lUẬN văn THẠC sĩ NÂNG CAO HIỆU QUẢ HUY ĐỘNG vốn tại BIDV CHI NHÁNH NAM hà nội GIAI đoạn 2008 2012 en

THESIS SUBJECT: IMPROVING THE CAPITAL MOBILIZATION EFFICIENCY AT BIDV’S SOUTHERN HANOI AFFILIATE IN THE PERIOD OF 2008 - 2012 INTRODUCTION The subject’s importance 2011 was a stormy year for the economy of Vietnam in general and for enterprises in particular The efforts made by the Government have helped Vietnamese economy partially overcome difficulties in 2011 However, there are still challenges facing Vietnam economy in the year of 2012 In 2012, Vietnam's economy has still been facing difficulties due to the global economic crisis and the impact of the fall in foreign direct and indirect investments To achieve the target of growing GDP from to 6.5% in 2012, onedigit inflation rate, the state budget deficit below 4.8% and credit growth from 1315%, it is necessary to the Government to monitor flexibly Besides, it can be seen that the State Bank of Vietnam and the Ministry of Finance will tighten their monetary and financial policies Accordingly, the three industries, which are predicted to face a great number of difficulties, include real estate, stock market and commercial banks Effective business performance is vital for any enterprise In order to establish a business and operate its activities, capital is a prerequisite condition to maintain and develop production activities and reflects the financial resources invested in the production process and business The hunger for capital is one of the pressing issues facing enterprises, particularly nowadays, when businesses expect to invest to expand their production and diversify their services to enhance their competitiveness after Vietnam joined World Trade Organization (WTO) Capital determines the competitiveness of every enterprise of which CBs are not the exception Efficient capital mobilizing (or fund-mobilizing) is the prerequisite for banks to survive and grow Like lending, capital - mobilization is a major and typical profession of a commercial bank (CB) In the process of socio-economic development in Vietnam today, capital demand is always among top priority issues before starting a new fiscal year This fact is mentioned since the socio-economic development and the enterprises’ development strongly depend on capital Particularly, CBs - financial institutions in financial markets which business in the field of money and currency, capital plays a more important role comparing with other organizations In the context of harsh competition in the banking sector nowadays, the efficiency of capital mobilization is one of the factors that help banks to improve their competitiveness in the market The main activity of CBs is lending, i.e providing loans and collecting interests Therefore, in order to meet the market capital needs, CBs must raise capital externally In other words, capital mobilization plays a key role for banks that want to survive and develop On the other hand, the development of credit institutions, especially CBs is the prerequisite for the development of the capital market, which facilitates the development of the social economy Those said analyses explain the importance of CBs’ capital mobilization to the current economic development and clarify why CBs’ capital mobilization profession should be studied and explored Given the difficulties that CBs must face in 2012 in addition to the target of controlling the credit growth and quality and limiting bad debts, the capital mobilizing target is placed on top by CBs Banking is a unique industry with its unique products and services since its equity accounts for a small percentage of the working capital Therefore, the more funds CBs can mobilize from economic entities, the easier their activities are Only by mobilizing capital can CBs have funds for lending and further improve their other activities That is the reason why a great number of banks mutually vie with others by increasing their interest rates for their effective capital mobilization The global financial crisis and economic downturn in the mid-2008 have had strong impact on the capital mobilization activities of Vietnamese CBs in general and of BIDV (Bank for Investment and Development of Vietnam) in particular The current international economic integration has created a great deal of challenges for CBs in Vietnam In fact, Vietnamese CBs seriously lack of funds due to their limited competitiveness in mobilizing capital and the low quality of services that not really meet customers’ demands This results in their ineffective business performance The capital issue has always been a top priority for BIDV Southern Hanoi affiliate over the past years Capital mobilization is considered effective when banks’ capitals are abundant and available to meet the needs of withdrawing cash as well as borrowing among inhabitants, enterprises and other organizations With its motto “Considering capital mobilization is an important stage and create space for firm capital growth”, BIDV