LUẬN văn xây DỰNG CHIẾN lược PHÁT TRIỂN DỊCH vụ THANH TOÁN QUỐC tế tại NGHÂN HÀNG PHÁT TRIỂN VIỆT NAM

GRIGGS UNIVERSITY GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM LUẬN VĂN THẠC SĨ XÂY DỰNG CHIẾN LƯỢC PHÁT TRIỂN DỊCH VỤ THANH TOÁN QUỐC TẾ TẠI NGHÂN HÀNG PHÁT TRIỂN VIỆT NAM CAPSTONE PROJECT REPORT BUILDING THE STRATEGY TO DEVELOP INTERNATIONAL PAYMENT SERVICES IN VIETNAM JOINT STOCK COMMERCIAL BANK FOR INDUSTRY AND TRADE Group Number: 09 Class: GaMBA01.X0310 Student’s name: HANOI: 2011 NTRODUCTION The necessity of topic In the trend of strongly internationalizing international economy, Vietnam’s economy is step by step integrating the regional and international economy On January 11th 2007, Vietnam officially became the 150th member of World Trade Organization (WTO) This was an important event which opened the opportunities as well as the challenges to Vietnam’ economy so that it integrates in the international economy deeply and widely, continuously promoting the industrialization and modernization of country The development of foreign trade and international investment require the nonstopping development of payment, currency relation and international banking services The commercial banks play role as the bridge connecting the above economic relation Export-import payment is one of the important professions of commercial banks The good operation of export-import payment activity of commercial banks contributes to the promotion of business of Vietnam’ enterprises, in particular, and Vietnam’s foreign trade, in general The export-import payment brings the great benefits to the commercial banks External the service fees, commercial banks also develop other professions such as foreign currency profession, export-import financing profession, and international guarantee profession, etc Besides, since April 1st 2007, to implement the process under the commitment when Vietnam joined WTO, the foreign banks are able to establish the sub-bank with 100% foreign capital in Vietnam This brought the Vietnam’s commercial banks in general and state commercial banks in particular in great threats and challenges of competitiveness in Vietnam The competitive pressure for State GaMBA01.X0310 - Group Page commercial banks is not only from the foreign banks, but also from the joint stock commercial banks Therefore, although the market share of state banks still dominates the market, the decrease of market share in this bank block is considered as a dispensable movement Facing to this pressure, in order to survive, develop in competitiveness and well the role of economy’s bridge, Vietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank), one of the big commercial banks, considered the export-import payment activity as one of the important tasks in upcoming years To survive and develop, Vietinbank need to build a strategy The building of suitable strategy has extremely important meaning; the timely strategy direction and adjustment is the foundation for great benefits of enterprise Understanding the importance of building the business strategy of enterprise as well as the development of Vietinbank in the integration, our group did research and chose the topic: “Building the strategy to develop international payment services in Vietnam Joint Stock Commercial Bank for Industry and Trade” to be research target and hope to choose a right direction for Vietinbank in the future International payment services can be considered as a strategic business unit (SBU) of VietInBank because of the following reasons: - VietInBank just established an International Payment Transaction Office for international payment services which is located in Cua Nam Street, Hanoi This Office is independent and fully functional as both cost and profit center of VietInBank - VietInBank has fully delegates authority and responsibility The International Payment Transaction Office to a senior executive who reports directly to the General Director of VietInBank Purposes of research - Systematize the theories and methodology about business strategy of enterprise GaMBA01.X0310 - Group Page - Build the Letter of Credit – L/C service product business strategy for international payment services - Define target and propose solutions to develop Letter of Credit – L/C service product businessthat SBU Scale of research - The theories about business strategies of enterprise - Building the international payment service product business development in Vietinbank and solutions, detailed methods to implement the business strategy Method of research Group does research based on the knowledge to evaluate all the results of international payment service product business of Vietinbank Otherwise, we also use methods of statistic, analysis, predictability and collection based on the collected data to analyze the service business of bank and propose the business strategies for Vietinbank in integration