LV Thạc sỹ_Current situation of mobilizing activities in BIDV and solutions for improvement

1 ACKNOWLEDGEMENT I wish to express my thankfulness to Associate Pr … for having instructed me throughout my research I also want to say thanks to the employees of customer relationship department for sharing me so much information regarding the branch and the whole organization Especially, I want to express my thankfulness to Mr…, who have been directly supervising and helping me during my internship department TABLE OF CONTENTS ACKNOWLEDGEMENT .1 TABLE OF CONTENTS LIST OF TABLES LIST OF FIGURES ABBREVIATIONS CHAPTER 1: Introduction 1.1: Rationale 1.2: Research question .9 1.3: Research methodology .9 1.4: Research scope 1.5: Research structure CHAPTER 2: Theoretical background of mobilizing funds 10 2.1: Overview of commercial bank’s funds 10 2.1.1: Definition .10 2.1.2: Classification of capital .10 2.1.2.1: Equity .10 2.1.2.2: Mobilizing capital .10 2.1.2.3: Borrowing 13 2.2: Capital mobilizing activity of commercial bank .15 2.2.1: Definition .15 2.2.2: General orientations for capital mobilization .15 2.2.2.1: Economic direction 15 2.2.2.2: Technological orientation 16 2.2.2.3: Psychological orientation 17 CHAPTER 3: Current situation of capital mobilization in Bank of Investment and Development of Vietnam, Hanoi branch .24 3.1: Overview of Bank of Investment and Development of Vietnam, Hanoi branch 24 3.1.1: The foundation and development of BIDV, Hanoi branch 24 3.1.2: Organizational structure of BIDV, Hanoi branch 25 3.1.3: Major activities of BIDV, Hanoi branch 25 3.1.4: Business performance of BIDV, Hanoi branch from 2008 to 2011 27 3.1.4.1: Mobilizing activity 27 3.1.4.2: Lending activity 30 3.1.4.3: Service 32 3.1.4.4: Operating activity .33 3.2: Current situation of mobilizing funds in BIDV, Hanoi branch 35 3.2.1: Fund mobilization performance of BIDV, Hanoi branch from 2008 to 2011 35 3.2.1.1: Structure of capital mobilization by clients .36 3.2.1.2: Structure of capital mobilization by maturity 38 3.2.1.3: Structure of capital mobilization by currency 40 3.2.1.4: Structure of total working capital by source .42 3.2.2: Evaluations on the current performance 44 3.2.2.1: Achievements of BIDV, Hanoi branch in mobilizing activities from 2008 to 2011 44 3.2.2.3: Limitations of BIDV, Hanoi branch in mobilizing activities from 2008 to 2011 45 * Reasons for limitations .46 CHAPTER 4: Solutions to improve capital mobilization activity in BIDV, Hanoi branch .51 4.1: Capital mobilization orientation for BIDV, Hanoi branch 51 4.2: Solutions to improve capital mobilization activity in BIDV, Hanoi branch 53 4.2.1: Enhance and diversify forms of mobilization 53 4.2.2: Provide appropriate policies in order to encourage opening new account and use of services at the bank .54 4.2.3: Solutions for marketing .56 4.3: Recommendations to improve capital mobilization activity in BIDV, Hanoi branch 57 4.3.1: Recommendations to the government, State Bank of Vietnam and other related entities 57 4.3.2: Recommendations to BIDV headquarter .60 CONCLUSION .63 REFERENCES 64 LIST OF TABLES Table Contents Page Total fund mobilization of Hanoi branch from 2008 to 2011 27 Total outstanding loan of Hanoi branch from 2008 to 2011 30 Service performance of BIDV Hanoi branch, from 2008 to 2011 32 Operating performance of BIDV, Hanoi branch from 2008 to 2011 34 Structure of capital mobilization of Hanoi branch by clients 36 Structure of capital mobilization of Hanoi branch by maturity 38 Structure of capital mobilization of Hanoi branch by currency 41 Structure of total working capital of Hanoi branch by source 43 LIST OF FIGURES Figur Contents Pag e Hanoi branch’s fund proportion comparing to the whole system from 2008 e 29 to 2011 Hanoi branch’s credit proportion to the whole system from 2008 to 2011 31 Hanoi branch’s profit before tax proportion to the whole system from 2008 34 to 2011 Movements in the structure by clients of Hanoi branch from 2008 to 2011 38 Movements in the structure by maturity of Hanoi branch from 2008 to 40 2011 Movements in the structure by currency of Hanoi branch from 2008 to 42 2011 Movements in structure of total working capital of Hanoi branch from 2008 to 2011 ABBREVIATIONS 44 SBV: State Bank of Vietnam BIDV: Bank of Investment and Development of Vietnam NPL: Non performing loan CHAPTER INTRODUCTION 1.1: Rationale One of the most important roles of commercial bank is to gather capital of the economy In economies, there are surplus money holders (for example: they hide in the house and the money has not been brought into circulation) However, they are willing to give away money to earn some profitability from people who need money more than them at the moment In some cases, the lender and borrower not know each other, thus, cannot trust each other so the transaction fails to take place In those situations, banks as their intermediary, receiving money from people who want to borrow, paying interest to them and bring money to the person who wants to borrow loans This means bank serves as a borrower and lender with interest differences and use the amount to maintain its operation This action also promotes the well being of the society because the resource