Southern Hanoi affiliate has attempted to diversify fund mobilization forms through expanding its transaction network as well as improving the quality of banking services subject to the following criteria: "Fast, accurate and convenient for customers." However, capital mobilization is still a "hot" issue for BIDV Southern Hanoi Affiliate The economic fluctuations, the increase or decrease in gold prices and exchange rates have influenced most people’s psychology An illustration is that the increase in gold prices results in the trend in which almost all people tend to withdraw their deposits in banks to purchase gold for short-term and quick earnings Real estate market can also help its dealers earn much money Therefore, with the current low interest rates, it is difficult for banks to attract funds from individuals as well as businesses Accordingly, when banks are short of capital, it is not easy for them to ensure an abundant money supply to individuals and organizations According to the above-mentioned theoretical and practical analyses, I decide to select my MBA thesis subject namely "Improving the capital mobilization efficiency for BIDV’s Southern Hanoi Affiliate" The thesis objectives are raising my own theoretical awareness, knowledge and practical experience and partially contributing to strengthen the capital mobilization efficiency for the Affiliate The purposes and roles of the thesis are to clarify some fundamental issues on capital mobilization and present recommendations to improve its efficiency Research thesis purposes • Explain the basic theories relating to the capital mobilization efficiency for CBs in the market economy • Analyze and evaluate the efficiency of mobilizing capital at BIDV Southern Hanoi Affiliate Hanoi and look into its achievements, shortcomings and reasons • Propose solutions to improve the capital mobilization efficiency at the Bank Affiliate in the context of harsh competition in Vietnam today The subject and scope of the research thesis • Research thesis subject: the efficiency of CBs’ capital mobilization • Research thesis scope: covers the efficiency of BIDV’s Southern Hanoi Affiliate in 2008-2012 stage and proposing relevant solutions and recommendations to improve the capital mobilization efficiency for next periods Research thesis approach This thesis applies the following research methods: - Qualitative analysis, - Quantitative analysis, - Method of collecting information and data: data are collected from: + Report on the operation performance of BIDV’s Southern Hanoi Affiliate in 2008-2012 period, + Relevant documents, newspapers and professional journals - Methods of analysis and synthesis: + Chronological analysis and synthesis (2008-2012) + Subject analysis and synthesis (compared with other CBs) + Analysis and synthesis of subject groups and issue groups - Comparison method Structure of the thesis In addition to the introduction and the conclusion, the thesis content consists of three chapters: Chapter I FUNDAMENTAL THEORETICAL BASIS FOR CAPITAL MOBILIZATION EFFICIENCY OF CBS Chapter II MOBILIZATION SITUATION ANALYSIS EFFICIENCY AT OF ACTUAL CAPITAL BIDV’S SOUTHERN HANOI AFFILIATE Chapter III SOLUTIONS TO THE IMPROVEMENT OF CAPITAL MOBILIZATION EFFICIENCY AT AFFILIATE BIDV’S SOUTHERN HANOI CHAPTER I FUNDAMENTAL THEORETICAL BASIS FOR CAPITAL MOBILIZATION EFFICIENCY OF CBS 1.1 CBs’ capital and capital mobilization 1.1.1 Capital and the need of capital mobilization In economics, capital is a relatively complex category and it is difficult to find a consistent definition among viewpoints In his work namely Capital, Karl Marx outlined the categories of capital According to Marx, capital brings surplus value This definition fully reflects the nature of capital: 1) Capital represents a certain type of property; 2) Capital always circulates and makes profit during its circulation; 3) Capital is a commodity and like other commodities, it has actual purpose In short, capital is a property that is used in production in order to create more properties All in all, capital is a social property used to invest in future efficiency Therefore, in the market economy, regardless of any field or industry in which a company is doing business, capital plays an important role that determines its efficiency Banks, too, would like to work business effectively, leads to high efficiency is the command capital needs to be attention Banks are not the exception: in order to effectively operate, they must pay sound attention to their capital mobilization 1.1.2 Capital of CBs 1.1.2.1 The CB concept CB system is regarded as the result of long formation and development process of the commodity economy and the commodity and currency relations Although the concept of CBs is various in different nations, CB is regarded a professional monetary enterprise, a financial intermediary which transfer funds from abundant subjects to those are short of funds In Vietnam, the Ordinance on Banks, Credit Cooperative and Financial