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1 INTRODUCTION Rationale Over the years, small and medium-sized enterprises (SMEs) has confirmed its position and its role in the national economy with particular dynamic, flexible and adapt to the changes of the market SMEs create jobs for nearly half of the employees working in enterprises Since then, these enterprises have contributed significantly to solving social problems and reducing poverty SMEs also create close links with large enterprises to effectively participate in the value chain SMEs are affirming their indispensable role in the socio-economic development process of the country, contributing significantly to the GDP and the general export deficit of the whole country, as well as to each province, including Nghe An province As of the end of 2016, despite being faced with the difficult conditions of the economy, however, SMEs in Nghe An province is still maintained growth and development According to statistics, as of 31/12/2016 in Nghe An province, there are 8,406 enterprises in which the number of SMEs in the province is 8,345 enterprises (The number of small and medium enterprises in the field of industry and construction is about 3,195 enterprises with 1,325 manufacturing enterprises and 1,870 construction enterprises) with total registered capital of the enterprise average of 4.5 billion, employing more than 150,000 people Besides the achievements of SMEs on growth, development scale, Enterprises also contributed greatly to the overall socio-economic development of Nghe An province, SMEs in general and SMEs in the field of industry and construction in particular, are also faced with many difficulties such as capital investment difficulties in production and business, difficulties in the market, difficulties in science and technology, efficiency of production and business of SMEs in the field of industry and construction Add to that the needs of socio-economic development of Nghe An province, development requirements of small and medium-sized enterprises which require the development of SMEs in the field of industrial and construction To achieve the required development of SMEs in the fields of industry and construction, capital needs of SMEs in the fields of industry and construction in particular, SMEs in the province of Nghe An in general is relatively large According to the result of survey of the BSPS on the forecast of the demand for investment capital of SMEs in Nghe An province compared with the outstanding loans of credit institutions for SMEs (Only meet less than 1/3 of the existing DN) for the role of lending to this region is very important and urgent As of the end of 2016, in Nghe An province has branches of joint-stock commercial bank has no state capital, branches of commercial banks, shares of the state capital, These banks have contributed significantly in supporting the loan flow for SMEs in Nghe An province.However, with the demand for loans of enterprises is large, the size of loan capital of banks has not really met the needs of enterprises, especially SMEs in the field of industry in Nghe An province The role of commercial banks in lending to small and medium enterprises development is not only received by policy makers but also by the interest of researchers, The research was carried out to explore the different aspects of lending, SME development, some case studies such as Kazuo Ogawa et al (2011), Vo Duc Toan (2012), Nguyen Thi Mui (2006) Facing this situation, the authors selected: "Lending role of joint stock commercial banks in the development of small and medium enterprises Research conducted in NgheAn province" research topics Research objectives and research task 2.1 Objectives Based on the analysis of the current situation of lending activities of commercial joint stock commercial banks to the development of SMEs in the field of industry and construction, the Dissertation proposes measures and solutions to enhance the role of lending activities of the joint stock commercial banks for the development of SMEs in the field of industry and construction in the Nghe An province until 2025 2.2 Tasks of research Commentary and explain the rationale for the role of commercial joint stock commercial banks in SME development Analyzing the experience of lending activities of commercial joint stock commercial banks in the development of SMEs in the field of construction and civil engineering in some localities and drawing lessons for Nghe An province Assessing the current situation of lending activities of commercial joint stock commercial banks to the development of SMEs in the field of industry and construction in the province of Nghe An, showing the limited achievements and causes of limitations Proposing the directions and solutions to enhance the role of commercial joint stock commercial banks in the development of SMEs in the field of industry and construction in Nghe An province by 2025 Subjects and scope of research 3.1 Subjects of research The role of lending activity of commercial joint stock bank for the development of SMEs in the industrial sector and construction 3.2 Scope of research Content: The role of commercial joint stock banks in SME development is examined in terms of scale and speed development; structure change; quality and efficiency of business of SMEs in the industrial sector and construction Factors affecting the role of commercial joint stock banks in lending: policy institutions, management organizations, endogenous capacities of banks and endogenous capacities of SMEs The scope of research is: Branches JSB has no state capital and SMEs operating in the fields of industry and construction in the Nghe An province (Currently in Nghe An province: branches of a state-owned commercial bank and three state owned commercial joint stock banks; 22 branches of commercial banks have no capital of the State) Small and medium enterprises in the field of construction industry in Nghe An