Firstly, it is necessary to coordinate with the State's guidelines and policies, focusing on improving the bank's internal governance capacity, thereby contributing to preventing risks from occurring, including ethical risks related to ownership and management.
Banks can develop their own governance regulations in accordance with the characteristics and development orientation on the legal basis, which is Decision No.
12/2007/QD-BTC “promulgating regulations on corporate governance applicable to companies listed on the stock exchange or a securities trading center”. In addition, it is necessary to promote the role of the Board of Directors in managing the bank's operations as well as protecting the interests of the owners.
Secondly, it is necessary to improve the quality of information disclosure for shareholders, which includes transparency of information related to banking governance (change in senior personnel, business performance, audited financial statements, annual reports), as well as transparency of information related to shareholder structure, in order to increase credibility with investors and develop the bank's reputation. Furthermore, state-controlled banks must always prioritize the interests of shareholders, focusing on fairness when issuing shares to shareholders based on their ownership percentage.
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Thirdly, it is necessary to have a plan to increase charter capital to ensure the quality of operations. Due to the legal basis, the increase in charter capital needs to be implemented urgently in order to meet the minimum CAR, as well as ensure other activities of the bank such as credit growth, reduction reduce bad debt ratio. In the context of Vietnam's economy facing a number of barriers at present, BIDV, Vietinbank, Vietcombank together with Agribank still play the leading role in leading the market, and are the effective arm of the State Bank in implementing monetary policy and supporting the State's macro goals.
Fourthly, banks controlled by the State need to promote their market leadership strengths, particularly in growing lending activities. As established in Chapter 3, the rate of loan growth has a beneficial influence on bank financial performance in 5 of 6 models.
In the current state of the Vietnamese economy, these banks must increase credit safely and effectively, direct credit to production and business fields, and support economic recovery; do not loosen credit conditions; continue to strictly control credit in potentially risky areas; take steps to prevent bad debt.
Fifthly, according to the findings of the study, joint-stock commercial banks with over 50% state ownership of charter capital must lower operational expenses and increase resource utilization efficiency in order to improve business performance.
Accordingly, these banks must enhance cost management controls, guarantee the effectiveness of each expenditure, and decisively tackle costs that are out of compliance or exceed the norm. Moreover, in order to save costs, formalistic expenses (for example, corporation expenses and public administration charges) must be reduced, and needless spending must be eliminated. To attain great efficiency, the implementation of these savings needs to start from the leadership level and work its way down to all bank employees.
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SUMMARY OF CHAPTER 4
On the basis of the content of the first three chapters as well as the regulations issued by the Government, in chapter 4, the student has proposed recommendations related to ownership to improve the efficiency of financial performance of Vietnamese joint-stock commercial banks with the state ownership of over 50% charter capital. These recommendations include two main groups, in which, the first group is a suggestion for regulatory agencies, and the second group is suggestions for bank administrators. The first group of recommendations focuses on adjusting the appropriate ownership structure, ensuring financial health, and improving the quality of management, inspection, and supervision of governance activities at banks. The second set of recommendations emphasizes that in order to increase operational efficiency, BIDV, Vietinbank, and Vietcombank need to focus on improving the bank's internal governance capacity, making information transparent to investors, and thereby ensuring the maintenance of sustainable development.
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GENERAL CONCLUSIONS
The link between ownership structure and operations of firms in general, and the banking sector in particular, has piqued the interest of scholars all over the world since the middle of the twentieth century. Studies on the influence of ownership components such as state ownership, foreign ownership, etc. on bank operational efficiency or risk- taking are frequently conducted in emerging economies. In Vietnam, the economy is strongly reliant on the credit institution system, as the pace of economic integration accelerates, a revolution in banking governance is required to keep up with market economic trends and increase bank competitiveness. Therefore, the relationship between ownership structure and financial performance in Vietnam's banking system in recent times has been an influential topic. Which, 3 banks BIDV, Vietinbank, and Vietcombank, over the past 10 years, have undergone equitization and restructuring events from a 100% state-owned bank to now become joint-stock commercial banks with the state ownership of over 50% charter capital. With a pivotal role in the Vietnamese banking system, the change in the type of these banks is an event that receives attention and monitoring from domestic and foreign economists.
In the above context, on the basis of analyzing scientific works on the relationship between ownership structure and banking performance, students then assess the impact of ownership structure on the performance of Vietnamese joint-stock commercial banks with the state ownership of over 50% charter capital for the period 2009-2021. The study also provides an overview of ownership structure and related theories; the legal basis and current state of the ownership structure of Vietnamese commercial banks; the real situation of ownership structure and the business results of three banks BIDV, Vietinbank, and Vietcombank in recent years.
On those solid foundations, students proposed a quantitative research model to assess the impact of ownership structure on the financial performance of these banks in the period 2009-2021. The thesis has ensured the implementation of the objectives of the
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topic based on the balance sheet data set of BIDV, Vietinbank, and Vietcombank, including the dependent variable representing financial performance, which is ROA and NIM; the explanatory variables are ownership structure variables (State ownership, domestic private ownership, and foreign ownership), in addition, there are control variables such as bank size, efficiency ratio, loan growth, loan to deposit ratio and inflation. Analytical results according to the FGLS approach as initially expected by the student, state ownership has a negative impact, while non-state ownership and foreign ownership have a negative impact on the financial performance of banks. In addition, with control variables, bank performance is negatively correlated with cost to income ratio, positively related to inflation is said to only affect NIM. These results are supported by economic theories and previous domestic and international studies. Through the analysis of the reality and the results of the quantitative model, the student made recommendations to state agencies to improve the legal basis, enhance inspection and supervision capacity, and change the ownership structure at Vietnamese Joint-stock Commercial banks with the State ownership of over 50% charter capital in the direction of increasing the ratio of private and foreign ownership, reducing the rate of government ownership. On the side of banks, the study also offered solutions to strengthen internal governance capacity, direct credit growth, and manage costs effectively to improve financial performance.
In fact, the paper still had limitations in terms of data. Because the study focused solely on Vietnamese joint-stock commercial banks with state ownership of more than 50% of charter capital, the research sample was small, the quantitative model may not have been fully utilized. Moreover, banking-related data, especially data on ownership structure, are manually collected by the student from financial statements, annual reports, and other sources. Therefore, these figures may be misleading, reflecting just a part of the reality of the bank's financial situation. Besides, bank financial performance is influenced not just by ownership rate variables or independent variables in the model, but also by other elements that the student has not yet considered, such as the variables
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representing management capacity, risk, business market share, and brand reputation, etc.
As a highly complicated topic, studies related to the relationship between ownership structure and bank performance need to be completed and investigated further. Within the scope of their knowledge and capacity, through 4 chapters of content, the student has basically solved the research problems posed when researching Vietnamese Joint-stock Commercial banks with the State ownership of over 50% charter capital, but the thesis cannot avoid subjective or objective shortcomings. Last but not least, the student hopes to get feedback from lecturers and others who are interested in this issue in order to strengthen the research paper and contribute meaningfully to the governance of Vietnamese joint-stock commercial banks with state ownership of more than 50% of charter capital.
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