Corporation dated 1990 defines CB as follows: "CB is a monetary organization of which the main activity is to receive its customers’ deposits These deposits would be refunded to customers and used for loans, discounts and used as a method of payment.” There are several CB definitions depending on legal norm of each nation Vietnam is in the process of building and developing a financial market model of which the core part is CBs operated under the nation’s macro-regulation Thanks to the transition from a bureaucratic centralized economy to a market one with the country’s management, Vietnamese bank system has been significantly innovated A fundamental change in the bank organization model is the separation of the monetary and credit management function from the monetary trading function Other changes include the diversification of bank types, the gradual removal of the monopoly and the turning point to the competition model under the control of the government Two-level bank system has been formed in Vietnam since 1988 This system was officially legalized by two Ordinances on banks including Ordinance on State Bank and Ordinance on Credit Cooperative Bank and Financial Corporation dated 1990 Since then, the bank system model’s components have been as below: - State Bank: is a state management organization in the monetary, credit and banking industry - CBs: are enterprises that monetary business Accordingly, in order to strengthen management, guide the activities of banks and other credit institutions, and create favorable conditions for the development of the economy while protect the legitimate interests of relevant organizations and individuals, Article 20 of the Law on the Organization of Vietnam was issued in 1997/10th National Assembly The Article states: "CBs are now established under the provisions of this law and other legal regulations on monetary trades, banking services relating to customers’ deposits These banks’ responsibilities are to refund deposits to customers and use deposits for discount and payment services " As being defined above, CBs are businesses operating in the monetary sector, have the accounting of revenue and expenditure, take the performance business into account and always seek ways to maximize their profitability through the follows: - Deposits of customers including businesses, individuals, organizations and state agencies, and - Using deposits for loans and discounts Besides, CBs have other services including guarantee, collection, and payment, etc The development of CBs is associated with the development of financial markets At the early stage, CBs’ organization and operations were quite simple but they are increasingly complex and professional Nowadays, CBs tend to further and comprehensively expand their operation scale and diversify with a variety of services and mobilize most social idle funds for loans The development of the CBs is no longer limited within the domestic market but start to expand into international markets Some examples of international banks are the World Bank (WB), Banks Asian Development Bank (ADB), etc The application of information technology and modern equipment system makes banks’ activities more complete While CBs have function of receiving money to lend, and play the role as financial intermediaries, they have to comply with the state management and are under the control of the State Bank of Vietnam Through this management system, CB system performed its functions in the economy 1.1.2.2 CBs’ features CBs share these following characteristics: CBs are enterprises that make profits through interests Their main aim is the pursuit of profit The business type of CBs is unique with the right of using money and non-physical-products and activities being associated with the circulation of currency A CB is a business type of higher risk levels than with other forms of business and often has profound effects on other sectors and the whole economy Therefore, in order to avoid risks, control and minimize damages resulting from banks’ bankruptcy, the government has issued special laws to ensure that the banks’ operations are safe and effective CBs are typical financial intermediaries: - CBs are intermediaries between those have abundant funds and those need funds - CBs are intermediaries between the central bank and both individuals and the economy 1.1.2.3 Roles of CBs In the current conditions of our country, the state budget is limited so it cannot be entirely relied on Besides, the stock markets, which have recently been formed with scarce goods and low performance, cannot fully meet the capital demands Therefore, in the next periods, mobilizing capital for the development of the economy is mainly made through financial intermediaries, particularly banks That is the reason why banking activities are an important factor promoting the development of the economy Several important roles CBs are as follows: - Thanks to their capital mobilizing and lending activities, CBs address