LV thạc sỹ_Credit risk management of Agribank

FOREWORD From the point of view of economic growth and development, Vietnam has achieved significant progresses in the last two decades The living standard has been improved remarkably and the national social and economic achievements are obviously quite impressive One of the main drivers of the economic growth and development is economic reform, initiating the transformation from the centrally planned economy into market economy with socialist orientation The financial sector plays a key role in the efforts to reform Vietnam’s economy; the formation of a market-oriented financial sector has significantly improved capital mobilization, diversification of banking services and reasonable allocation of different economic resources The current and future financial reforms are expected to bring in deep changes that will create a more suitable economic management model in Vietnam The banking system, as the blood vessel system of the economy, always plays a very critical role Vietnam’s banking system in recent years has achieved encouraging results such as contributing to the stability of and restraint on inflation and the effective implementation of the national monetary policies… However, under the market economy, business risks, particularly banking risks, are unavoidable since they may result in domino effect, widely spread with increasingly sophisticated symptoms The collapse of the banking system may have negative impact on the whole socio-economic and political life and may expand past the boundaries of a nation to reach a regional, or even the global scale Given the integration trend, banks and financial institutions must always cope with competition and many different types of risks In Vietnam, since the starting point of local banks is quite lower than that of the regional average, development and profit are given the highest priority This leads to the situation that risk management of Vietnam’s local banks is almost ignored without adequate and professional investment That’s why bad loans and other problems due to uncontrollability have not been addressed in almost all local 1|Page