province, the proportion of these enterprises accounts for nearly 40% of the small and medium enterprises in Nghe An - This is one of the groups of enterprises that make up a large proportion, contributing relatively to the general economic development of Nghe An province Therefore, the authors selected non-state-owned joint stock commercial banks and SMEs in the construction and construction industry to be representative of the research subjects About time: Information on the situation analysis from 2010-2016, recommended until 2025 About space: Research in Nghe An, because Nghe An province is located in the center of the North Central region, this is a locality that has all the elements for economic development, attract investment capital from enterprises, business development from the transportation system, It is a gateway of the North and South In addition, with the general policy of Nghe An province in promoting the development of industry and tourism development has been creating favorable conditions for industrial and construction enterprises in the area with development conditions At the same time, the scale of growth and development of small and medium enterprises in Nghe An province, the system of branches of joint stock commercial banks in Nghe An province is very large Therefore, the author selected research in Nghe An meet the requirements and ensure the ability to generalize to other localities across the country Thesis structure Along with the introduction, conclusion, list of references, the appendix, the thesis consists of chapters: Chapter 1: Overview of Research and Methodology Chapter 2: Basis theoretical and Practical Experience on the Lending Role of Commercial Joint Stock Banks for the Development of Small and Medium Enterprises Chapter 3: Situation of lending activities of commercial joint stock commercial banks for development of small and medium enterprises in the field of industry and construction in Nghe An province Chapter 4: Directions and solutions to enhance the role of commercial joint stock commercial banks in the development of small and medium enterprises in the field of industry and construction in Nghe An province in the coming years CHAPTER OVERVIEW AND RESEARCH METHODOLOGY 1.1 Research Overview SMEs and SME, the development of SMEs is the problem that has received great attention not only of researchers in the world, but also get the attention of researchers in the country, as well as policy makers The studies mentioned different aspects of this issue under different approaches, this may be the location of this research important in practice as in theory Specific research on this issue:"The Nature of the Firm" by Ronald Harry Coase (1937), The author presents theories to demonstrate the viability of the SME sector in each economy such as the theory of economies of scale, or another theory has been mentioned to explain the inevitability of SME development as the theory of industrial production organization has been shown in the study:"What Determines Firm Size?" by Krishana B Kumar et al (1999), Or is that the theory of transaction costs in the work of Oliver et al (1995) There are many different factors affecting the development of SMEs, one of the factors referred to when researching the development of this type of businesses is the impact of the credit of the organization credit institutions, banks The research was carried out to explore the different aspects of credit, SME development, enterprises Specifically: 1.1.1 Overview some research on the role of lending activities of joint-stock commercial banks for SME development In fact, the target audience of commercial banks in general and commercial joint stock banks in particular, an important customer segment is SMEs, and credit loans of banks for This type of SME plays a very important role in the development of these enterprises In the study by Sophie Brana et al (1999), it was found that: With the use of data from a survey of 420 SMEs operating in Russia, adding that the secondary data in the annual survey of the Economic Russia (REB) performed, the data obtained is real the size of their operations and the actual performance of their businesses.Results of the analysis of data showed that the research results are contrary to the initial estimate of the authors, with technical factor analysis and regression model used Probit hierarchy to test the relationship between different factors: The results indicate that most of the demand for credit is primarily attributable to weak or debtridden businesses, and that bank credits are largely allocated to firms in difficulty financial issues or poor financial situation.The approach of this study is quite similar to that of Commander et al (1993), where the focus of the analysis of the research problem based on the physical indicators is mainly as a change in the production employment or employment is the measure of the output of the development of SMEs, correlated with financial indicators such as profitability and financial resources of the enterprise The study also examines the relationship between business development and bank lending, because of the development of businesses or the development strategies of sub-banks themselves Relying on the way the use of these credits with both groups of subjects At the same time, in the study, the author also developed a model for predicting the need for credit capital of SMEs for the development of this business in the face of market hardships or shocks, or face plans and projects of the business activities In addition, Jaffe (1971), Ramey (1992) and Nilsen (2002) obtained similar evidence supporting the view of redistribution from time series data And the advantages and difficulties of SMEs in particular and business in general when accessing credit loans from banks Petersen and Rajan (1997) conducted their first study on the role of credit redistribution, based on data from US firms Based on a national survey of Small