temporary capital lacks in the economy and help organizations operate more effectively - Operations of CBs contribute to enhance enterprises’ business performance, thereby contribute to the development of the economy - CBs allocate funds among regions; thereby create the conditions for the uniform economic developments among different regions within a country - Effective activities of CBs contribute to the implementation of the national monetary policies such as price stabilization, inflation control, job creation and economic growth - CBs are bridges spanning nations 10 3.3.2.1 To inhibit inflation, to stabilize the money value This helps to attract deposits from the population into the banking system to avoid accumulation in the form of gold, foreign currency, or real estate investment This also helps reduce the pressure of mobilizing interest rates for CBs Mobilizing interest rates not increase means that lending interest rates are also stable This creates conditions for economic entities which are in need of capital to access the idle capital in the society So the effectiveness of CBs’ mobilization will be highly appreciated To this, the Central Bank needs to implement flexible monetary policies, operate monetary policies in the direction of coordinating direct tools (line of credit, central bank bills, fixed frame rate, etc.) as well as indirect tools (required reserves, refinancing, open market operations, etc.) 3.3.2.2 Together with the government to promote the development of the bank payment Along with the government, the Central Bank should consolidate the legal system in non-cash payments in order to promote the development of this activity and facilitate CBs to attract large amounts of capital with low costs of capital using in payment, whereby the capital mobilization’s efficiency is also enhanced Besides, the Central Bank should develop the technical infrastructure and payment software and programs among CBs synchronously so that payments between banks can be coordinated in the best and fastest way To this, the Central Bank has to be in charge to link and guide the banks to implement At the same time, the Central Bank should also expand the scope of payment in the payment system in order for CBs to be more active in setting cost to customers 3.3.2.3 To continue flexibly operating the interest rate tool, the monetary policies, and the fiscal policies The Central Bank maintains the official interest rates: basic interest rate, rediscount rate, open market interest rates, etc at reasonable levels based on the respect for the market’s principles Besides, the interest rates must match with the country’s economic goals in each period This creates favorable conditions for CBs 91 to determine reasonable mobilizing and lending interest rates, which helps them to build appropriate mobilization plan more easily 3.3.2.4 To develop open market operations Developing open market operations will help CBs to use capital more efficiently and be more active in venturing the capital The liquidity of the valuable papers that CBs hold is greatly increased through open market operations The CBs, therefore, will be more assured when investing in valuable papers Products on the open market are also a channel of investment for them to improve business performance Therefore, the Central Bank should expand the open market operations through increasing the goods in this market The diversification of products traded on the open market can help banks diversify their portfolio, whereby the efficiency of capital use will be higher The Central Bank also needs to synchronize the equipments and applications of modern science and technology to be suitable for this market’s development requirements Moreover, the Central Bank must enhance information security in computer networks (especially the sensitive information) in order to prevent and minimize business risks 3.3.2.5 To create policies supporting CBs in technology innovation Innovating technology is necessary for CBs to keep up with the development of the world It also played a part in improving the CBs’ efficiency of mobilization Therefore, the Central Bank needs to support CBs financially as well as human resource training for the technology innovation The Banks’ Association – a focal point for training for CBs must further improve the quality of abroad training courses which should go into practice rather than being a perfunctory visit so that they are really useful and effective 3.3.3 For the Bank for Investment and Development of Vietnam (BIDV) In the near future, to create favorable conditions as well as to encourage the mobilization activity of the branch to be more effective, the BIDV should introduce the following strategies: 92 3.3.3.1 To build a reasonable business strategy based on the specific conditions of the branches The BIDV should be based on the market situation and requirements to be the branch specific conditions of financial capacity, local activities, human, etc to determine, build, and