condition Structure of report External the introduction, conclusion and reference, main content of the report includes chapters: - Chapter 1: Several basic theories on business strategies - Chapter 2: Real situation about activities of doing business the international payment service products in Vietinbank - Chapter 3: Targets and solutions to develop the international payment service products business in Vietinbank GaMBA01.X0310 - Group Page CHAPTER 1: INTRODUCTION OF BUSINESS STRATEGY AND INTERNATIONAL PAYMENT SERVICE 1.1 General introduction about business strategy 1.1.1 Definition of business strategy Business strategy is researched by a lot of economist and they have bought out many definitions of the term “business strategy” like: Business strategy is the art: - Alain Threlart assumes that “The strategy is the art that enterprise uses against competition and wins” - M.Porter thinks that “The strategy is the art setting up steady competitive advantages to defend” - Hence, those authors believed that business strategy is a type of art to compete in market and develop enterprise According to concept in management aspect, business strategy is a type of plan - G.Arlleret thinks that “Strategy is defining ways and means to reach established targets through policies” - D.Bizrell and the author team assert that “Strategy is likely a general plan directing and orienting enterprise towards expected goals It is the basis to form policies and operating methods” - Gluecl assumes that: “Strategy is a consistent, comprehensive, and genera kind of plan which is designed to ensure performance of enterprise’s goals According to concept of combining unity: - “Business strategy is the art of combining and controlling activities to get long-term goals of enterprise” - Chandler considers strategy consists of defining long-term basic goals of company; selecting measures or action process; distributing essential forces and carrying out those targets GaMBA01.X0310 - Group Page In business, “Business strategy is the art of designing, organizing means to reach long-term goals of company and it connects with changes of business and competitive environment” 1.1.2 Attributes of business strategies - Business strategy identifies basic goals and management direction of enterprises in each period - Business strategy is oriented in order to ensure the continuous and constant development for firms in highly fluctuated financial environment - Business strategy is the guarantee for the maximum mobilization and optimal combination of exploitation and utilization of firm’s resources in current and future Therefore, it can encourage competitive advantages in long run - Business strategy of firms is reflected during the continuous process from the building plan step to implementation step and supervision step - Business strategy is often the offensive strategy It is established and built up on the basis of detecting and taking advantages of business opportunities, competitive advantages of firms to gain the highest operation efficiency - Business strategy is built up through a long period of time (3.5 to 10 years) Therefore, business strategy has characteristics of long term tactic and is specified in short term strategies, which are also called plans 1.1.3 Role of business strategy According to modern business strategy, it is incapable to hedge changes of market without specific and flexible business strategy, which is really offensive Only by this way, firms can detect worthy opportunities or risks in order to give out suitable policies Lack of business strategy, firms is unable to run its business effectively, even lead to bankruptcy Therefore, business strategy has really important role in the operation and development of a business: - Business strategy helps business determine clearly its purpose, direction as a basis for its all business activities GaMBA01.X0310 - Group Page - Business strategy helps business reach financial chances and, simultaneously, have active measures to overcome risks and threats from competitive market - Business strategy contributes to the increase of the efficiency of using resources, consolidates competitive position of firm, ensures for its constant development in the future - Business strategy creates solid base for giving policies and determining suitable business activities to market fluctuations 1.2 Process of building business strategy 1.2.1 Analysis of business environment Analysis of business environment of firms is the process of considering different environmental factors and determining influential level of opportunities and threats to firm The expectation is based on reliable analysis and assessment basis in order to take advantages of opportunities or to be active with financial and business risks to firm Source: Strategic Management: Concepts and Cases (12th Edition) Fred R David Figure 1.1: P.E.S.T Model GaMBA01.X0310 - Group Page 