Improving the financial appraisal of investment projects in BIDV giaiphong

NATIONAL ECONOMICS UNIVERSITY CENTRE FOR ADVANCED EDUCATIONAL PROGRAMS BACHELOR’ S THESIS Major: Finance TOPIC: Improving the financial appraisal of investment projects in BIDV Giai Phong DINH THI KIEU TRANG HANOI, 2016 NATIONAL ECONOMICS UNIVERSITY CENTER FOR ADVANCED EDUCATIONAL PROGRAMS  BACHELOR’ S THESIS TOPIC: Improving the financial appraisal of investment projects in BIDV Giai Phong Student Major Class Student’ s ID Supervisor : : : : : ĐINH THỊ KIỀU TRANG Finance Advanced Finance 54B 11124079 Prof TẠ VĂN LỢI, PhD Hanoi, 2016 ACKNOWLEDGEMENT First of all, I would hereby like to write for the people who strongly support me to complete my bachelor’s thesis I wish to express my profound sense of gratitude to Mr Ta Van Loi, my supervisor, for his enthusiastic guidance, useful advices and recommendations and great encouragement in carrying out this project work I would also like to thank Mrs Vu Thi Thu Ha, my internship guide, for giving me valuable experiences about banking and especially, investment appraisal, strong support me gather data as well as information that are necessary for my report My grateful thank are also due to the staffs at BIDV Giai Phong, and at Risk Management Department in particular, for their help and support during the time of my internship Table of Contents STATUTORY DECLARATION I herewith formally declare that I myself have written the submitted Barchelor’s Thesis independently I did not use any outside support except for the quoted literature and other sources mentioned at the end of this paper Hanoi, 02/06/2016 Signature ABBREVIATION BIDV: IP: IRR: NPV: DSCR: Bank for Investment and Development of Vietnam Investment project Internal rate of return Net present value Debt service coverage ratio LIST OF TABLES Table 1: Deposit and borrowing of BIDV Giai Phong 2012-2014) Table 2: The rate of return on assets (ROA) of BIDV Giai Phong 2012-Jun2015 Table 3: The rate of return on equity (ROE) of BIDV Giai Phong 2012-Jun2015 Table 4: Project loan in BIDV Giai Phong 2013-2015 (billion VND) Table 5: Revenue (Dai Huu Company) Table 6: Annual repayment schedule (Dai Huu Comepany) Table 7: Business Performance (Dai Huu Company) Table 8: Cash flow in the view of bank (Dai Huu Company) Table 9: Cash flow in the view of investor (Dai Huu Company) Table 10: The effectiveness of Nam Ha project LIST OF FIGURES Figure 1: BIDV organization structure Figure 2: Growth rate of mobilized capital of BIDV Giai Phong from 2012 to 6/2015 Figure 3: Mobilization interest rate on average of BIDV Giai Phong (2012-2014) Figure 4: Mobilization costs weighted average of BIDV Giai Phong (2012-2014) Figure 5: Mobilization from deposits of BIDV Giai Phong (2012-2015) Figure 6: Operating expenses of BIDV Giai Phong 2012-Jun2015 Figure 7: Profit margin of BIDV Giai Phong 2012-Jun2015 Executive Summary As we all know, banking system had played an integral role in promoting the stability and the development of the economy Especially, in order to contribute to cause of industrialization and modernization, the development bank is taken into account as an efficient supporter of the government to strengthen the economy and income of national citizens However, in recent years, the economic crisis in Vietnam has crept into every industry, including banking industry, especially commercial bank Meanwhile, the principal activities of commercial banks are take deposits and lend, while lending is the main activity that creates bank’s profits Therefore, in the process of approving the investment credit capital, how to operate efficiently and keep the loans safely are always the top priorities of banks Commercial banks have used a variety of different methods and measurements in order to estimate the projects are possible or not, manage the investment to minimize the risk and enhance the quality of financial appraisal Among those methods, BIDV considers the investment projects appraisal through calculation of how much the total investment capital, how long the loan maturity are, etc to make investment decisions and to guarantee the investment credit’s effectiveness Nevertheless, the financial