perfect a reasonable business development strategy which is right in all the business activities of the bank, and then set out appropriate measures to implement it Identifying, developing, and building measures to implement and adjust business strategy is to specify the strategy into activities which are in accordance with market conditions, the branch’s capability in each period BIDV’s business development strategy has to get a mixed strategy which is unique, consisting of the strategies of each individual business strategy These strategies are composed closely to each other, interacting complementarily in the unity in line with the overall development strategy The bank’s development strategy must be realistic and feasible in the organization and construction If it needs to be adjusted, it must be based on the actual factors involved in the market Moreover, the strategy must be able to predict the future of the market, the development of requirements, and the purpose of the implementation as well as the BIDV’s capacity in general and each base unit’s capacity in particular, thereby ensuring the development of the whole system The strategy of capital mobilizing is considered an important strategy constitutes the bank’s mobilizing strategy So when building and adjusting this strategy, beside the identification of specific and logic targets, the bank has to set strict, effective, and dynamic performance measures which surely can completely meet the above principles, i.e to always stick to the situation of the bank, each branch, market factors, etc On the other hand, mobilizing strategy must be a consolidated entity of strategic components in the systematic relationship with the bank’s development strategies on all aspects under the provisions of the overall development strategy If so, the business operations in general and capital mobilization in particular of the BIDV and its member units can achieve high efficiency 93 3.3.3.2 To develop and expand the BIDV network Along with the development of a rational long-term business strategy on the basis of financial capacity, employees’ qualifications, etc., in the next time the BIDV needs to have measures to promote and develop its branch and unit member network in order to create a logical structure on the whole system In particular, the bank pays special attention to the export processing zones, new key economic zones, populated areas, and rural areas However, promoting the expansion and the development of its branch network, particularly to rural and remote areas makes the management become much harder and more complex than ever But it is not infeasible, so far many banks has proactively expanded their branch network in these areas and initially reap some certain success The BIDV – a bank which is always at the forefront in expanding network and business scope – is a typical of them Another problem that the bank should consider when expanding its network is that it must account for the “cost” of network expansion Because if the network expansion makes the bank’s cost so high that it must set high lending interest rate or cut down the input interest rates to compensate this additional cost, it is not as effective as desired but can become a factor which directly reduces the business effectiveness of the bank Along with the expansion of its branch network, BIDV also needs to reinforce, improve its quality and innovate the operations of its current savings funds and transaction offices Besides, it need to be more active and bold in the business expansion and diversification; perform many types of services such as accepting deposits, lending, and purchasing and selling foreign currencies and gold and silver, etc.; make sure to meet the needs of customers coming to the bank, through which the bank can mobilize a lot of idle capital from customers In summary, hereby are some solutions and recommendations to improve the performance of capital mobilization activity in the Bank for Investment & Development of Vietnam - South Hanoi Branch All the solutions, whether at the micro or macro, have close relationships with each other and must be combined synchronously and consistently to bring real success for capital mobilization of the branch 94 CONCLUSION Integrating with the international economy is both an opportunity and a challenge for businesses in general and the CB system in particular To adapt to the harsh change, Vietnamese CBs generally and BIDV particularly have to make changes in the mechanism of organization and management, reform in all aspects so that their performance gets the best results In addition to maintaining and promoting its advantages, BIDV needs to learn, take over new and modern ideas to improve its competitiveness and advance firmly on the path of integration with the international economy To create a solid step in the market and be stably profitable, CBs must strive in every of their services CBs’ capital mobilization is a quite abundant and diverse For a deeper