Business Financing (NSSBF), they found that a company's access to external financing had a significant positive effect on the amount of receivables.They also found that firms that did not use credit demand had less commercial credit Moreover, the results of the study also showed that a longer relationship with financial institutions was negatively correlated, with a commercial need Consequently, they conclude that commercial credit is used more by companies that are restricted by lenders 1.1.2 Some research on the role and the factors affecting the lending role of joint-stock commercial banks for the development of SMEs, factors that influence the development of SMEs are one of the areas that have received considerable interest from scientists, and a large number of research studies have been carried out around SME issues: Research on the status of development of SMEs on different scales, research on different types of SMEs in different fields such as construction industry, agriculture, services One aspect that is frequently mentioned in the study of SMEs is the development of these enterprises, factors that influence the development of SMEs, such as research by Nguyen Quoc Nghi (2011), Sophie Brana et al (1999), Vo Duc Toan (2012), Vo Thanh Danh et al (2013), Pham Van Hong (2007) Each research approach different directions, analysis and data processing are different, however, in this study is quite unified view of SMEs: capital size, number of employees of businesses and national studies use Decree No 56/2009 / ND-CP to classify SMEs Relating to SMEs, bank credit to SMEs not only the attention of policy makers, managers reality but also the attention of scientists, However, these studies were stopped in consideration of the current status of the development of SMEs on a national scale, or in different countries A number of studies have been conducted for SMEs in the provinces, but are conducted in the southern provinces and in the provinces of the Mekong River Delta These studies are mainly considered in the context of understanding demand of enterprises, the assessment of enterprises' ability to meet credit capital of commercial banks to the development of enterprises, access to capital of enterprises through statistical data and investigation of enterprise 1.1.3 The issues raised in the study the role of commercial bank lending activities for development of SMEs Overall, the researchers published uniformity quite large in views relating to SMEs, the role of SMEs for the development of economy, society, the factors affecting the credit Banks with SMEs, in which institutional factors, policies, commercial banks' capacity, and the capacity of the enterprises themselves have been mentioned Based on the data collected, the authors have developed recommendations to help SMEs grow under the support of commercial banks However, studies have not shown a specific role of commercial bank loans for development of SMEs How does commercial lending impact changes in size, growth rate, structural change as well as the efficiency of SMEs? Reasons leading to these effects?, What are the institutional environment, commercial lending capacity of SMEs and the capital use capacity of SMEs to enhance the positive impact of commercial lending on SME development? How to enhance the positive impact of the activities of commercial banks' lending to the development of SMEs? The topic of lending activity of commercial joint stock commercial banks to the development of SMEs in the field of industry and construction (S & T), which the authors selected for this study, contributes to answer these questions 1.2 Research Methodology 1.2.1 Research Questions Understand what is the role of commercial joint stock commercial banks in SME development? Reality and role role of commercial bank lending to the development of SMEs in the field of Industrial & Construction Nghe An province now like? To strengthen the role of commercial bank lending to the development of SMEs in the field of Industrial & Construction Nghe An province need to have what the solution? 1.2.2 Research models Factors affecting the role of lending include the following components: i) Institutional policies; ii) Endogenous capacity of banks; iii) Endogenous capacity of the SME sector Lending activity of banks consisting of the elements: i) Loan size; ii) Interest rate; iii) Loan terms and conditions The role (impact) of lending to SME development includes the following components: i) Scale of scale, speed; ii) Industry structure; iii) Efficiency of production and business The research process that answers the questions, assumptions and models is shown in the following diagram: Factors affecting the role of lending activity Institutional policies Endogenous capacity of the bank Endogenous capacity of the SME sector The content of lending activities of JSCB - Scale - Interest rate - Conditions The role of lending to the development of SMEs - Change the scale, speed - Changing the structure of industries - Improving the efficiency of Criteria evaluate - The criteria for factors affecting lending operations role - The criteria for lending operations - The criteria for the development of SMEs Solutions to enhance the role of lending activity 1.2.3 Data collection method The study used a combination of the methods of qualitative research and quantitative research methods 1.2.3.1 Qualitative research methods The in-depth interview was used in this study, and in-depth research was conducted to obtain more analytical data and perspective after analyzing the quantitative data demonstrating the role of activity loans of joint stock 10 commercial banks for the development of small and medium enterprises in the province of Nghe An Specifically, the author consulted experts who are credit officers in two branches of joint stock commercial banks without state capital in Nghe An province and representatives are managers of Small and medium enterprises in the field of industry and