appraisal system of BIDV has displayed some limitations which due to the wrong credit granting decisions and the inaccurate capital amount In fact, there are some projects are not able to pay the debt back to the Bank During the period of internship in BIDV Giai Phong, by my experimental working time and reference, I have understood this bank in both organizational structure and its business performance I also have a chance to look through the data of this bank to give the most retail and precise analysis For all the purposes above, I summit this report of this internship to analyze the investment project of BIDV Giai Phong, points out the drawbacks and recommendations the solution to enhance the project It met its aims through a study of basic relevant literature frameworks and a study of specific application at BIDV Giai Phong “Improving the financial appraisal of investment projects in BIDV Giai Phong” The thesis’s structure consists of seven main chapters including: Chapter 1: Introduction Chapter 2: Overview of BIDV Giai Phong Chapter 3: Theoretical framework Chapter 4: Current situation of financial appraisal of investment projects in BIDV Giai Phong Chapter 5: Solutions and recommendations Conclusion Because the time is limited and I have not very much practical knowledge, I look forward to receiving the help of supervisor to achieve better results I sincerely thank! CHAPTER 1: INTRODUCTION 1.1 Rationale After nearly 20 years of turning to the socialist-oriented market economy, Vietnam economy has made great achievements and encouraging, GDP growth took 7% per year The unemployment rate fell, meaning that the economy created more jobs Commodities are provided in full, varied and good quality Vietnam commercial banks systems played an important role in the developing of Vietnam economy As financial intermediary, Vietnam commercial banks systems are not only the most important factor of economic activities, but also mainstream funding for private and public projects In the implementation process of project financing, the most pivotal point that the banks in general and BIDV in particular concern about is the efficiency and safety of their investment Regard for commercial banks, project lending activities, which are the main income of commercial banks, always take high percentages in total loans However, these activities contain potential risks for banks, it leads to the needs for improving the quality of financial appraisal in lending activities, especially, improving the quality of financial appraisal of investment projects in commercial banks is necessary BIDV has used a variety of different methods to evaluate the feasibility of the projects, manage the investments to minimize the risk and improve the investment quality Nevertheless, the financial appraisal system of BIDV has displayed some limitations which due to the wrong credit granting decisions and the inaccurate capital amount In fact, there are some projects are not able to pay the debt back to the Bank Being aware of those limitations as well as the important of financial appraisal of investment projects to the investment credit’s quality which in turn decides the performance of BIDV, I decided to choose my final project topic is “Improving the financial appraisal of investment projects in BIDV Giai Phong” 1.2 Review of relative researches Financial management is significant concerned with financing, dividend and investment decisions of the firm with some overall goal in mind Corporate finance theory has developed around a goal of maximizing the market value of the firm to its shareholders This is also known as shareholder wealth maximization Although various objectives or goals are possible in the field of finance, the most widely accepted objective for the firm is to maximize the value of the firm to its owners Financing decisions deal with the firm's optimal capital structure in terms of debt and equity Dividend decisions relate to the form in which returns generated by the firm are passed on to equity-holders (DayanadaD, 2002) Investment decisions deal with the way funds raised in financial markets are employed in productive activities to achieve the firm's overall goal; in