1.2.1.1Macro environment Economic environment: Macro environment is a really important factor which can not be ignored by strategy planners It changes create different opportunities as well as threats to each firm in different fields Environmental positions of macro environment are the main decisive factor and become the power of the whole economy: - Growth rate of economy: indicates the economic variation by the time Marx says that economic circle includes steps: Crisis – Recovery – Depression and Flourishing When the economy is in the depression or crisis, income of residents decreases, consumption decreases and production is loss This is a difficult period to firms Vice versa, in the economic upward, enterprises have many opportunities to expand their scale and develop - Interest rate: is one of monetary factors and is the typical factor which every firm makes concern Both high or low interest rate affect directly to business and market demand because it is the contributing factor of firm’s cost Interest rate fluctuation is influenced dramatically by the monetary policy of the Government - Exchange rate: always has direct effect on activities of enterprises with foreign elements such as import – export enterprise, enterprises using direct or indirect foreign input or output The change of exchange rate directly affects the company competition in the international market - Inflation: is always threat to business activities One of bad effects inflation to the whole economy is that it can decrease the stability of the economy and reduce economic growth In long run, inflation reduces investment efficiency of firms and brings hidden risks, thus, businesses develop slowly, growth rate of economy is negatively affected Politic and legislation environment: Politic and legislation factors affect developing strategy of enterprises in different directions They may be opportunities to this firm but in contrast, be disadvantage to other firms Stable politic brings good condition for developing GaMBA01.X0310 - Group Page economy, vice versa, unstable politic will have negative influences on economy Besides, running in an economy which are adjusted by strict law system, enterprises may face both advantages and disadvantages because a clear and full law system will create healthy competitive environment and be a foundation for an attractive environment in the future One of the typical trends in recent years is the redirection to deregulation The eradication of exhibitions and regulations makes the import barrier become lessen and creates an intensive competition in some fields of industry In addition, the policy of encouraging various economic elements to include actively in business activities is the risk for state owned firms but the great opportunity for private enterprises because they can participate in the market more conveniently and easily Technical environment: Technical progressions have influence on many aspects of the whole society These impacts are through products, technical process and new materials Directions and fluctuations in technology may be chance for enterprises which are able to mobilize capital quickly and effectively, but vice versa, it is threat for firms fixed with old technologies and slow to adjust One of the most important effects of changing technology is on barriers of import and export and the restructuring thoroughly sector’s structure as well as on the creation of new jobs According to M Porter, technological change is not important to technological benefit itself, but it is important if it impacts on competitive advantages and sector’s structure On the other hand, the development of technology will shorten product circle, thus, firms should pay attention to the trend of technological innovation Every firm has relation with many different and related kinds of technology Its business activities also have that various relation Therefore, an technology is very important to competition if it impacts on firm’s competitive advantages or on structure of financial sectors Cultural and social environment: GaMBA01.X0310 - Group Page Cultural values and social attitude build up the foundation of society, thus, it often results in changes in conditions of technology, politic – legislation, economy and human Cultural and social environment may affect on strategic decisions such as: selecting fields and item of goods, selecting brand name, color, form distribution channels Social change in concept of life meaning and consumption meaning also brings opportunity as well as threats to firms Natural environment: In comparison with economic, politic, cultural, social, technological factors, effect of natural factor is very difficult to expect The fluctuation of natural factors such as climate change, flood or disasters is always hidden risks to enterprises, especially those which have direct relation to natural environment like agricultural