitch Ratings from BB- to BB with a positive outlook; Moody's upgraded VietinBank's credit rating by one notch from B2 to B1 with a "Stable" outlook These positive evaluations have enhanced the bank's position and credibility, supporting VietinBank's access to capital from credit institutions both domestically and internationally in the future In 2022, VietinBank was once again honored by The Asian Banker as the Best SME Bank in Vietnam according to VietinBank's sources (2022) Awards In 2023, for the eighth consecutive year, VietinBank was recognized by Global Banking & Finance Review magazine as the "Best Retail Bank in Vietnam" according to VietinBank's sources (2023) Awards VietinBank is one of the most modern and efficiently operating banks in Vietnam, catering to various customer segments, especially SMEs Vietinbank aims to increase its brand value from being a bank with strengths in the corporate customer segment to becoming a leading bank in both corporate and retail segments, a development focusing on payment services As a branch under the Vietinbank system, Vietinbank - Saigon South Branch not only

inherits brand values but also creates its own brand values in Ho Chi Minh City during its operation Vietinbank - Saigon South Branch also plans to organize activities and maintain promotional communication activities for its brand, products, and services Specifically, activities include promoting card and payroll payment services at administrative agencies, enterprises, and distributing leaflets for deposit promotion programs by region However, these activities are not regularly and diversely organized; the scale is small, usually organized at customer service branches or retail departments, hence the effectiveness achieved is not as expected (Source: Vietinbank - Saigon South Branch internal report)

• Employees of the Bank

Human resources are one of the decisive factors for a bank, as stated by Vu Van Thuc (2015), in determining the competitiveness of commercial banks in a market economy The quality of human resources is demonstrated by two main criteria: ethical qualities and managerial competence of both the management team and employees

To develop banking products in general and mobilize capital in particular, certain conditions regarding specialized and suitable human resources are required Competent human resources not only master the network and technology but also determine the improvement of networks, technologies, processes, etc Moreover, they play a crucial role in establishing and maintaining strong relationships with customers A commercial bank can only achieve sustainable development if it has a customer base that determines its competitiveness in the market economy The quality of human resources is demonstrated by two main criteria: ethical qualities and managerial competence of both the management team and employees

At Vietinbank - Saigon South Branch, the majority of employees in the business transaction department with customers are young and dynamic, aged between 22 and 30, Vietinbank's uniform is a blue shirt paired with trousers or a professional dress, presenting a professional image and creating a reliable impression on customers

However, the uniform design has not created a distinct image compared to other banks, failing to impress customers

As of January 31, 2024, the number of employees at Vietinbank - Saigon South Branch is 125, of which 95% have a university degree or above, and female employees account for a higher proportion, 57% of the total workforce This demonstrates that the branch has emphasized recruiting personnel with qualifications and expertise to perform their duties and serve customers better In terms of professional skills, employees are trained in corporate culture and labor regulations, professional work etiquette, customer interaction and behavior, and professional ethics when working in a risk-filled banking environment from the start of their employment Subsequently, they are trained in business process procedures with regular assessments During the work process, product training, supervision, and quality control training are often conducted by the human resources training institution for all branches of Vietinbank Additionally, Vietinbank - Saigon South Branch regularly organizes professional examinations, labor regulation checks, and compliance with Vietinbank's procedures and regulations periodically according to the internal comprehensive report of Vietinbank - Saigon South Branch

• Infrastructure:

Infrastructure consists of physical facilities and information technology systems that contribute to the efficient operation of a bank Modern, well-equipped, and clean physical infrastructure will create satisfaction and comfort for customers when they come to transact, and build an impressive image of a reputable brand for customers (Pham Minh Tuan, 2022) As a result, it creates a reliable foundation for the bank's depositors In the era of scientific and technological revolution, a bank with a vision and desire to create differentiation in competition with other banks will focus on developing its technology platform An updated, constantly improved, and secure information technology system will help minimize transaction time, enable fast and accurate transactions, streamline complex procedures, reduce operational risks, and

system operation (Pham Minh Tuan, 2022) Consequently, the bank saves resources and time, increases productivity, and enhances business efficiency The competitiveness of banks can be enhanced by applying technology with faster speed, higher security, cost savings, and improved operational efficiency (Vu Hong Thanh & Vu Duy Linh, 2016)