other words, how much should be invested and what assets should be invested in it is assumed that the objective of the investment or capital budgeting decision is to maximize the market value of the firm to its shareholders This self-explanatory helps the reader to easily visualize and retain a picture of the capital budgeting function within the broader perspective of corporate finance (Durand, 1981) Funds are invested in both short-term and long-term assets Capital budgeting is primarily concerned with sizable investments in long-term assets These assets may be tangible items such as property, plant or equipment or intangible ones such as new technology, patents or trademarks Investments in processes such as research, design, development and testing — through which new technology and new products are created — may also be viewed as investments in intangible assets Irrespective of whether the investments are in tangible or intangible assets, a capital investment project can be distinguished from recurrent expenditures by two features One is that such projects are significantly large The other is that they are generally long-lived projects with their benefits or cash flows spreading over many years Sizable, long-term investments in tangible or intangible assets have long-term consequences An investment today will determine the firm's strategic position many years hence (Gil, 1994) These investments also have a considerable impact on the organization's future cash flows and the risk associated with those cash flows Capital budgeting decisions thus have a long-range impact on the firm's performance and they are critical to the firm's success or failure As such, capital budgeting decisions have a major effect on the value of the firm and its shareholder wealth This review deals with capital budgeting decisions It focus on defining the shareholder wealth maximization goal, defines and distinguishes three types of investment project on the basis of how they influence the investment decision process, discusses the capital budgeting process and identifies one of the most crucial and complex stages in the process, namely, the financial appraisal of proposed investment projects This is also known as economic or financial analysis of the project or simply as `project analysis' This financial analysis is the focus of this review Actual project analysis in the real world involves voluminous, tedious, complex and repetitive calculations and relies heavily on computer spreadsheet packages to handle these evaluations (STAPLETON, 1971) 1.3 Research objectives 1.3.1 Research objectives The thesis is navigated to reach three main targets, including Firstly, to understand the historical background, organizational structure as well as business performance and financial condition of BIDV Giai Phong Secondly, to understand the content and procedure of investment project appraisal which is currently applied in BIDV Giai Phong, especially focusing on financial appraisal, by analyzing a typical investment project appraisal of the branch Thirdly, to evaluate the efficiency of financial appraisal of investment projects in the branch, which classifies its achievements and limitations as well in order to find out both implicit and explicit causes, then suggest proper solutions and recommendations to enhance its financial appraisal of investment projects in credit activity 1.3.2 Research question • How did the branch appraise its investment projects? 10 N Items o Year 10 Cash inflow 111,89 119,49 128,58 128,9 27 128,9 27 135,37 135,7 13 135,7 13 135,7 13 135,7 13 a Total revenue 115,356 122,14 128,92 128,9 27 128,9 27 135,71 135,7 13 135,7 13 135,7 13 135,7 13 b ∆AR = AR1 - AR2 (Change in account receivable ) (3,461) (2,646 ) - - (339) - - - - c Liquidation of fixed asset Cash outflow 50,20 106,64 110,87 117,11 117,0 44 117,0 97 124,21 124,1 96 124,3 01 124,4 06 124,5 11 a Initial investment 50,20 b Product expense 104,261 110,36 116,46 116,4 68 116,4 68 122,57 122,5 71 122,5 71 122,5 71 122,5 71 c ∆AP = AP1 - AP2 (Change in account payment ) (3,128) (183) (183) - - (183) - - - - 5,213 305 305 - - 305 - - - - d ∆CB = CB2 - CB1 (Change in cash 55 (339) balance) e Income