enterprises International environment (globalization): In the condition of strong globalization happening all over the world recently, the internationalization is not an option but an inevitability Issues of globalization affect dramatically on operating and business activities of enterprises in every aspects such as output market, input sources, finance, human resource… Globalization brings many great benefits for enterprises, however, it also consists some complex issues due to graphical scale and differences of cultures, societies and politics 1.2.1.2 Business sector environment Business sector environment includes all factors which directly influence decision making of firms in one sector A business sector consists many firms which have supplement or substitute products or services, so the concern is how firms analyze and expect competitors in its business sector in order to identify opportunities as well as risks The following is a popular model of Michael Porter with competitive forces Five main factors affect to company’s operation as: potential rivals, suppliers, customers, current rivals and substitute products The below table will indicate the affection of these factors to company GaMBA01.X0310 - Group Page - Maintain and expand market - Develop trade mark - Promote advantages to increase competitive capacity Determine strategy 2: Set up market, expand effective trading system, promote competitive advantages WO strategy: Make use of opportunities to recover weaknesses - Invest to the technology renovation and modern banking products - Set up market and Marketing work Determine strategy 3: Invest to the technology renovation and modern banking products WT strategy: Mitigate weaknesses to avoid threats - Pay attention to research and develop advanced as well as modern products - Increase the quality of officer training to meet the development, technology and integration requirements - Expand the effective trading system and promote competitive advantages Determine strategy 4: Increase the quality of officer training to meet the development, technology and integration requirements 3.2.2 Choosing strategy via GREAT matrix By means of using GREAT model, we select the optimal trading strategy by means of evaluating and analyzing as well as marking criteria as following steps: Step 1: Mark each strategic project according to level of 1-4, and criteria as:  G: More and more gain of business is, the higher and higher of score  R: More and more risks of business are, the lower and lower of score  E: The bigger and bigger expense of strategy is, the lower and lower of score  A: The higher and higher achievable of strategy is, the higher and higher of score GaMBA01.X0310 - Group Page  T: More and more suitable time of strategy is, the higher and higher of score Point = high; Point = good; Point = average; Point = bad; Point = weak Step 2: Connect weight for evaluation criteria basing on the importance to trading operations of business  Criterion 1: Gain 0,30  Criterion 2: Risk 0,15  Criterion 3: Expense 0,15  Criterion 4: Achievable 0,20  Criterion 5: Time 0.20 Summarize score for each strategic project to select optimal strategy The result of strategy evaluation of Vietinbank is demonstrated as following: Table 3.1: Strategy analysis according to GREAT model Criteria Weigh t Strategy Strategy Strategy Strategy 1-Gain 0,30 Evalua -tion 2-Risks 0,15 0,45 0,45 0,30 0,30 3-Expense 4Achievebl e 0,15 0,75 0,60 0,75 0,45 0,20 0,80 0,80 0,80 0,80 5-Time 0,20 0,80 0,60 0,80 0,60 Sum: Resul t 1,50 Evalua -tion Resul t 1,50 Evalua -tion Resul t 1,50 Evalua -tion Resul t 1,50 4,30 3,95 4,15 3,65 Source: Evaluation of experts in Financial Banking sector Therefore, strategy is the most highly appreciated This strategy diversifies Letter of credit payment method, considers the differentiation in product and product quality as value GaMBA01.X0310 - Group Page To implement above strategies, Vietinbank needs to operate following solution groups 3.3 Solutions to apply strategy to develop international payment service in Vietinbank 3.3.1 Diversify international banking services Generally speaking, VietinBank is quite young compared with large commercial banks in the world As a result, operation experience and technique of VietinBank is quite simple Therefore, it is necessary for VietinBank to learn and absorb experience, banking business technique in general and payment technique in particular of those large banks Besides traditional international payment methods by Letter of credit, other modern ones are currently used in international financial market like FACTORING and FORFAITING, which have not been popular among banks in Vietnam 3.3.2 Enhance Trade finance Service In order to develop and expand international payment business and face the competition of foreign banks, it is required that VietinBank have to innovate actively many business sectors, especially