is allocated to people whenever they need it Apparently, from the above indication, we can realize the importance of capital for a bank’s operation If bank fails to get the money from surplus money holders, they cannot give the money to lenders, thus, cannot get profit from the interest differences Understanding this, bank should always add capital to fulfill its duty as an intermediary as well as making profit However, in order to raise capital in a competitive environment like these days is not easy Because of the fact that there are many banks and institutions being established in 2011, it is very difficult for any bank alone to get the money from potential surplus money holders From March to May 2012, I had a chance to internship in Bank of Investment and Development of Vietnam, Hanoi branch, in which I can work and learn with employees of customer relationship department After studying the performance of the branch over the past few years, I have noticed several problems in the mobilizing capital field Thus, I decided to choose the topic “ Current situation of mobilizing activities in BIDV, Hanoi branch and solutions for improvement” 1.2: Research questions  How is the mobilizing capital performance of BIDV, Hanoi branch from 2008 to 2011?  What are the limitations exist in mobilizing activities of BIDV, Hanoi branch?  What are the solutions to improve mobilizing activities of BIDV, Hanoi branch? 1.3: Research methodology This thesis uses the following methodology: statistics, analysis, synthesis, logical thinking, etc., to interpret the problems mentioned in the thesis content 1.4: Research scope This thesis applies the theory of capital mobilization to evaluate the performance of capital mobilization of BIDV, Hanoi branch, from 2008 to 2011 Moreover, it also suggests several solutions to improve the mobilizing activity for the branch in the future 1.5: Research structure This thesis is divided into main parts:  Theoretical background of capital mobilization  Current situation of capital mobilization in BIDV, Hanoi branch, from 2008 to 2011  Solutions to improve capital mobilization in BIDV, Hanoi branch CHAPTER THEORETICAL BACKGROUND OF CAPITAL MOBILIZATION 2.1: Overview of commercial bank’s capital 10 2.1.1: Definition Capital of commercial banks is defined as all assets in the balance sheet of Bank Accounting It includes equity and borrowings, in which borrowings play an important role as it actually creates profit for the banks 2.1.2: Classification of capital 2.1.2.1: Equity Any bank that begins operation must have a certain amount of capital, known as equity This type of capital banks can be used in long term, forming equipment and fixed assets for the bank Even though it has a small fraction, however, it is considered the buffer against risks to ensure the soundness operation of a bank It also shows the financial potential of the bank to the eyes of investors It includes: charter capital, additional capital during operation, borrowings that can be transferred into equity and other funds 2.1.2.2: Mobilizing capital This is the first and most important sources of capital raised from outsiders It normally contributes the most to the total capital and it has impact on every activities of a bank Banks not own this capital, thus, they have the responsibilities to pay the principal and interest whenever the owner wants to withdraw the capital This source of capital always fluctuates depending on several factors of the economy As a result, banks should keep a small fraction of the capital to ensure the solvency instead of using the whole amount Demand deposit This is a deposit that the customer can withdraw at any time and the bank must satisfy these requirements of customers In fact, it is deposited as the payment guarantee Normally, customers deposit their money in the bank in the forms of demand deposit to make payments conveniently and economically Unlike saving deposits, these funds are only temporarily idle As a result, customers only temporarily 52 4.1: Capital mobilization orientation for BIDV, Hanoi branch Over the past few years, the world has experience big crises in 2008 and 2011 As a result, Vietnam's economy has also suffered many negative effects: growth rate slowed down, foreign investment dropped sharply, stagnant bank, credit delinquency tends to increase, the exchange rate falls under pressure, etc Although the crisis has exposed clear weaknesses within the banking system of Vietnam, it also proves that we need to restructure the operation of the banking system Especially when Vietnam is in the process of integration and globalization, the need becomes more urgent as we are linked closely with the other economies in the entire world Under the condition given, there are things that the branch and BIDV as a whole must consider, which are: enhancing its advantages to get even more achievements while restricting the limitation problems In general, in the next few years, the bank tries to pursue a quality of professional activities, which contribute to raising economic growth, ensure safe and effective for banking activities Thus, Hanoi branch as one of the main branches of the headquarter and other agencies, sectors at all levels