construction in Nghe An province All objects are selected for interview are those who have knowledge of the role lending activities of commercial banks shares for the development of small and medium-sized enterprises in the fields of industry and construction However, limitations of the method of in-depth interviews are data obtained from the survey results bring subjective opinion of objects surveyed, to limit the weaknesses of this method, researcher chose subjects surveyed who are responsible for the answers and understand the field of research of the author The results of the in-depth interviews gave the graduate students a more multidimensional perspective on the research and assisted PhD students in the quantitative analysis of research results based on data collected from journals report and annual summary of data collected from the survey subjects from business, banking and government managers 1.2.3.2 Quantitative research methods The author intends to interview SMEs operating in the field of industry and construction in Nghe An province who have or are using credit services of non-state owned JSCBs through standardized questionnaires * Expert advice: The thesis builds the sample survey questionnaire on the content of the research and consulted 10 experts on the scale of assessing the lending role of commercial joint stock commercial banks on the development of SMEs on the basis of that will adjust the scale accordingly * Research sample: The target group of SMEs in the field of industry and construction in Nghe An province are using credit services of joint stock commercial banks without capital from the State As noted, the industry and construction sector in Nghe An is currently 2,611 enterprises Therefore, it is necessary to identify the sample to be sufficiently analyzed to ensure the accuracy of the information 11 There are many different conceptions of the survey sample Nunnally and Burnstein (1994) ssume that the ML (Maximum Likelihood) estimation method requires a sample size of at least 100-150 According to Hoelter (1983), the critical sample size must be 200 According to Nguyen Dinh Tho and Nguyen Mai Trang (2007) the sample size must be at least to times the number of variables in the questionnaire Therefore, with the estimated questionnaire size of 55-60, the sample size is expected to be 300 questionnaires (of which 20 are non-state-owned joint stock banks and 100 SMEs and related agencies.) 1.2.3.3 Data collection methods Secondary data: Authors collected through annual financial statements of joint stock commercial banks, through the statistics of the State agencies, magazines, scientific research published Primary data: The author conducted a survey, interviews with SME leaders, questionnaires in form M1 and M2 1.2.3.4 Data analysis method Research using descriptive statistical method, comparative analysis method, the method according to the sequence analysis time to perform analysis in research CHAPTER 2: BASIC THEORETICAL AND PRACTICAL EXPERIENCE ON THE LENDING ROLE OF COMMERCIAL JOINT STOCK BANKS FOR THE DEVELOPMENT OF SMALL AND MEDIUM ENTERPRISES 2.1 Small and Medium Enterprises Development and the Need for Commercial Joint Stock Banks for SME Development 2.1.1 Lending activities of joint stock commercial banks Lending is a temporary transfer of value from the owner (s) to the user (borrower), after a certain period of time returns to a value greater than the initial value (Nguyen Thi Mui, 2006) 12 * Characteristics of lending activity First, lending must comply with the following principles: i) Loans must have a purpose; ii) Repayment of principal and interest on time; iii) Loans must be secured in accordance with regulations Secondly, the parties involved in the lending business include borrowers, borrowers and state management agencies *) Lending activities of joint stock commercial banks JSB is one of the types of commercial banks but under the ownership of shareholders, Commercial banks have existed and developed hundreds of years associated with the development of commodity economy, The development of commercial banks has had a great impact on the development of the commodity economy, In contrast, the commodity economy has developed strongly to the highest stage of the market economy Commercial banks have also become more and more complete and become financial institutions that are indispensable Lending characteristics of commercial joint stock commercial banks: As in general lending activities, lending activities of commercial joint stock banks are a form of credit granting, whereby commercial joint stock banks give borrowers a sum of money to use for the purpose and time agreement with the principle of repayment of both principal and interest 2.1.2 Small and medium enterprises in the field of industry and construction SMEs in the construction industry are business establishments operating in the field of construction and business, which are registered in accordance with the law, divided into three levels: micro, small and medium scale Equivalent capital is equal to the total assets defined in the enterprise's balance sheet) or the average number of employees (total capital is a priority criterion) 2.1.3 The role of lending activities of joint-stock commercial banks for the development of SMEs in the industrial sector and construction 13 2.1.3.1 The concept of the role of lending activities of commercial banks for the development of SMEs in the field of Industrial & Construction From the author's point of view, the role of commercial joint stock commercial banks in SME development is the ability of commercial joint stock banks to change the development of SMEs in the field of construction & building.Thus, by allocating money to SMEs in the field of construction and civil engineering, a sum of money to be used for a certain purpose and time is agreed upon in principle with the repayment of both principal and interest, lending activities of commercial joint stock