finance for import and export activities of companies Funding for import and export companies is an effective tool for Vietnamese company to improve their status in international commercial negotiation, take more initiative in giving efficient payment condition, thus, banks are able to boost their international payment business The more foreign trade develop, the more various payment methods are, which leads to the variety of finance patterns for import and export activities, one payment method requires one relevant finance patterns The more advantageous the foreign financial operation is, the broader the commercial relation becomes Quality of this business is the base to build trust with commercial partners, facilitating the international goods circulation Thus, VietinBank need to: GaMBA01.X0310 - Group Page - Apply broadly Forward transaction for companies that use export L/C and have good reputation in exporting traditional goods - Provide credit limit to customers, especially regular ones - Provide loan to invest in manufacturing and processing for export to both effectively use mobilized capital and enhance customer relationship to expand and improve international payment business - Implement broadly negotiation activities for clean documents with letter of credit By dint of the preeminence of clean document negotiation, exporters are able to receive money soon after delivery and continue with other business cycle In order to attract customers, it is irrefutable that Vietinbank should increase expertise in international payment and implement it extensively 3.3.3 Effectively expand agency network and build a suitable foreign deposit structure In fact, agency relationship is relationship between one local bank and one foreign bank, becoming agency for each other on the mutual benefit basis Two parties will exchange confident documents to process transactions like: signature sample, telex code, Swift code… In international payment business, agency network is crucial for effective implementation The fact has shown that, if one bank has agency relationship with many banks in the work, this bank will be able to take advantage of international payment business Creating and expanding agency relationship with foreign banks is strategic for international payment development in commercial bank Hence, in the coming time, VietinBank could be more proactive to build up agency relationship with banks at countries where Vietnam has already started trading, to support for economic integration with nations in the world In addition, to ensure highly beneficial international payment business, VietinBank should balance the foreign currencies reserved in other banks that often GaMBA01.X0310 - Group Page have payment transaction with it, and calculate the proportion of each type of currency to meet the demand of payment in different currency of companies 3.3.4 Improve management and develop international payment methods, especially after sight Letter of Credit (L/C) The lack of knowledge about international payment of import and export companies has caused a lot of financial risks for businessmen and banks Thus, VietinBank need to manage and take advantage of international payment methods, especially guarantee for companies to open after sight L/C By virtue of characteristics of after sight L/C, customers often deposit only a small ratio compared with L/C value When it expires, customers will put money into their account to pay to foreign partner In the time before L/C expires, customers can use the capital for other business cycles However, if customers operate inefficiently, use loan for the wrong purposes and fail to make payment, the bank have to give make this payment to maintain reputation and international transaction Some customers, who not knowledge about international payment, delay in payment and find excuse to refuse payment obligation with the Bank, as a result, the Bank has to delay payment for foreign bank and its reputation will be damaged Some others accept bill of exchange and the documents sent by the bank without careful check in the duration of working days as defined in UCP and keep this documents for a long time and try to avoid paying to the bank when goods is insufficient or not delivered This will cause dispute between customers and the bank and between bank and bank Moreover, foreign exchange rate fluctuation also affect the payment of after sight L/C as at the time of payment, Vietnam Dong devaluates, USD revaluates, companies import and then sell good in Vietnam Dong and deposit it to the bank In order to protect reputation, the bank must sell foreign currency for customers to pay to foreign partners If the bank cannot balance foreign exchange reserves, it has to delay payment, which harms its reputation and reduce opportunity to compete in international market, and even be charged with high interest for delay GaMBA01.X0310 - Group