tax Net cash flow [12] (50,2 00) NPV_TIP 6,945 IRR_TIP 15% 297 393 524 577 629 1,520 1,625 1,730 1,835 1,940 5,252 8,615 11,474 11,88 11,83 11,160 11,51 11,41 11,30 11,20 Table 9: Cash flow in the view of investor (Dai Huu Company) No Cash inflow Item Year 10 35,000 111,8 119,49 128,588 128,92 128,92 135,373 135,71 135,71 135,71 135,71 56 95 ∆AR = AR1 - AR2 (Change in account receivable ) c The value of assets of financial leasing 7 3 3 115,3 122,14 128,92 128,92 135,71 135,71 135,71 135,71 128,927 135,713 56 7 3 3 a Total revenue b (3,461 (2,646 (339) ) ) - - (339) - - - - 35,000 d Liquidation of fixed asset Cash outflow 50,200 a Initial investment 50,200 b Product expense 114,3 118,15 123,48 123,11 129,37 129,06 128,74 128,43 123,974 129,813 43 6 104,2 110,36 116,46 116,46 122,57 122,57 122,57 122,57 116,468 122,571 61 8 1 1 c ∆AP = AP1 - AP2 (Change in account payment ) (3,128 (183) ) (183) - - (183) - - - - d ∆CB = CB2 - CB1 (Change in cash balance) 5,213 305 305 - - 305 - - - - 7,700 7,280 6,860 5,600 5,180 4,760 4,340 3,920 1,520 1,625 1,730 1,835 1,940 5,560 6,337 6,652 6,967 7,282 Repayment of financial e leasing fee (principal + interest) f Income tax Net cash flow [1-2] 297 393 (15,200 (2,448 1,335 57 524 4,614 6,440 6,020 577 629 5,443 5,810 ) Debt service coverage ratio (DSCR) ) 1.32 DSCRAverage 1.88 NPV_EPV 3,456 IRR_EPV 19% 58 1.43 1.59 1.68 1.79 1.88 2.01 2.16 2.35 2.57 Table 10: The effectiveness of Nam Ha project I Investment scale Type of equipment: Bus with floors (46 seats) Volume: 04 items Price: 9,700,000,000 VND Equipment status: New 100% II Total investment ( unit: VND ) 9,942,500,000 VND Original price 9,700,000,000 VND Registration fee 242,500,000 VND II Target I Average ticket price 110,000 VND/person Number of trips 26 trips/month/bus Fuel norms 27 liters of oil/100km Average number of visitors 35 person/bus Driver salary 10,000,000 VND/bus/month Maintenance costs 10,000,000 VND/bus/month Travelling costs 22,000 VND/trip (route: Láng – Hoà Lạc) I V Funding plan Value Density % Equity 3,242,500,000 VND 32.6 Lending 6,700,000,000 VND 67.4 V Annual depreciation Straight line depreciation Year Rate 0.14 Year Amount 1,420,357,143 VND 59 Table 11: Economic efficiency of Nam Ha project Unit: VND 5.6.7 VI Total revenue Total revenue 4.804.800 4.804.800 4.804.800 4.804.800 4.804.800 000 000 000 000 000 Total expenses 4.748.923 4.585.365 4.465.309 4.299.709 4.134.109 893 393 143 143 143 Profit 55.876.10 219.434.6 07 339.490.8 57 505.090.8 57 670.690.8 57 VII Project expenses 4.748.923 4.585.365 4.465.309 4.299.709 4.134.109 60 893 393 143 143 143 Main raw material costs Diezel Oil 1.297.296 1.247.400 1.247.400 1.247.400 1.247.400 000 000 000 000 000 Direct salary 480.000.0 00 480.000.0 00 480.000.0 00 480.000.0 00 480.000.0 00 Driver salary 480.000.0 00 480.000.0 00 480.000.0 00 480.000.0 00 480.000.0 00 Depreciation costs 1.420.357 1.420.357 1.420.357 1.420.357 1.420.357 143 143 143 143 143 Travelling costs 27.456.00 27.456.00 27.456.00 27.456.00 27.456.00 Insurance costs 145.500.0 00 145.500.0 00 145.500.0 00 145.500.0 00 145.500.0 00 Interest expenses 658.218.7 50 544.556.2 50 424.500.0 00 258.900.0 00 93.300.00 Maintenance costs 480.000.0 00 480.000.0 00 480.000.0 00 480.000.0 00 480.000.0 00 Others 144.000.0 00 144.000.0 00 144.000.0 00 144.000.0 00 144.000.0 00 10 Payments for management 96.096.00 96.096.00 96.096.00 96.096.00 96.096.00 61 Table 12: Repayment schedule of Nam Ha project Starting Balance Original Payable Interest Payable Total June 6,700,000,0 00 58,625,000 58,625,000 July 6,700,000,0 00 58,625,000 58,625,000 Aug 6,700,000,0 117,000,00 00 58,625,000 175,625,000 Sep 6,583,000,0 117,000,00 00 57,601,250 174,601,250 Oct 6,466,000,0 117,000,00 00 56,577,500 173,577,500 Nov 6,349,000,0 117,000,00 00 55,553,750 172,553,750 Dec 6,232,000,0 117,000,00 00 54,530,000 171,530,000 200 400,137,50 867,887,500 6,115,000,0 117,000,00 00 53,506,250 170,506,250 Jan 62 Feb 5,998,000,0 117,000,00 00 52,482,500 169,482,500 Mar 5,881,000,0 117,000,00 00 51,458,750 168,458,750 Apr 5,764,000,0 117,000,00 00 50,435,000 167,435,000 May 5,647,000,0 117,000,00 00 49,411,250 166,411,250 June 5,530,000,0 117,000,00 00 48,387,500 Earning 