understanding of this activity, there is a need of a greater study By approaching the capital mobilization activity from the origin, the economic nature and legal characteristics, this topic offers a comprehensive view of each mobilizing operations and solutions to improve the efficiency of capital mobilization in the Bank for Investment and Development of Vietnam - South Hanoi branch The achievements initially confirm the correctness of the direction and administration policy of the government, the Central Bank in the bank’s business lines However, in comparison to other branches of the Bank as well as to other banks, the achievements are still limited So in the future, facing increasingly fierce competitive challenges, the BIDV South Hanoi branch has to take measures to further improve the quality of capital mobilization To this, in addition to the its efforts, the bank also needs the supports from the government and the Central Bank in the creation of a favorable macroeconomic environment for the Bank for Investment and Development of Vietnam to this well On the other hand, there should be a highly co-determination and a revolution in the branch’s operations so that it can overcome all difficulties and bring back success to ensure the target of strong growth in mobilized capital then become one of the best branches of the BIDV 95 Despite my having time to study, the solutions and recommendations given in the thesis may not be complete and specific due to my limited experience and ability However, I hope to be able to contribute a small part in the activity of improving the efficiency of the bank’s mobilization in the coming time I would like to send my sincere thanks to Dr Nguyen Thanh Hieu, the teachers in the department, the Bank for Investment and Development of Vietnam – South Hanoi Branch for their enthusiastic help during the study and completion of this thesis 96 REFERENCES Finance Theory Textbook, Duong Dang Chinh, Hanoi Finance Publisher, 2003 Modern banking operations, David Cox, National Political Publishing House, 1997 Monetary Banking and Financial Markets, Frederic.S.Miishkin, Science and Technology Publishing House, 1995 Business Executive Textbook, Prof Dr Nguyen Thanh Do, Dr Nguyen Ngoc Huyen, Publishing House of the National Economics University Hanoi, 2007 Bank Management, Ho Dieu, Statistical Publishing House CB Operations, Nguyen Thi Mui, Statistical Publishing House, 2004 Financial and Monetary Theory Textbook, Nguyen Huu Tai (chief editor), Statistical Publishing House, 2002 Income Statements in 2008, 2009, 2010, 2011 and the first six months of 2012, the Bank for Investment and Development of Vietnam - South Hanoi Branch CBs, A.P Phan Thi Thu Ha, Publishing House of the National Economics University Hanoi 10 The Law on Credit Institutions, National Assembly of the Socialist Republic of Vietnam, National Political Publishing House, 1998 97 WARRANTY I hereby declare that the contents are presented in this thesis is the result of my research The information and data presented in this project is completely honest The thesis used references, documents, and information which were given on printed publications, magazines, and websites as the list of references AUTHOR NGUYEN VAN HIEU 98 ABBREVIATIONS BIDV CB ICOR ROR VND : The Bank for Investment and Development of : : : : Vietnam Commercial Bank Incremental Capital Output Ratio Return on Revenue Vietnam dong 99 TABLE AND CONTENT INTRODUCTION The subject’s importance 2 Research thesis purposes • Explain the basic theories relating to the capital mobilization efficiency for CBs in the market economy .5 • Analyze and evaluate the efficiency of mobilizing capital at BIDV Southern Hanoi Affiliate Hanoi and look into its achievements, shortcomings and reasons The subject and scope of the research thesis Research thesis approach 5 Structure of the thesis .5 CHAPTER I FUNDAMENTAL THEORETICAL BASIS FOR CAPITAL MOBILIZATION EFFICIENCY OF CBS 1.1 CBs’ capital and capital mobilization 1.1.1 Capital and the need of capital mobilization 1.1.2 Capital of CBs 1.1.2.1 The CB concept 1.1.2.2 CBs’ features .9 1.1.2.3 Roles of CBs 10 1.1.2.4 The functions of CBs 11 1.1.2.5 Capital of CB definition 11 1.1.2.6 Funds of CBs .13 1.1.3.2 Objectives and principles of mobilizing capital at CBs 19 1.2 The efficiency of CBs’ capital mobilization 24 1.2.1 The concept of capital mobilization efficiency 24 1.2.2 The need to improve the efficiency of capital mobilization .24 1.2.3.Criteria for evaluating the capital mobilization efficiency 26 1.2.3.1 The qualitative indicators evaluating the efficiency of banks’ capital mobilization 26 100 1.2.3.2 The quantitative indicators evaluating the efficiency of banks’ capital mobilization 27 1.2.4.1.Objective factors 31 * The legal environment and the macro-economic policies 31 1.2.4.2.Subjective factors .32 Chapter II 37 SITUATION ANALYSIS OF ACTUAL CAPITAL MOBILIZATION EFFICIENCY AT BIDV’S SOUTHERN HANOI AFFILIATE 37 2.1 An overview of the Bank for Investment