Page International payment business has been developed with complicated new technique and sophisticated traps in commercial transaction VietinBank should pay attention on strict management to reduce risk in using L/C after sight like following: Propose specific regulations on after sight L/C process based on promulgated circular of State Bank of Vietnam In case VietinBank have enough capital for shortterm loan, it should consult customers to accept loan to open L/C at sight in order to avoid high interest rate for foreign entities and help the Bank prepare payment capital In general, after sight L/C should be limited as it is one of the reason for big debt burden in the future Have comprehensive policies to boost service quality like customer policy, credit policy, international payment policy, deposit for L/C and planning to balance foreign exchange reserves to ensure capital to pay for foreign partner when needed When open after sight L/C, it needs to consider carefully type of goods, circulation and consumption cycles and ability of business units to request customers to secured activities like: deposit in foreign exchange, use asset as collateral, goods, Third party’s Guarantee for the Importer 3.3.5 Increase the efficiency of using international payment method in import and export system To a certain extent, exporter should require L/C to be opened by prestigious international bank, especially when L/C is issued in a bank in a risky countries In the last few year, some foreign bank often open L/C with additional condition which help them avoid a part of or a whole of commitments which they should take the whole liability If the conditions in L/C define that payment is subject to the “good will” of applicant or other factors, the commitment of issuing bank will be invalid For example, the acceptance of applicant or government of importing countries or prior approval of State bank of Vietnam in providing foreign exchange or payment is made after receiving money from Third party is required Avoid L/C with conditions that cause payment delay, complicated document creation or even difficulty in creating suitable documents L/C should be negotiable GaMBA01.X0310 - Group Page at the transaction offices of exporter’s bank Avoid L/C that only allow paying at the transaction offices of issuing bank (often occur in German and some other European countries) Do not accept L/C that overuse the condition of repay authority for other branches of issuing bank at third country, even at US (or often saw at Korean market) since it will take long time and expense for claiming and sending documents 3.3.6 Solution group about increasing quality of human resources Recruiting officers needs paying attention to trained profession standard, training quality, and graduation level The following is foreign language, information level, communication and behavior capacity In the context of integration and competition of service operation in locals, officers are required to have standard, skill, experience and good communication capacity Training, practicing profession have to connect closely to service product as profession and service product have the same content with different approaches The objective of this solution is to make officer get used to accessing service product Evaluating officers closely to their gained achievements with transparent commending and rewarding, clear treatment system for good officers and the ones being loved and praised by customers Having polices to attract talents with capacity in service operation from other banks, industries and graduating from national and international universities about Agribank The attractive policies mainly focus on treatment policy, compensation policy and creating favorable conditions Periodically organize the examinations for testing and profession in providing customers, transacting with customer procedure among officials in all systems Having mechanism to encourage officials improving standard, completing profession and increasing service quality 3.3.7 Solution group about Marketing management GaMBA01.X0310 - Group Page Marketing has particularly important role, therefore, apart from increasing quality and quantity of service product, Vietinbank should promote this operation by many forms regarding as: propagandizing, advertising in public communication media, increasing the donor activities to popularize trade mark and deploy current as well as potential customers Thus, Vietinbank should implement some solutions as following: Firstly, providing service: More and more divided demand of customers together with the socio-economic development make customers require the most suitable services Therefore, the bank has to always research and survey the demand and hobby of customers as well as find out service renovation to create reputation and be leading position in renovation as well as outstanding difference