165,387,500 July 5,413,000,0 117,000,00 00 47,363,750 164,363,750 Aug 5,296,000,0 117,000,00 00 46,340,000 163,340,000 Sep 5,179,000,0 117,000,00 00 45,316,250 162,316,250 Oct 5,062,000,0 117,000,00 00 44,292,500 161,292,500 Nov 4,945,000,0 117,000,00 00 43,268,750 160,268,750 Dec 4,828,000,0 117,000,00 00 42,245,000 159,245,000 201 574,507,50 1,978,507,5 00 Jan 4,711,000,0 117,000,00 00 47,110,000 164,110,000 Feb 4,594,000,0 117,000,00 00 45,940,000 162,940,000 Mar 4,477,000,0 117,000,00 00 44,770,000 161,770,000 Apr 4,360,000,0 117,000,00 43,600,000 160,600,000 63 657,431,25 00 May 4,243,000,0 117,000,00 00 42,430,000 159,430,000 June 4,126,000,0 117,000,00 00 41,260,000 Earning 158,260,000 July 4,009,000,0 117,000,00 00 40,090,000 157,090,000 Aug 3,892,000,0 117,000,00 00 38,920,000 155,920,000 Sep 3,775,000,0 117,000,00 00 37,750,000 154,750,000 Oct 3,658,000,0 117,000,00 00 36,580,000 153,580,000 Nov 3,541,000,0 117,000,00 00 35,410,000 152,410,000 Dec 3,424,000,0 117,000,00 00 34,240,000 151,240,000 201 488,100,00 1,892,100,0 00 Jan 3,307,000,0 117,000,00 00 33,070,000 150,070,000 Feb 3,190,000,0 117,000,00 00 31,900,000 148,900,000 Mar 3,073,000,0 117,000,00 00 30,730,000 147,730,000 Apr 2,956,000,0 117,000,00 00 29,560,000 146,560,000 May 2,839,000,0 117,000,00 00 28,390,000 145,390,000 June 2,722,000,0 117,000,00 00 27,220,000 Earning 144,220,000 64 541,063,75 417,900,00 July 2,605,000,0 117,000,00 00 26,050,000 143,050,000 Aug 2,488,000,0 117,000,00 00 24,880,000 141,880,000 Sep 2,371,000,0 117,000,00 00 23,710,000 140,710,000 Oct 2,254,000,0 117,000,00 00 22,540,000 139,540,000 Nov 2,137,000,0 117,000,00 00 21,370,000 138,370,000 Dec 2,020,000,0 117,000,00 00 20,200,000 137,200,000 201 319,620,00 0 1,723,620,0 00 Jan 1,903,000,0 117,000,00 00 19,030,000 136,030,000 Feb 1,786,000,0 117,000,00 00 17,860,000 134,860,000 Mar 1,669,000,0 117,000,00 00 16,690,000 133,690,000 Apr 1,552,000,0 117,000,00 00 15,520,000 132,520,000 May 1,435,000,0 115,000,00 00 14,350,000 129,350,000 June 1,320,000,0 115,000,00 00 13,200,000 Earning 128,200,000 July 1,205,000,0 115,000,00 00 12,050,000 127,050,000 Aug 1,090,000,0 115,000,00 00 10,900,000 125,900,000 Sep 975,000,000 115,000,00 124,750,000 9,750,000 65 249,420,00 0 Oct 115,000,00 860,000,000 8,600,000 123,600,000 Nov 115,000,00 745,000,000 7,450,000 122,450,000 Dec 115,000,00 630,000,000 6,300,000 121,300,000 151,700,00 151,700,000 Jan 115,000,00 515,000,000 5,150,000 120,150,000 Feb 115,000,00 400,000,000 4,000,000 119,000,000 Mar 115,000,00 285,000,000 2,850,000 117,850,000 Apr 115,000,00 170,000,000 1,700,000 116,700,000 201 Mar 55,000,000 55,000,000 Earning 55,550,000 550,000 82,500,000 Table 13: Tracking repayment of Nam Ha project 2007 Starting Balance Original Payable Interest arising Received July Aug 5,200,000,000 Sep 5,200,000,000 66 48,533,333 R Oct 5,200,000,000 52,000,000 R Nov 5,200,000,000 55,466,667 R Dec 5,200,000,000 116,000,000 50,266,667 R Jan 5,084,000,000 116,000,000 44,061,333 R Feb 4,968,000,000 116,000,000 51,336,000 R Mar 4,852,000,000 116,000,000 56,153,814 R Apr 4,736,000,000 116,000,000 59,705,173 R May 4,620,000,000 116,000,000 58,242,800 R June 4,504,000,000 116,000,000 July 4,388,000,000 116,000,000 Aug 4,272,000,000 116,000,000 Sep 4,156,000,000 116,000,000 Oct 4,040,000,000 116,000,000 Nov 3,924,000,000 116,000,000 Dec 3,808,000,000 116,000,000 Jan 3,692,000,000 116,000,000 Feb 3,576,000,000 116,000,000 Mar 3,460,000,000 116,000,000 Apr 3,344,000,000 116,000,000 May 3,228,000,000 116,000,000 June 3,112,000,000 116,000,000 July 2,996,000,000 116,000,000 Aug 2,880,000,000 116,000,000 Sep 2,764,000,000 116,000,000 Oct 2,648,000,000 116,000,000 Nov 2,532,000,000 116,000,000 Dec 2,416,000,000 116,000,000 2008 2009 2010 67 Jan 2,300,000,000 116,000,000 Feb 2,184,000,000 116,000,000 Mar 2,068,000,000 116,000,000 Apr 1,952,000,000 116,000,000 May 1,836,000,000 116,000,000 June 1,720,000,000 116,000,000 July 1,604,000,000 116,000,000 Aug 1,488,000,000 116,000,000 Sep 1,372,000,000 116,000,000 Oct 1,256,000,000 116,000,000 Nov 1,140,000,000 116,000,000 Dec 1,024,000,000 116,000,000 0 Jan 908,000,000 116,000,000 Feb 792,000,000 116,000,000 Mar 676,000,000 116,000,000 Apr 560,000,000 116,000,000 May 444,000,000 116,000,000 June 328,000,000 116,000,000 2011 212,000,000 68 [...]