have adopted measures to implement the above objectives The orientation of the overall objectives of Bank of Investment and Development of Vietnam, Hanoi branch in 2012 are as follow: Strictly supervise and execute the bad loans As the mobilizing activities are not doing well, the bank should ensure the safety and healthy of the credit activities, by quickly execute the overdue loans or restructure the credit activities in order to protect the financial system of the bank In the difficult time like nowadays, the banks has to make sure that they not waste any capital Improve customer services 53 The basic direction of policy implementation is that customer service must have better supervision and control Whereas the cap interest rates are given by the State, the bank cannot freely provide a flexible interest to customers, they have to turn to offering higher quality services Moreover, the bank must also ensure their payment ability in order to remain trust of the customers As mobilizing activities deal mostly with the customers’ money, it has to be closely monitored and the use of the funds must be transparent Stress on applying modern technology to work Exploit the development of technology into the banking activities such as: installing more modern software to monitor the capital and credits activities, improve the infrastructure, opening more transaction units in order to better serve customers Improve the organizational structure and management mechanisms The management style should focus on capacity building; renovating work methods and style of customer service to meet business requirements in the new period Seek for diversifies customers Completing the process of becoming a joint-stock bank from a state-owned bank, by seeking for diversified customers As the bank normally has relationship with big state-owned corporation, in order to become more dependent, they need to seek for investments from diversified sources, including young and dynamic SMEs 4.2: Solutions to improve capital mobilization activity in BIDV, Hanoi branch Mobilization activities of the banks are important issues in the market mechanism, it is a flexible funding to help meet the capital needs of the market economy, socio-economic development, especially for developing countries like Vietnam today In order to attract idle capital from the various components of the economy (especially in the population) banks are required to have updated market analysis to a logical strategic market research and response to the needs of different conditions 54 On the other hand, it is predicted in the next year's GDP growth rate of Vietnam will be approximately 6.00%,of which the industry is playing more important role; as well as central bank monetary policy over the years generally ensure flexibility performance and efficiency consistent with the evolution of the market, gradually easing restrictions, toward integration This is important as the banks are operating between a narrow corridor of law and regulations If the State can provide clear and consistent policies, then the banks will have more confidence in building their own strategies Activities of commercial banks especially mobilization activities are affected by many factors, both objective and subjective Even though the objective factors are hard to control, still, the bank can always limit the subjective factors to have a better result 4.2.1: Enhance and diversify forms of mobilization From the limitation part, it can be seen that the banks only use some traditional forms of mobilizations, which are: deposits, trust funds, and issuing valuable papers to the capital market For the deposits from individuals and other economic and financial entities, the banks should the followings: Offering more maturities for term deposits The terms provided by the branch fall into only categories, which are below and over 12 months Thus, the branch should offer more maturity for the fund deposited like offering: 1,3,6,9months, etc., in order for customers to capture the movement of the market In order to that, the branch also needs to introduce all the terms offered to the customers so that they can find the most suitable term for their purposes Offering new deposit products Currently the demand for payment of the economic organizations and individuals are very large The bank account can be opened: 55 Account Overdraft: When customers use this account, they can withdraw the balance on their account Bank will build an overdraft limit for each customer If the customer overdrawn balance, the customer will incur a non-term interest rates for overdraft account in order to fulfill the prompt payment for business By using the overdraft money, the enterprises are considered taking a short-term loan in which the interest rates are low and easy to collect Income Account: The bank has specific methods to attract customers to open income accounts at bank by giving them preferential services such as customer may withdraw over the balance of the bank if their income exceed a certain level This action is to attract wealthy customers In order to this, the bank should keep contact with the big companies in which salary is deposited in the account in bank and the