banks have transformed and promoted the development of SMEs SMEs in the field of construction and industrial works have more capital to expand production scale, change technology and technology, renovate product models, improve management and technical level, skills of workers;thereby, improve product quality, production cost savings, lower costs improve the efficiency of their manufacturing business That's it shown the role of commercial bank lending for the development of business 2.1.3.2 Characteristics of lending activities of commercial joint stock commercial banks for SME development in the field of construction and civil engineering First, lending reflects the relationship between the lender, the borrower and the society Secondly, borrowers are SMEswith the scale of small loans, the ability of business management is limited, in order to carry out their role, the joint stock commercial banks must link the loans with the manual and loan control Thirdly, the borrowers are enterprises operating in the field of construction and business, so the commercial banks' lending activities must pay attention to loans for renewing production technologies, renovating the product designs and raising the managerial skills and labor qualification of enterprise The content and factors affecting the role of commercial bank lending to the development of SMEs in the field of industry and construction 2.2.1 The content of active lending role of joint-stock commercial banks for the development of SMEs in the industrial sector and construction The role of commercial bank in lending and changing the size and growth 14 of SMEs in the field of industry & construction The role of commercial joint stock lending in changing SME structure in the field of industry & construction The role of commercial joint stock banks in raising the quality and efficiency of production and business of SMEs in the field of construction and industry 2.2.2 Factors affecting the role of commercial bank lending to the development of SMEs in the field of industry and construction Institutional environment for commercial bank lending shares, Lending capacity of JSCBs, the loan use capacity of SMEs 2.3 Experience the role of commercial bank lending activity for the development of SMEs in the field of Industrial & Construction in some localities and lessons for Nghe An Research presented the lessons of some banks in the world, which refers to the lessons learned by the Bank of Taiwan, South Korea's experience In addition, the research also presents practical experience of the role of lending activities of some commercial banks shares for developing small and mediumsized enterprises in the fields of industry and construction in one some Vietnam's local as Ho Chi Minh City, Quang Binh province Based on the analysis of the achievements, constraints and solutions that commercial banks in the world as well as localities in Vietnam have applied to draw lessons for the province of Nghe An to promote the role of lending activities of joint-stock commercial banks for the development of SMEs in the fields of industry and construction in Nghe An province CHAPTER 3: SITUATION OF LENDING ACTIVITIES OF COMMERCIAL JOINT STOCK COMMERCIAL BANKS FOR DEVELOPMENT OF SMALL AND MEDIUM ENTERPRISES IN THE FIELD OF INDUSTRY AND CONSTRUCTION IN NGHE AN PROVINCE 15 3.1.1 The development of SMEs in the field of Industrial & Construction in the Nghe An Province The number of enterprises in the field of industry and construction in the province of Nghe An tends to increase over the years in the research period, the increase in both quantity and quality of enterprises' activities has reflected accurately through their contribution to the overall economic development of the locality The number of SMEs in the field of industry and construction in Nghe An province increased from 36.25% to 38.29% of the total number of SMEs in the province Among SMEs in the industrial and construction sector, SMEs in manufacturing accounted for 38.72% of SMEs in the industrial and construction sectors in 2011 and the number of enterprises has increased to 41.47% and accounted for in 2016; With businesses in the construction sector accounted for 61.28% of small and medium-sized enterprises in the fields of industry and construction in 2011 and the number of businesses tend to decrease and accounted for 58.53% only 2016 3.1.2 Situation of lending activities of JSCBs in Nghe An province The mobilized capital of commercial joint stock banks is likely to increase in the period from 2012 to 2016, in 2015 and 2016, the number of mobilized capital will be increased by the joint stock commercial banks and banks public joint stock commercial, the addition of two branches in Nghe An of these two banks also facilitates the expansion of access to small and medium enterprises in the field of industry and construction in Nghe An province 3.1.3 Overview of the development of SMEs in the field of construction and industrial production and the role of lending activities of joint stock commercial banks in Nghe An province Firstly, in terms of loan size: Scale lending by commercial banks shares with SMEs in the fields of industry and construction in the province of Nghe An is relatively large, the number of SME clients is about 11% to 12% of the total number of clients (the largest is individual clients with about 80% of clients) In which the number of SMEs in the industrial sector and construction are customers of the joint-stock commercial banks account for about to 4.5% of customers are SMEs 16 The trend of commercial joint-stock banks for SMEs in the industrial and construction sectors has increased over the years in the research period The trend of commercial joint-stock banks for SMEs in the industrial and construction sectors has increased over the years in the research period Second, the cost of the loan: The cost of loans under assessment by enterprises is still relatively high, especially for SMEs in the field