in comparison with other Secondly, setting up the relationship with customers and internal bank: One of important factors in developing banking services is the responsibility awareness as well as skillfulness of officials communicating to customers, supporting ones during the process of supplying services and manager levels Therefore, apart from communicating with customers, the bank has to communicate inside and well coordinate among different departments of system with the aims of organizing and managing production process as well as service supplying homogeneously Service is invisible, so the communication has an important role in setting up prestige as well as increasing awareness of service quality of customers It is difficult to evaluate and recognize services, so introducing about service is not enough, officials have to give evidences about providing services Furthermore, the bank can illustrate service by the skillfulness, uniform of officers, service supplying environment and other policies The bank not only communicates by traditional means but also can use all of visible things connected closely to service production and supplying process to transact with customers The invisibility makes the oral information have important role Since customers usually believe in experience of previous ones in comparison with visible GaMBA01.X0310 - Group Page products Provided information has to be designed in order to ensure the reality and clarity with the aims of increasing the satisfaction of customers and fostering the image about quality and services of the bank 3.4 Process to apply strategy solution to develop international payment service in Vietinbank The two main strategies chosen to improve internal payment service in Vietinbank are: product diversification strategy and improve quality of internal payment service by providing professional products To apply these strategies the bank need to apply eight above comprehensive solutions To ensure the efficiency of these strategies Vietinbank separated its applying process into big phases with below action and timeline: Table 3.2: Summary process to apply strategies to develop international payment service Action Purpose Phase 1: Expanding business corporation Learning experience, technique Expand new market - Finding new cooperators Consolidate capital - Expand agent network Attract more customer Phase 2: Improve quality of international payment service - Improve management method Improve competitive ability Improve knowledge about - Human resource training international payment service Forecast market changes Finding new customers - Setting up international payment marketing dept Building customer's loyalty Time 20122014 20122016 2012 20122013 2012 Made by Customer relation dept Head office Head office HR section International payment dept The process summary main activity for each section to implement the bank main objectives in developing international payment service: Diversify international payment services and improving quality of this activity The process shows out the time line and responsibility for each section in applying the bank’s strategy They are general process for all section in the bank to apply in the next few years To be GaMBA01.X0310 - Group Page successful in developing international payment service of Vietinbank the bank need to study more detail the action and plan for each section in internal system With these general strategies will be the guidance for all sections to find out their own strategy in the future CONCLUSION Together with meaningful trading strategy in the business development orientation, right trading strategy will promote resources of business and adapt to influences from external environment It plays as guideline for trading operations of business during the development process Basing on analysis and trading strategies of Vietinbank, we hope that Vietinbank will have a sustainable development strategy in the context of integration, increase competitiveness in market From that, Vietinbank will be multi-function bank, focusing on developing modern banking services and products apart from traditional banking procedure Internatinal payment Service service product is one of potential trading sector and indispensible as well as suitable trend with integration and development process of banks in region and all over the world At last, we hope to receive the remarkable contribution of teachers, manager board of Vietinbank, therefore, the capstone report can give real solutions for developing letter of credit service in Vietinbank in the context of integration Thanks and best regard./ GaMBA01.X0310 - Group Page REFERENCES Vietnamese documents: (1) Harvard Business Essentials, Effective trading strategy, Ho Chi Minh City Comprehensive Publisher (2) Michael E Porter (2009), Competitive strategy, Youth Publisher (3) Vietnam Joint Stock Commercial Bank for Industry