amount of salary is big enough Borrowing from diversified sources Also, the bank needs to broaden its mobilization channels like borrowing from different sources in order to achieve the targeted level Moreover, as the bank has been in the process of privatization, it can attract another source of fund by issue stocks to the market 4.2.2: Provide appropriate policies in order to encourage opening new account and use of services at the bank At BIDV, Hanoi branch, current customer policies were implemented properly, but this policy is not diverse and attractive enough to customers The procedure to open account at bank must be less complicated and timeconsuming For customers such as economic entities or corporate customers, time is a valuable resource Thus, the branch needs to collect customers’ important information with less paperwork and process Broaden the business network Continue to network expansion to deal with the business requirements of the branch in the potential areas At the moment, the branch has only transaction unit and the facilities as well as the quality of employees need to be improved As a 56 result, the branch needs to broaden its transaction unit to meet the needs of customers Also, each transaction unit must be assigned different specific tasks that match with certain condition The forms of mobilization or the time can be changed For example, in some areas, the transaction time can be extended more in the morning or in the evening for convenient purposes of the customers Whereas the branch normally deals with big corporate clients, the other sources of funds such as from citizens and small companies should be placed equally important Besides broadening the network, each transaction unit must have modern facilities; banking officers must perform the tasks quickly and politely so that customers feel comfortable doing transaction with the branch Improve the ability of bankers in performing service to customers Organize training courses to improve the ability of bankers, especially those staff working in international payment needs the addition of foreign languages to help foreign mobilization efficiently and in the logical structure Moreover, as the writer suggested, the branch prefers young and dynamic people as they can provide more creative ideas However, they still lack experience and knowledge about the culture of the corporation As a result, when the branch diversifies their customers, the bankers may not feel confidence or lack of trust in dealing with the smaller customers, thus, bank loses some potential ones In general, the human resource management theme must be: retaining the right people, providing right job that match with the ability of each person, and more importantly paying attention to their material and spiritual to give them the confidence to stick and work diligently Improve the customer service to treat customers more individually Completing the customer screening process, in order to classify customers When the branch has a diversified portfolio of customers, it is important that the bank divides customers into specific group in order to better and faster serves customers It is also one of the key strategies in the customer services in order to make sure that customers have the feeling of being treated individually in the branch For example: if the branch has an account of a import, export company, they 57 might have further service requests such as: grant L/C, foreign currency trade, guarantee, etc By figuring out their demand early, the bank will be better prepare for their withdrawal needs, thus, can reduce the banks’ liquidity risk Strengthening supervision and administration from top to bottom, maintaining existing operations with more accuracy and less errors 4.2.3: Developing marketing and promotion strategy to build the branch’s own image For the operation of the branch in general and capital raising activities in particular to be highly effective, the branch need to pay attention to marketing activities, and opened its own office in charge of these specialized functional activities in order to attract customers to send money The branch should pay attention to a number of activities such as: Building a professional and civilized working environment Implementations of civilization inside and outside of the branch, reasonable layout work, and create stylish, enthusiastic attitude of bank officers in performing service to customers These days, enterprise and commercial civilization is valued more than ever As a result, this implementation is undeniable as a competitive tool in the banking industry as well as meet the requirement of mobilization of capital Attach the marketing and promotion strategy to every new products and services to gain awareness of customers The orientation of marketing strategy is to recommend to the customers the brand prestige, new products and services to attract customers nationally and internationally Normally, customers want to send their money in banks, which are fast in meeting the withdrawal requirement, applying flexible interest rates and providing fast and essential services along with the deposits This is considered new for the branch as normally the marketing service is