of industry and construction, which are characterized by large capital investment, time of capital recovery relatively longer than other firms operating in the service sector, Thus, the return of capital and payment of interest, the costs incurred for the process of borrowing from commercial joint stock banks of these enterprises is still relatively difficult Thirdly, on the lending business: The appraisal of production and business plans as well as the implementation of loan procedures for SME clients in the industrial and construction sectors are also emotional cases It also affects the borrowing activities of enterprises Fourthly, on loan conditions: Loan conditions are stipulated for each bank However, from the point of view of some selected enterprises, the conditions of the collateral as well as loan regulations are relatively difficult for businesses From the point of view of banks - they also carry out business operations; their goal is to seek profits and also to secure their loans, From the point of view of banks, enterprises can not borrow capital from banks because of weak financial capacity of enterprises; investment plans of enterprises have not met the requirements From the point of view of banks they also carry out business operations; their goal is to seek profits and also to secure their loans, From the point of view of banks, enterprises can not borrow capital from banks because of weak financial capacity of enterprises; investment plans of enterprises have not met the requirements 3.2.1 An analysis of the real situation of lending role of commercial joint stock commercial banks in developing the scale and speed of SME development in the field of construction and industrialization in Nghe An province 17 About changing the size of SMEs in the fields of industry and construction: the average capital scale of these enterprises have tended to increase during the period studied (2012-2015), while in 2012 the average amount of capital by enterprises is 17.6 billion by 2015, the average amount of capital of SMEs rose to 21.38 billion (an increase of about 4.2 billion on average per enterprise) Similarly, the average production value of SMEs in the industrial and construction sectors also tends to increase over the study period In 2012, the average production value per enterprise in this sector is about 19.82 billion and then increased by 6.85 billion on average to 26.67 billion in 2015, the average annual growth rate is about to 11% per year, which is a good sign for the development of enterprises in production and business activities with no significant impact from the capital SME loans in the field of industry and construction 3.2.2 Reality and role of commercial bank lending for the restructuring of SMEs in Industrial & Construction sectors in the province of Nghe An The research results of the author shows that the total number of SMEs in the industrial sector and construction has gradually increased over the years: in 2012 the number of enterprises in this field is 2253 now, 2015 increased were 2813 enterprises, an increase of 24.85% Regarding the structure of 2813 enterprises in the field of construction industry in Nghe An province, the proportion of small enterprises in the construction industry tend to decrease from 91.66% in 2012 to 88.8% 2015 The structure of the SME sector in the province has relative stability, the industry accounted for nearly 41%, and the sector accounted for about 59% of the construction Regarding the structure of technical level: of SMEs in the field of industry and construction in Nghe An province is mainly technical level at medium level However, there are variations according to the trend in percentage of qualified enterprises relatively modern and contemporary, reducing the proportion of enterprises with average skill and backward Specifically, in 2012 the proportion of enterprises with the modern level is 18 2.2%, and then by 2015 the proportion of modern enterprises was 5.2% in the total number of SMEs in this sector 3.2.3 Analyze the situation, the role of commercial bank lending and its impact to change the quality and efficiency of production and business activities of SMEs in the field of Industrial & Construction in the province of Nghe An The increase of outstanding loans of commercial joint stock banks has contributed to reduce the capital difficulties for enterprises, the average salary paid to their labor is also relatively high and also tends to increase in the research period when the salary paid by the company in 2013 is 5618 million, the figure in 2015 is 5745 million.The impact of lending activities of joint stock commercial banks on the improvement of the quality and efficiency of production and business activities of SMEs in the industrial and construction sectors is high and high, in other words they said that commercial banks' lending activities of major importance to improve the quality and efficiency of production and business of enterprises, the average score of 3.63 to 4.36 range from the average point score rated as points 3.2.4 A general assessment of the role of commercial banks in the development of small and medium enterprises in the field of industry and construction in Nghe An province 3.2.4.1 Impacts on the development of SMEs in the industrial and construction sector First of all, the lending activity of JSCBs increasingly contributes to securing capital for SMEs in the industrial and construction sectors.Second, thanks to loans of commercial banks; SMEs in the field of Industrial & Construction conditional improve the results of production and business activities 3.2.4.2 Impacts on the JSBs themselves when lending to SMEs in the field of industry and construction 19 The author's survey shows that in the years 2012-2015, the percentage of outstanding loans to customers are SMEs in BIDV's tendency to decrease slightly from 26.39% to 25.96%; The ratio of short-term loans from 30.15% to 28.14%; Long-term loans from 