and Trade, annual report over years (4) Vietnam joint stock commercial bank for foreign trade of Vietnam, annual report over years (5) Bank for Investment and Development of Vietnam, annual report over years (6) Vietnam Bank for Agriculture and Rural Development, annual report over years (7) Vietnam State Bank, annual report over years (8) Vietnam State Bank (2005), Banking service development strategy to 2010 and vision to 2020, Eastern Publisher, Hanoi (9) Meritorious teacher -Doctor Nguyen Thi Minh Hien (2003), Banking Marketing Curriculum, Statistics Publisher, Hanoi (10) Associate Professor.Doctor Le The Gioi – Doctor Nguyen Thanh Liem – Master Tran Huu Hai (2009), Strategy Management, Statistics Publisher, Hanoi (11) Associate Professor.Doctor Ngo Kim Thanh, Business Strategy (12) Associate Professor.Doctor Nguyen Ngoc Son, Strategy Management Curriculum, Vietnam Education Publisher English documents (1) ADB, Commercialization and Poverty Reduction, 2008, page – (2) Jay Barney; William Hesterly (2008), Strategic Management and Competitive Advantage: Concepts, Prentice HallJay Barney (2007), Gaining and Sustaining Competitive Advantage, Prentice Hall GaMBA01.X0310 - Group Page (3) Herrington Bryce ( 2007), Financial and Strategic Management for Nonprofit Organizations: A Comprehensive Reference to Legal, Financial, Management, and Operations Rules and Gu, Jossey-Bass Nonprofit & Public Management Series (4) Porter M On Competition Harvard Business Review Boston 1998 (5) Porter Michael (1990); The Competitive Advantage of Nations London (6) Robert E Ankli, Michael Porter’s competitive advantage and business history, University of Guelph, 1992, trang 288 – 300 (7) Porter M, The competitive advantage of Nations, Harvard Business Magazine, March 1990, page 73 – 93 (8) Fred R.David (2008), Strategic Management: Concepts and Cases (12th Edition) (9) Schmuck Roland (2008); “Measuring Company Competitiveness”; Proceedings Papers of Business Sciences: Symposium for Young Researchers (FIKUSZ) 2008.Trang: 199-208 Budapest Tech Keleti Faculty of Economics Website: (1) www.vietinbank.vn (2) www.agribank.com.vn (3) www.bidv.com.vn (4) www.vcb.com.vn (5) www.sbv.gov.vn (6) www.vneconomy.com.vn (7) http://my.opera.com - GaMBA01.X0310 - Group Page APPENDIXES APPENDIX 1: CURRENT LC SERVICE FEE IN VIETINBANK SYSTEM FEE FEE NO (Excluded VAT) CONTENT FEE LEVEL MIN MAX LETTER OF CREDIT Export B401 1.1 LC notice 20 USD B402 1.2 LC revision notice 15 USD B403 1.3 LC notice and receive document from issuing bank 15 USD + requirement fee of issue bank B404 1.4 Payment for one document set B405.11.5 LC certification 0.18% 1.6%/year B405.21.6 Revise and expand effective date 1.6%/year/additional amount and/or expansion time B405.31.7 Other revisions 20USD 500 USD 50USD 20USD 20USD 1.6 LC transfer B406 - Domestic 40 USD B407 - International 50 USD B408 1.7 Document processing 20USD B409 1.8 LC cancellation notice 15 USD + tele fee B410 1.9 Document making fee 30 USD GaMBA01.X0310 - Group Page Import B411 2.1 Issuing LC B412 2.2 Issuing revision LC amount B413 2.3 Issuing other revisions B414 2.4 LC cancellation B415 2.5 Accept bill deferred (No apply for deferred LC with shorter payment time 30 days or 30 days after sight) B416 2.6 Payment for a document set 0.15%/ L/C amount 50 USD 300 USD 0.15%/ additional amount L/C 20 USD 300 USD 15 USD /time 15 USD 1.2%/year /bill amount 20 USD 500 USD 0.2% of a transaction 30 USD 500 USD B417 2.7 LC payment commitment fee 0.05%/ month B418.12.8 Cargos receiving guarantee 50 USD B418.22.9 Revise cargos receiving guarantee 15 USD 30 USD 2.10 Penalty for overdue LC B419 - Within 60 days B420 - More than 60 days Free 0.1%/month/ LC amount B421 2.10 Bill of lading Endorsement USD B422 2.11 Document processing Transfer LC to second notice bank B423 10 USD 15USD GaMBA01.X0310 - Group 50 USD Page APPENDIX 2: VIETINBANK’S BUSINESS RESUL IN 2010 Target Unit 31/12/2010 Compare with 2009 Total asset Billion VND 367,712 151% Capital Billion VND 15,173 135% Equity Billion VND 18,372 146% Attracted capital Billion VND 399,699 154% Loans balance Billion VND 234,204 143.60% Profit after tax Billion VND 4,598 136% Capital safety index % 8.02% ROE % 22.10% Bad debt ration % 0.66% Source: Vietinbank annual report 2010 GaMBA01.X0310 - Group Page ... process under the commitment when Vietnam joined WTO, the foreign banks are able to establish the sub-bank with 100% foreign capital in Vietnam This brought the Vietnam’s commercial banks in general... Indovina Bank (the first joint-venture bank in Vietnam) - Vietnam International Leasing Company – VILC (the first financial leasing - company in Vietnam) Vietinbank Insurance Company Ltd It sas established... opening banking-finance service of Vietnam within WTO, Vietnam has to open the bankingfinance strongly in the upcoming years The commercial banks of Vietnam in general and Vietinbank in particular