performed mainly at the headquarter level As a result, the branch does not have experience staffs in the field, who have long years of understanding the behaviors of customers Normally, customers deposit their money in BIDV because they have 58 known about the brand name in general, not for any specific branches Moreover, given the fact that BIDV has over 15 branches in Hanoi, it is very difficult for Hanoi branch to get the most attention from customers Therefore, the branch should suggest the situation to the headquarter to develop their own department of marketing and promotion The writer believes that this is possible as comparing to the other branches, the branch is in charge of collecting capital in the society and help out the other branches in need 4.2.4 Applying the modern technology to work Develop the branch’s own IT department to exploit the development of technology With the help of the technology, the bankers will not have to the work manually and have more time to focus on treating customers For example: the information sharing process is very important in any organization In the past, if we want to hold a meeting, every one must arrange their schedule and present at the meeting Nowadays, thanks to the help of technology, we can the virtual meeting in the Internet to save time of employees Applying the same facilities, modern technology, services in the branch and in other transaction units This is to make sure that customer feel comfortable wherever they the transaction with the branch Also, the professional and moral skills of banker officers should not differ too much from the branch to the transaction units so that the branch can have a consistent system in all places This is not only good to get customers’ satisfaction but also easier for the branch to manage 4.2.5: Building appropriate management strategies to attract diversified customers As used to be state-owned companies, BIDV normally prefer trading with large and state-owned companies, rather than doing business with small and young companies However, in some cases, the state-owned companies’ business might turn out to be stuff and outdated Thus, BIDV has to broaden their relationship to the other young and dynamic companies to seek for their funds As the small and medium companies might need sufficient funds to finance for their projects, this can 59 be done by offering them more easing conditions in entering a credit contract However, the basic requirements such as persuading use of loans or enough equity to contribute must be satisfied 4.3: Recommendations to improve capital mobilization activity in BIDV, Hanoi branch 4.3.1: Recommendations to the government, State Bank of Vietnam and other related entities Even though the awareness of people in depositing money in the bank is more common, however, under the business environment like nowadays, people are losing faith in the banking industry In order to maximize this idle capital, enhance the competitiveness, from which to attract domestic and foreign capital, the government needs to take some measures to improve confidence in the people and foreign investors The general themes of the policies are: stabilizing macroeconomic environment, restructuring of commercial banking system, and along with the direction, supervision and operations of commercial banks Stabilize macroeconomic environment This is the most important factor contributing to the successful mobilization activities of banks and other credit institutions In Vietnam today, in order to this, the government needs to implement a range of relevant factors such as: maintaining and stabilizing the political environment, creating psychological safety for investors (domestic and foreign) and the citizens Moreover, the government also needs to closely supervise the circulation of money in order to perform its task as a moneymaker This is to restrict the inflation rate, which has direct impact on the interest rates offered Besides these two factors, the government also need to build economic development policy properly and reasonably, in consistent with the situation in the country and in the long term One of the concerns is the privatization process of the state-owned companies in order to restrict the dependence of these companies to the government as well as provide fair competition in the market Also, the 60 government-funding projects must be transparent and fast to avoid embezzlement, waste of time and money This is to save money of the state budget and gain trust from citizens Create a uniform legal environment and stable Since the Law of State Bank of Vietnam and Law on Credit Institutions issued, there have been dozens of legal documents such as: decree, decisions, circulars, etc., guiding the two above laws However, the policies such as: interest rate mechanism, exchange rate, foreign exchange management, regulations on lending, mortgage, guarantee, foreign currency, etc., are not realistic and inadequate, and sometimes inconsistent with international rules on mobilization and credit expansion Therefore, in the future, the State Bank needs to change and promulgate legal documents in guiding in detail the activities of commercial banks Moreover, the documents