58.36% to 26.95% Overdue loans of SMEs are from SMEs, from 30.82% in 2013 to 55.11% in 2015; the ratio of nonperforming loans of SMEs is from SMEs 0.73% in 2014 to 0.6% in 2015 3.2.4.3 Implications for socio-economic development of Nghe An when joint stock commercial banks for construction and SMEs Table 3.21: Some indicators of lending activity of commercial joint stock commercial banks to SMEs in Nghe An province and socio-economic development of Nghe An province Contents 2012 2013 2014 2015 2016 28.284 35.888 44.088 51.383 56.213 59.812 51.078 54.566 58.282 58.606,9 13.266 11.138 12.551 13.326 14.579 6.251 6.890 7.250 7.695 8.406 4.1 Number of SMEs in the province 6198 6839 7.199 7.641 8.345 4.2.So of SMEs in Industrial & Construction 2.253 2.292 2.611 2.813 3.195 162.854 175.072 178.885 190.661 203.500 67.590 68.760 78.330 95.642 108.630 21,22 22,96 26 29 28,54 19,35 17.38 14.4 12.3 10.4 Debts of commercial joint stock commercial banks up to December 31 every year VND billion 2 Total products in the province (GRDP) Billion 3.3 Value of manufacturing and processing VND billion Number of enterprises in the province Number of employees working in enterprises In which the number of employees working in SMEs in Industrial & Construction Average income (Million VND) Poverty rate (%) per capita Source: Statistical Office of Nghe An province The number of enterprises in Nghe An province is likely to increase in the research period, in which the number of enterprises in the province in 2012 is 6215 by 2016 province about 8406 enterprises Along with that trend of the province, the relatively strong increase of small and medium 20 enterprises in the field of industry and construction, in 2012 the number of these enterprises around 2253 enterprises increased to 3195 enterprises in 2016 The number of small and medium enterprises in the industry and construction sector accounts for a relatively large proportion of the total number of enterprises in the province (about 37.76% of the total number of enterprises in 2016).The rapid increase in both quantity and quality of enterprises is supported by relatively large loans from commercial joint stock banks Loans from commercial joint stock banks have contributed to increasing production value, creating more jobs, increasing income of laborers, contributing to the state budget, thus contributing to solving the socio-economic problems of the province However, with the small size of loans, the short time of borrowing, the complexity of lending conditions, the role of commercial joint stock commercial banks in SMEs has limited contribution to socio-economic development of Nghe An province This is reflected in the low labor productivity in the province (the value of industrial production / labor is 14579 billion / 172975 labor = 84.28 million / year / labor), income Average per capita is not high (28.54 million dong / 12 months = 2, 378 million dong / person / month) 3.3 Cause limiting the role of commercial bank lending activity for the development of SMEs in the field of Industrial & Construction Nghe An province today The causes are related to the institutional environment and the level of socio-economic development in the locality Causes related to lending capacity of JSCBs: The scale of lending is still small due to the limited ability to mobilize capital, the high cost of lending, the lack of loans, the regulations and conditions of lending have not created conditions for SMEs to access loans The limited capacity and organizational structure of the Bank's staff are limited, and commercial 21 banks face many difficulties in accessing loans from SMEs in the field of construction and civil engineering in Nghe An province CHAPTER 4: DIRECTIONS AND SOLUTIONS TO ENHANCE THE ROLE OF COMMERCIAL JOINT STOCK COMMERCIAL BANKS IN THE DEVELOPMENT OF SMALL AND MEDIUM ENTERPRISES IN THE FIELD OF INDUSTRY AND CONSTRUCTION IN NGHE AN PROVINCE IN THE COMING YEARS 4.1 Background and directions to enhance the role of commercial joint stock banks lending to SME development in the field of industry and construction in Nghe An province in the coming years 4.2 Some major solutions 4.2.1 Improve the institutional environment The purpose of lending is to invest in additional capital for customers to meet the needs of production and business However, in order to expand the credit of joint stock commercial banks to SMEs in the field Industrial and construction successfully, one of the issues is concerned that lending should be implemented in accordance with the process, not ignore, not shut special attention to the project evaluation to have the best customer reviews 4.2.2 Improving the capacity of commercial joint stock banks One of the reasons SMEs in the field of industry and construction in Nghe An province find it difficult to access loans from joint stock commercial banks due to the difficulty of banks capital for lending activities therefore, the improvement of lending capacity of commercial joint stock banks is necessary In order to improve the lending capacity of commercial joint stock banks, some solutions are given as follows: To increase the lending capital of joint stock commercial banks Reduce loan costs and longer loan periods for SMEs in Industrial & Construction Improve the lending business of JSCB 22 Strengthen the inspection of the use of borrowed funds Improve the quality of credit human resources in relation to SMEs in the field of industry and construction through training, recruitment 4.2.3 Solutions on reducing bad debts and dealing with bad debts for joint stock commercial banks Reducing and dealing with bad debt is one of the solutions that are of interest and importance to banks in order to increase the lending capacity of joint stock banks without state capital, to control and dealing with bad debts of banks, some solutions are proposed as follows: First, strictly observe the lending process, regularly updated information on the client, perform the correct term