Vietinbank - Saigon South Branch has a total of 4 transaction offices located in convenient locations, situated on main roads, national highways in the area, close to markets, supermarkets, and densely populated residential areas This is an advantage for the bank in reaching customers Regarding the ATM system, Vietinbank has a large ATM network in the market with hundreds of ATMs Some areas with high transaction volumes such as District 7, District 1 have only 1 to 2 ATMs distributed, which is insufficient compared to customer demand For Internet banking channels, from 2015 to 2016, Vietinbank deployed and provided customers with many new high-tech service products, with many outstanding utilities such as SMS banking, internet banking including Vietinbank Ipay and Ipay mobile As of January 31, 2024, there were 75 businesses using Vietinbank Ipay service for business customers (Vietinbank eFAST) and 81,920 individual customers using Vietinbank Ipay service with utility services to serve

• Product and Service Quality and Customer Service in Banking:

One factor influencing the scale and quality of mobilized capital is the forms, terms, and related services provided (Wubitu, 2012) Additionally, other factors such as transaction time, procedures, and network systems, as well as the convenience of transaction points, also play a role Since customer needs vary, meeting these diverse needs contributes to enhancing the efficiency of capital mobilization activities (Wubitu, 2012) A bank with abundant and flexible deposit methods and terms, along with a wider network, will be more capable of attracting new customers and retaining existing ones compared to other banks It will also have better conditions for customer access and service, leading to lower costs and reduced capital mobilization expenses

Moreover, abundant capital mobilization methods are conditions for attracting diverse capital sources from various sources with different characteristics in terms of quantity, quality, and terms This helps banks use capital flexibly, safely, and efficiently (Luong Van Hai & Nguyen Thi Hong Lan, 2020)

The quality of customer service at Vietinbank - Saigon South Branch, such as consultation support, resolving bank-related queries and issues, also impacts capital mobilization Emphasizing after-sales activities contributes to creating a good impression with customers, maintaining the current deposit customer base, and promoting and attracting new customers in the fiercely competitive phase among commercial banks The transaction process at Vietinbank - Saigon South Branch is evaluated as simple and understandable; however, the processing speed of customer needs is still slower compared to some other banks

Vietinbank implements promotional programs and communication campaigns to enhance the brand image to attract deposits These promotions include recurring savings, savings with preferential interest rates, direct gift savings, prize draws with valuable prizes, customer red envelopes, product introductions at enterprises, agencies, etc However, the promotional programs at Vietinbank - Saigon South Branch are limited in quantity, focusing on the premium customer segment, with high promotional conditions, and customers may not fully benefit from all promotional programs Additionally, Vietinbank - Saigon South Branch also strives to carry out charitable and social welfare activities with a strong humanitarian spirit, such as building charity houses, distributing Tet gifts annually to the poor, awarding scholarships to students, and "Gratitude candlelight" to bring its brand closer to

customers

• Deposit interest rate:

The interest rates on deposit accounts offered by banks are based on the State Bank of Vietnam's interest rate regulations, market conditions, capital demand, and specific geographical areas

Table 2.3: Comparison of VND deposit interest rates for individual customers at Vietinbank with other commercial banks in March 2024

Bank 1 month 3 months 6 months 12 months 18 months

Overall, the interest rates on savings deposits for individual customers at Vietinbank - Saigon South Branch at the beginning of 2024 are not very competitive compared to other banks in the region Vietinbank's deposit interest rates are built to be low for short terms, while for longer terms, the interest rates increase gradually to attract stable capital sources Vietinbank's savings deposit interest rates are higher than those of Vietcombank and Agribank by 0,1% to 0,2% for various terms This is also advantageous for Vietinbank However, compared to Sacombank and Techcombank, Vietinbank's rates are generally lower by around 0,4% to 0,5% Despite competitive interest rates, Vietinbank still lacks specific interest rate policies for different customer segments or regions to attract more savings deposit customers

2.3.2 Macroeconomic factors • Economic Development:

If the economy is stable, with sustainable development and high per capita income, and the level of education is high, it will create favorable conditions for the operation and development of commercial banks (Getaneh Yenealem Ayene, 2020) This is because societal accumulation will be high, and confidence in the banking sector's

operations will increase As a result, it is essential to ensure that all economic components deposit funds into banks for specific purposes Conversely, if the social situation in an economic area is unstable, the economic development pace will be limited This leads to low societal savings, and besides the preference for cash, there is minimal genuine interest in the various services provided by banks Therefore, implementing capital mobilization policies by commercial banks faces many difficulties Moreover, the capital mobilization policies of commercial banks are also influenced by factors such as the money supply inflation rate Economic recession, and even the development of an "economic bubble" that is too hot (Getaneh Yenealem Ayene, 2020) These factors more or less affect the operations of commercial banks, some significantly, impacting the existence and development of banks

• Legal Regulations:

In every country worldwide, all activities of commercial banks, including capital mobilization, are regulated by laws and supervised and managed by the central bank to serve the purposes set by the Government or the State (Meskerem Ayele, 2024) Commercial banks, when necessary, need to purchase government bonds issued by the Government (representing the State Treasury) according to specific regulations of the central bank With the goal of ensuring the monetary security of each country, the central bank has stipulated the maximum capital amount allowed to be mobilized at 1 billion VND at a specific ratio compared to the commercial bank's own capital Additionally, the operations of the commercial banking system are also regulated by many other agencies and laws, depending on the degree of relationships in business activities

2.4 An overview of previous studies 2.4.1 Review of domestic research

According to Le Duc Thuy and Pham Thu Hang (2017), in the current context of fierce competition, managing and developing capital funds plays a crucial role For commercial banks, effectively attracting and managing capital funds from enterprises

always plays an important role Based on the analysis of a sample of 272 enterprises through surveys at banks in Hanoi, the research results have identified factors influencing the quality of deposit services into commercial banks by enterprises, including: (1) Financial benefits; (2) Products; (3) Quality of customer service; (4) Transaction convenience; (5) Bank image; (6) Deposit safety Among these, the factor of Deposit safety has the strongest impact on the deposit decisions of enterprises in Hanoi

Le Thi Vien (2018) conducted research on the factors influencing capital mobilization, analyzing and evaluating the current situation, and proposing specific solutions and implementation plans to enhance the influence of positive factors to improve capital mobilization activities at Vietinbank Phu Yen The results of quantitative analysis and situational analysis at Vietinbank Phu Yen have shown that the factors positively affecting deposit mobilization activities at Vietinbank Phu Yen, in decreasing order, are: employees, economic development factors, operational network, infrastructure and information technology system, brand, deposit interest rates, and promotions Economic development factors and bank staff significantly impact deposit mobilization activities at Vietinbank Phu Yen, while deposit products and customer factors have less impact Proposed solutions target these factors and their appropriate levels of impact to provide efficiency and avoid wasting resources on factors that have little or no impact on deposit mobilization

Tran Thi Viet Hang (2019) analyzed and evaluated the situation of capital mobilization at the Vietnam Bank for Agriculture and Rural Development - Quang Binh Branch The results showed that the capital mobilization situation mainly consists of traditional mobilization products, where customers' purpose is to earn interest rates The bank's brand and reputation are among the decisive factors for capital mobilization into the bank However, the author's research only provided basic information about capital mobilization, its characteristics, and the role of capital mobilization without studying the target of capital mobilization at the bank

In a study on the impact of factors influencing individual customers' savings decisions, Ha Nam Khanh Giao et al (2020) conducted an experimental study on a sample of 1,500 individuals at Vietnamese commercial banks They focused on aspects such as bank brand, savings interest rates, convenience, service quality, and promotional policies The research provided a detailed and comprehensive perspective, using this model as a basis for personal views, specific economic conditions in Vietnam, and the operations of commercial banks

According to Quan Minh Nhut and Diep My Thu (2022), with the topic "Factors influencing individual customers' savings decisions at the Vietnam Import Export Commercial Joint Stock Bank - Can Tho Branch - Cai Rang Transaction Office," the group of authors based on qualitative and quantitative research, constructed a research model comprising 7 factors with 155 research samples: Reputation and brand, Financial benefits, Convenience, Marketing methods, Influence from relationships, Service diversity, Staff team The final results showed that 05 factors influence individual customers' savings decisions at Eximbank Cai Rang, including: Marketing methods, Convenience, Financial benefits, Influence from relationships, Reputation and brand

Nguyen Thi Thu Thao (2023) conducted a study titled "Solutions to enhance the efficiency of capital mobilization at the Vietnam Bank for Agriculture and Rural Development - Vinh Long Branch." Through this study, the author analyzed and evaluated the capital mobilization situation at the Vietnam Bank for Agriculture and Rural Development - Vinh Long Branch from 2017 to 2021 The author used both qualitative and quantitative methods with 130 observed variables and proposed 4 factors: Deposit products, Interest rates, Brand, Services The author proposed solutions to enhance the efficiency of capital mobilization at the Vietnam Bank for Agriculture and Rural Development - Vinh Long Branch, including improving service quality, the bank's policies, strengthening marketing activities, and applying technology in developing bank products and services

Dao Le Kieu Oanh and Do Thuy Quynh (2023), in their study "Factors influencing savings decisions of enterprises at the Joint Stock Commercial Bank for Investment and Development of Vietnam - Vung Tau Branch - Con Dao," conducted a thesis with the goal of systematizing theoretical basis, research direction, theoretical framework, and expert method, carried out with a sample size N = 15 Applying quantitative methods, through structured interview questionnaires, complex closed questions, using Likert scales, the study targeted enterprises depositing savings with a sample size N = 250, The research results identified 06 factors positively influencing the savings decisions of enterprises at BIDV Vung Tau - Con Dao, ranked in decreasing order: "Financial benefits of deposits," "Deposit safety," "Savings deposit services," "Bank staff," "Influence of acquaintances," and "Brand reputation." Among these, the factor with the greatest influence is "Financial benefits of deposits," while the factor with the lowest influence is "Brand reputation."