and Development of Vietnam – Southern Hanoi Affiliate 37 2.1.1 Formation history BIDV’s Southern Hanoi Affiliate 37 2.1.3.1 Mobilization activities .42 2.1.3.2 The use of capital (loans and investments) 45 2.1.3.3 The provision of banking services .48 2.2 The reality of capital mobilization’s effectiveness at the BIDV – South Hanoi Branch .50 2.2.1.The reality of capital mobilization at the BIDV - South Hanoi Branch 51 2.2.1.1 Profit from capital mobilization 51 2.2.1.2 The Return on Revenue (ROR) 52 2.2.1.3 The Return on Cost 53 2.2.1.4 The growth of mobilized capital 54 2.2.1.5 The compatibility between capital mobilized and capital demand 56 2.2.2 The scale and structure of capital mobilization at BIDV South Hanoi Branch .58 2.2.2.1 The form of capital mobilization .58 2.2.2.2 The maturity of mobilized capital .60 2.2.2.3 Issuance of debt instruments .61 2.2.2.4 Other forms of mobilization 62 2.3.1 Assessment on the effectiveness of capital mobilization by criteria and by the results achieved 63 2.3.1.1 The branch always mobilizes capital effectively .64 2.3.1.2 The amount of capital mobilized is large and has good quality 64 2.3.1.3 The capital mobilized structure is initially diverse and consistent with the capital demand 64 2.3.1.4 Mobilized capital adequacy .65 2.3.2.The backlogs in the mobilization activity and the causes .67 2.3.2.1 The backlogs 67 2.3.2.2 The causes of the backlogs 69 101 CHAPTER III 73 SOLUTIONS FOR IMPROVING THE EFFICIENCY OF CAPITAL MOBILIZATION IN BIDV - SOUTH HANOI BRANCH 73 3.1 The concept of improving the efficiency of capital mobilization at the Bank for Investment & Development of Vietnam - South Hanoi Branch 73 3.1.1 To increase mobilized capital of the lowest cost 73 3.1.2 To mobilize all source of capital in the area at the highest level 74 3.1.3 To enhance the effectiveness of capital mobilization together with the efficiency of capital use .74 3.1.4 To increase the proportion of medium- and longterm capital to meet customer demand for loans 75 3.2 A number of measures to improve the efficiency of capital mobilization in the Bank for Investment & Development of Vietnam - South Hanoi Branch .76 3.2.1 To maintain, improve the policy of mobilizing interest rate flexibly and reasonably to minimize the mobilization cost .76 3.2.2 To continue to diversify capital mobilization forms and build a mobilizing strategy match with capital using 79 3.2.3 develop the mobilization plan and capital structure appropriate to the use of capital 81 3.2.4.To promote Marketing and enhance the position of the bank 81 3.2.5.To innovate and modernize the banking technology 83 3.2.6 To strengthen the deposit by all measures 84 3.2.7 To development services related to capital mobilization in order to attract low-cost capital .85 102 3.2.8.To continue to improve and enhance the qualifications of employees 86 3.3 Recommendations 88 3.3.1.For the Government .88 3.3.1.1 Create a stable macroeconomic environment 88 3.3.1.2 Promote non-cash payment .88 3.3.1.3 Complete the system of competition law 89 3.3.1.4 Promote the development of the financial market .89 3.3.2.For the Central Bank 90 3.3.2.1 To inhibit inflation, to stabilize the money value 91 3.3.2.2 Together with the government to promote the development of the bank payment 91 3.3.2.3 To continue flexibly operating the interest rate tool, the monetary policies, and the fiscal policies .91 3.3.2.4 To develop open market operations 92 3.3.2.5 To create policies supporting CBs in technology innovation 92 3.3.3.2 To develop and expand the BIDV network .94 REFERENCES 97 WARRANTY 98 ABBREVIATIONS 99 TABLE AND CONTENT 100 103 LIST OF TABLE Diagram 2.1: Organization Chart of BIDV’s Southern Hanoi Affiliate 39 Table 2.1: The capital structure of mobilized capital 42 Table 2.2: Structure of the outstanding credit 46 Table 2.3: Profit from capital mobilization 51 Table 2.4: Return on Revenue 52 Table 2.5: Return on Cost .53 Table 2.6: The branch’s volume of mobilized capital 54 Table 2.7: The relationship between capital mobilization and capital usage 56 Table 2.8: Short-term deposits and loans .57 Table 2.9: Medium- and long-term capital mobilization and loans .57 Table 2.10: The structure of the mobilized capital .58 Table 2.11: Results of capital mobilization by maturity .60 Table 2.12 The results of capital mobilization through the issuance of debt instruments .61 104 ... for Investment and Development of Vietnam (01/11/2005 - 5 /2012) - Southern Hanoi Affiliate of Bank for Investment and Development of Vietnam JSC (5 /2012 to present) Since 1995 - when BIDV became... the mid -2008 have had strong impact on the capital mobilization activities of Vietnamese CBs in general and of BIDV (Bank for Investment and Development of Vietnam) in particular The current international... quantities) 16 * Components: Loans from the Central Bank and other CBs When the mobilized capital is not enough while the demands for payment and refunding to customers increase, CBs must lend in order