debt, accordance with the production cycle of the customer business, performing the assessment, classification of debt to orient the level of risk and must be done immediately when the loan is considered, good grading, customer ratings, inspection and supervision after the loan Secondly, diversification of banking products and services should be diversified Thirdly, it is necessary to improve professional qualifications and quality education for staff directly working in the field of corporate credit Fourth, continue to actively monitor and recover principal and interest: Once the loan has been disbursed, the staff who directly performs the work related to the bank's lending activities should be responsible for periodically checking the repayment, urge the repayment of overdue debt as planned repayment without adjustment In addition, also need to strengthen and maintain the inspection, thematic monitoring of lending activities: Regularly check the compliance of lending procedures and procedures, promptly detect the existence, breach and gaps in lending activities in order to work out appropriate remedial measures 4.2.4 Improve access to and use of SME loans in the industrial and construction sector First, improve the ability of SMEs to access loans in industry and construction 23 Second, raise the capacity of small and medium enterprises to use loans in the field of industry and construction 4.3 Some recommendations CONCLUSION With the theme "The role of lending activities of joint-stock commercial banks for the development of small and medium-sized enterprises" thesis tackle the following issues: Based on a review of the research related to the topic of the thesis, the author has systematized the theoretical and practical basis for the role of commercial joint stock commercial banks in the development of SMEs in the industrial sector and construction, the experience drawn from Nghe An province comes from the local reality, the countries in the world From secondary data collected from published research, the province's final report and survey data of the author in 100 enterprises, 17 joint stock commercial banks and 180 state management officers and enterprises at all levels in Nghe An, authors used a statistical analysis method description for the role of commercial bank lending activity for the development of SMEs in the field of Industrial & Construction in terms of changes in the size, speed, restructuring production and contribute to improving the production efficiency of the enterprise business, although it is low impact.Stemming from these limitations in activities of commercial bank lending to SMEs in the field of T & XD and causes of these limitations, The thesis proposes the direction and solutions to enhance the role of commercial banks in the development of SMEs in the field of construction and civil engineering in Nghe An province in the coming years Toward the direction, in order to enhance the role and effectiveness of commercial banks' lending to the development of SMEs in the industrialized and construction sector, when considering capital requirements of the enterprise, both banks and enterprises need to pay attention to the demand for loans for direct expansion of production scale, as well as demand for loans to improve the management capacity of managers and leaders qualified employees; To prioritize loans for renewing production techniques, developing new professions, applying modern and environmentally friendly eco- 24 technologies First of all, the institutional environment should be improved, ensuring transparency in regulations on lending activities, lending procedures, loan regulations of SMEs with joint stock commercial banks; between commercial banks to state banks, the management bodies of the government and local authorities, there should be a coordination mechanism to manage lending activity is the conditions, the administrative procedures to resolve support support loans with preferential interest rates To improve lending, commercial banks need to take measures to strengthen equity through the issuance of shares and capital accumulation from profits; diversify products and services raise capital; To enhance cooperation with labor-intensive enterprises, non-business administrative units to provide products and services; Reduce loan costs and increase loan extension time for enterprises; improve the lending business of the JSCB; strengthen the inspection of the use of the borrower's loans; Improve the quality of human resources through the training, recruitment and appointment of bank managers At the same time, in order to improve access to capital, SMEs in industry and construction should take more responsibility for loans from joint stock commercial banks; It is necessary to renovate the financial management as well as to improve the capacity of using and managing the loans of the joint stock commercial banks, taking care to improve the skills and professional level for managers and employees of the enterprise To implement that direction and solution, The dissertation also recommends to the State Bank and People's Committee of Nghe An province with their responsibilities and powers in the forms, measures to support the lending activities of commercial banks for the development of small and medium enterprises in the field of industry and construction in the most effective way  ... commercial banks for SME development In fact, the target audience of commercial banks in general and commercial joint stock banks in particular, an important customer segment is SMEs, and credit loans... industry and construction in the Nghe An province (Currently in Nghe An province: branches of a state-owned commercial bank and three state owned commercial joint stock banks; 22 branches of... from time series data And the advantages and difficulties of SMEs in particular and business in general when accessing credit loans from banks Petersen and Rajan (1997) conducted their first study