should be suitable with the market condition and the commercial banks’ situation Restructuring of commercial bank system This is very important as Vietnam is in the process of the integration and globalization This means we will have to deal with many other potential investors from the other countries In order to gain their trust, we have to make sure that the quality of work in our country does not differ much from them In order to this, restructuring commercial banks system plays an important role For the past few years, we have witnessed the opening of many banks and credit institutions Not all of them are proved to be efficient and profitable Thus, the government should intervene to screen the best out of them Now that we have entered the global market, we need to satisfy several standard such as Basel and in the future Basel Considering the Capital Adequacy Level (CAR>=8%) of Basel 2, many Vietnam commercial banks cannot meet this requirement at the moment However, instead of rushing the commercial banks into doing this, the State Bank should consider the banks’ condition first, and then determine the proper date to execute the law 61 Besides, in the market mechanism, the State cannot subsidize too much to their children, which are the state-owned companies Thus, once again, the job of privatizing the state-owned companies is even more important As in the globalization process, many foreign banks may come to Vietnam and steal away some of the market share of Vietnamese domestic banks Even though, they not have the relationship and knowledge about Vietnamese customers, they have the modern facilities and services to attract them The banking industry also needs to be restructured in the way that modern technology and services are applied to the commercial banks As the bank industry gets more crowded, customers will have more sophisticated needs The study of new services and technology can be acquired by sending the banker officers and top managers to study in the other develop countries Central bank keeps key role in the regulation of activities and serves as a capital channel for commercial banks Run and implement flexible national monetary policy, which should be encouraged to focus on saving idle capital for production and business activities Central bank interest rate should be used as leverage to promote the commercial banks in raising capital Banks need to strengthen coordination with the management of foreign investment funds, fund aid from the government institutions and non-governmental organizations (foreign) to mobilize all capital resources abroad into commercial banks Banks need to have specific guidance information and data on the activities of commercial banks The State Bank should encourage the banks to provide transparent information about their investment, thereby helping customers get the right solutions in doing business with banks As a depositor, one of the top concern questions is: “ what is the bank doing with my money?” Thus, transparent information is very essential in the mobilizing activities Enhance the inspection and control activities of commercial banks 62 Inspection is meaningful decisions for detecting, preventing and dealing with violations of credit institutions, making the industry soundness and efficient Especially in recent times, the situation of overdue debts of the credit institutions is getting higher The observance of the provisions on compulsory reserve ratio, liquidity risk, the conversion ratio of bank capital has not been done properly Therefore there should be more supervision of the State Bank In summary, the State Bank needs to study and implement comprehensive solutions Also, the State Bank needs to closely link with the State (Government) to provide practical policies, which can properly promote the commercial banks activities in order to better serve the economy 4.3.2: Recommendations to BIDV headquarter Facilitate guidelines and procedure to the branches Bank of Investment and Development of Vietnam needs to help facilitate guidelines and procedures to the branch, regarding the clients who have relationship with the branch in the headquarter level Deployment of modern banking Also, the bank should continues rapid deployment of modern banking such as quick payment, combined forms of retail banking to wholesale banking, implementing communication mechanisms one-stop service, from which to attract funds from payments Financially support the branch in broadening and transforming business network Financially support the to branch offices to build and place the new transaction units and ATMs This is to maintain the purchase long-term stability of the organization, which is the first condition to create trust with customers Support foreign currency when the branch does not have enough foreign currency to meet the demand of customers This is very important for Hanoi branch as they have many relationships with the import and export companies in Vietnam As a result, lack of foreign currency is not acceptable This can be done by allowing 63 its branch to trade on the interbank market, or among the other branches for the foreign currency Bank of Investment and Development of Vietnam should provided its