... SITUATION OF FINANCIAL APPRAISAL OF INVESTMENT PROJECT IN BIDV GIAI PHONG 4.1 General information of investment project appraisal in BIDV Giai Phong 4.1.1 The process of financial appraisal of investment project in BIDV Giai Phong The appraisal of investment projects in BIDV Giai Phong includes the following steps: Step 1: After receiving the loan file project, appraisal staffs check its facilities appraisal. .. potential project 4.1.2 The content of financial appraisal of investment project in BIDV Giai Phong Regarding the instruction of project appraisal and the lending procedure of BIDV Giai Phong, the content of financial appraisal of investment project carries out through the following factors: Collect and process information about customers and their projects: BIDV verifies the accuracy of the information sent... Because if the leaders of the credit institutions 28 that finance the appraisal project is unnecessary for the credit institutions would not have the financial appraisal of the project before making investment decisions Business financial appraisal of investment projects are just really interested and advanced when the leaders of the credit institutions recognize the significance of this work for investment. .. improvements in the financing structure of the project The cash flow statement describes the ability of a project to raise its own financing and to assess whether it is financially sustainable The latter is summarized by indicators such as the financial internal rate of return (FRR), i.e the discount rate that yields a zero net present value of the cash flow over the lifetime of the project The FRR is then... demand the appraisal officers modify and clarify the projects Step 5: Bank staffs finish contents of appraisal report, fill the necessary information and submit profile including appraisal report to the Head of Credit In particular, appraisal staffs often concentrate on estimating the financial effectiveness, analyzing each characteristics of project and the ability to pay off debt in order to find the. .. framework of action oriented actors in the economy, including credit institutions serving the common goal of society The defect in rationality, uniformity or negative of the legislation and policies of the State management can cause difficulties, increasing risks to the operating results of the project as well as the evaluation activities of credit institutions Some of the main shortcomings of the legal... Based on the volume of investment approved, appraisal staffs reinvestigate each source of capital and then evaluate the ability of certainty of each investment project Moreover, they also need to consider the cost and lending conditions of each capital source From these, BIDV officers will examine the possibility of capital sources - Credit line, term of lending and term of payment Level of lending: -... specified in the instruction of the process, appraisal staffs consider the projects and potential customers for a loan In the case of investigation, customers have to explain clearly Step 3: Financial factor of the projects will be sent to the Head in order to be taken into revision process by the appraisal officers 31 Step 4: After receiving the appraisal of projects, the Head examine and control commerce,... rate The project is financially viable if the NPV is positive The FRR and NPV capture different aspects of the project return, but in any case lead to the same conclusions with respect to viability 3.3 The factors affecting the quality of financial appraisal of investment project 3.3.1 Subjective factors Awareness of the leaders of the credit institution on the financial appraisal of the project: this... generate profits from one coin invested by the owners This is an indicator that investors most interest as it in indicates the income of the shareholder and the fact that banks in working effectively or not It likes the norms of BIDV Giai Phong in 2012, ROE is low (5%) that is level indicator is low than indicator of international standards But the index recovered two times since 2013 – 2014, the bank