In conclusion, studies on customer choices and behaviors regarding commercial banks have clarified the important factors influencing customer decisions Among these, bank reputation, service range, and convenience have been identified as crucial factors when customers choose banks to transact with In particular, research has shown that customers care about the quality of bank services and customer service attitude, as well as the level of convenience and flexibility in transactions

2.4.2 Review of foreign research

In the study conducted by Lakstutiene and Naraskeviciute (2012) on bank selection motives, the author performed quantitative analysis using a system of documentation, comparative analysis, and deductive logic based on data collected from 328 individual customers The research results showed that customers are typically concerned about the bank's reputation, deposit rates, service range, and convenience when choosing a bank The study also identified key factors causing dissatisfaction among customers, including high fees, large fee amounts, high loan interest rates, low deposit interest rates, and system errors or malfunctions in E-banking

Tehulu and Wondmagegna (2014) investigated the perception of Ethiopian people regarding bank selection decisions using a Binary Logistic model with data collected from a survey of 204 customers from 5 commercial banks in Bahir Dar city The study revealed factors influencing customers' bank selection decisions, including personal factors, bank technology, service quality, bank brand image, convenience, and marketing

Far and Zadeh (2016) studied the factors influencing capital mobilization at Maskan Bank in Iran in 2016 The research showed that there are 06 factors influencing the success of capital mobilization at this bank: information technology, human resource skills, product and service diversification, customer satisfaction, network utility, and branch convenience

Getaneh Yenealem Ayene (2020) aimed to identify the determinants of deposit mobilization in the case of Commercial Bank of Ethiopia Primary data was collected through the distribution of 238 valid questionnaires to selected customers of the bank, supplemented by secondary data to some extent Quantitative data analysis was processed using SPSS The study found that branch expansion, service diversification by the bank, customer information security, trust in the banking system, and savings habits were important variables influencing deposit mobilization Interest rates and inflation were also important macroeconomic factors affecting deposit mobilization Based on these findings, recommendations were forwarded

Hariyanto Hariyanto and Bariyyatin Nafi'ah (2022) investigated the impact of religion and service quality on the savings intention of Islamic banks for the Muslim community in East Java, Indonesia The study also aimed to explore whether gender, education level, Islamic education level, and geography influence the savings intention at Islamic banks This research used a positive approach and the Partial Least Squares Structural Equation Modeling (SEM-PLS) technique Convenience sampling was used, with a total of 100 respondents The results showed that religion does not influence the savings intention of the Muslim community, while service

quality significantly affects the savings intention of the Muslim community in East Java, Indonesia This indicates that the better the service quality of Islamic banks, the higher the intention of saving among the people Education and Islamic education levels influence the savings intention at Islamic banks, while gender and geography have no effect

Meskerem Ayele (2024) aimed to investigate the factors influencing bank selection by customers at the Bank of Abyssinia The study particularly examined the impact of service fees, initial deposit requirements, interest rates, E-banking, ATM services, branch quantity, capital safety, customer-based services, and loan provision on customers' bank selection A total of 367 out of 384 customers of Abyssinia Bank were used as the sample for this study The findings showed a positive correlation between service fees, interest rates, E-banking, ATM services, branch quantity, capital safety, customer-based services, loan provision, and customers' bank selection Moreover, the study concluded that service fees, interest rates, E-banking, capital safety, customer-based services, and loan provision are crucial determinants in customers' bank selection The study also found that ATM services and branch quantity have no statistically significant influence on customers' bank selection Overall, these studies have provided insights into customer decisions in bank selection and deposit mobilization Some challenges include high fees, high loan interest rates, low deposit interest rates, and system errors or malfunctions in E-banking, which can affect customer satisfaction and their decisions when choosing a bank

Table 2.4: Summary of studies

Author Research method Influencing factors and directions of influence Domestic research

Le Duc Thuy and Pham Qualitative & Quantitative Financial benefits (+);