branches with additional IT equipment, high technology to ensure the process of deploying new applications in trading, and other information related to the change, turning of financial markets in the near future Moreover, the bank should always keep in touch with the other corporations and banks to make the maximum convenience to the branch as well as customers of branches in supervising activities, as well as learning and exchanging information The headquarter should have a strategy of training in the entire system to provide consistency in the whole system They should also transfer or train the experience staffs to the branch to equip the other young employees with the knowledge of the history and culture of the organization Limit the opening of new branches and transaction units to avoid “cannibalization” Finally, the writer also suggest that the headquarter restructure its branches and transaction units Nowadays, Bank of Investment and Development of Vietnam is considered one of the banks that have largest numbers of branches and transaction units This leads to the cannibalization phenomenon As a result, the bank should not open more branches, but instead, cut off some of the branches that not prove to be efficient and profitable CONCLUSION Funds mobilization is very important role over the activities of commercial banks It is the leading determinants of the size and position of the bank in the banking market Realizing the importance of funds, the commercial banks are trying very hard to get as much idle capital as possible However, as more banks are opening and the amount of idle capital is not increasing much because of the bad 64 business environment described throughout the research, the race of mobilizing capital is becoming more intensive than ever For BIDV as used to a state-owned bank, they have to strictly obey to the regulations of the government, such as the mobilizing cap of 14% Because of this fact, they lose a potential amount of capital to the other banks Hanoi branch, as a member of BIDV, without a doubt, also has some certain difficulties Hanoi branch in recent years has raised a significant amount of capital, especially in 2010; however, the capital falls substantially in 2011 Despite the objective factors that cannot be controlled, there are still limitations that lie in the responsibility of the branch After analyzing the performance of mobilizing activities of Hanoi branch over the past few years, the writer has found out some limitations as well as reasons of the limitations From then, the writer suggests several recommendations to improve the mobilizing activities of Hanoi branch The recommendations mostly suggest that the branch broaden its target customers, diversify its products and services and better the customer services as well as marketing strategies Capable of doing that, along with the help of the government and State Bank in helping the economy recovers from crisis, the writer believes that the branch and BIDV as a whole will have a better result in the mobilizing activities in the near future REFERENCES Peter S.Rose (2000) Commercial bank management Timothy W.Kock Bank management Harcourt Brace College Publisher Ass Prof Nguyen Thi Mui (2003) Quan tri ngan hang thuong mai NXB Tai Chinh 65 Daniel K Tarullo (2008) Banking on Basel Peter G Peterson Institute for International Economics Kent Matthews and John Thompson (2005) The Economics of Banking John Wiley & Sons, Ltd Joel Bessis (2007) Risk management of Banking John Wiley & Sons, Ltd Hugh Croxford, Frank Ambramson, Alex Jablonowski (2005) The art of better retail banking John Wiley & Sons, Ltd Moody’s Global Banking Financial Statement of BIDV (Year 2008,2009,2010,2011) 10 Annual reports of BIDV Hanoi branch (Year 2008,2009,2010,2011,2012) 11 Laws of credit institution 2011 12 “Property market needs unfavorable policies removed” Url: http://english.vietnamnet.vn/en/business/21632/property-market-needs-unfavorablepolicies-removed.html 13 “Circular 02 of State Bank, tools of liquidity game” Url: http://dantri.com.vn/c76/s76-563235/tran-lai-suat-14-cong-cu-cua-tro-choi-thanhkhoan.htm 14 “Circular 13 regarding Capital Adequacy Ratio of credit institution” Url: http://luattaichinh.wordpress.com/2010/09/06/thng-tư-132010tt-nhnn-quy-dịnh-vềtỷ-lệ-bảo-dảm-an-ton-của-tctd/ 15 “ Mobilizing capital of commercial banks must ensure screening and competitiveness” Url: http://vneconomy.vn/20120210013349114P0C6/ngan-hang-huy-dong-von-sang-locva-canh-tranh.htm 16 “BIDV official website” Url: http://bidv.com.vn 17 “Securities Company of BIDV official website” Url: http://www.bsc.com.vn/ 66 ... Trade finance and International Payment x Corporate finance: Including project finance, on demand loan, revolving finance, installment finance, overdraft finance, institutional development, lending... half of 2011 is quite difficult for mobilizing activities In fact, this is not a situation of BIDV alone, but the banking industry in general The situation has been described in the business performance... and restructuring 46 3.2.2.3: Limitations of BIDV, Hanoi branch in mobilizing activities from 2008 to 2011 Having investigated the current situation of the branch in mobilizing activities from