MINISTRY OF EDUCATION AND TRAINING HO CHI MINH UNIVERSITY OF ECONOMICS
----- -----
Trinh Thi Thanh Thao
ASSESSMENT OF CREDIT RISK MANAGEMENT ACCORDING TO BASEL II AGREEMENT AT JOINT STOCK COMMERCIAL BANK FOR INVESTMENT AND DEVELOPMENT OF VIETNAM.
MASTER'S THESIS IN ECONOMICS
Ho Chi Minh City – 2017
MINISTRY OF EDUCATION AND TRAINING HO CHI MINH UNIVERSITY OF ECONOMICS
Trinh Thi Thanh Thao
ASSESSMENT OF CREDIT RISK MANAGEMENT ACCORDING TO BASEL II AGREEMENT AT JOINT STOCK COMMERCIAL BANK FOR INVESTMENT AND DEVELOPMENT
VIETNAM EXHIBITION.
Major: Finance - Banking Code: 60340201
MASTER'S THESIS IN ECONOMICS
SCIENTIFIC INSTRUCTOR: DR. PHAM TO NGA
Ho Chi Minh City – 2017
COMMITMENT
I hereby declare that this is my own research work. The information and content in the topic are based on actual research and are completely true to the cited source.
Ho Chi Minh City, August 20, 2017
Author: Trinh Thi Thanh Thao
INDEX
COVER PAGE STATEMENT OF GUARANTEE TABLE OF CONTENTS
LIST OF ABBREVIATIONS LIST OF CHARTS LIST OF TABLES
CHAPTER 1: TOPIC INTRODUCTION 1
1.1. Reasons for choosing topic 1
1.2. Research objective 2
1.3. Research question 2
1.4. Research object and scope 2
1.5. Thesis structure 2
1.6. Research method 3
1.7. Scientific significance of research topic 3
CHAPTER 2: CREDIT RISK MANAGEMENT AT COMMERCIAL BANKS AND BASEL II AGREEMENT 4
2.1. Overview of credit risk at commercial banks 4
2.1.1. Concept of credit risk 4
2.1.2. Credit risk classification 4
2.2. Credit risk management at commercial banks 6
2.2.1. Concept of credit risk management 6
2.2.2. The necessity of credit risk management 6
2.2.3. Credit risk management process in commercial banks 7
2.2.3.1. Credit risk identification 7
2.2.3.2. Credit risk measurement 8
2.2.3.3. Credit risk control 13
2.2.3.4. Credit risk management 13
2.3. Credit risk management at commercial banks according to Basel II agreement 15
2.3.1. The birth of the Basel 15 international agreement
2.3.2. Credit risk management in Basel II 17
2.3.2.1. Minimum capital required 18
2.3.2.2. Standardized approach to RRTD 21
2.3.2.3. Approach based on internal bank rating assessment 24
2.4. Experience in applying Basel II Agreement in countries in the region 27
CHAPTER 3: CURRENT STATUS OF CREDIT RISK MANAGEMENT AT JOINT STOCK COMMERCIAL BANK FOR INVESTMENT AND DEVELOPMENT OF VIETNAM 31
3.1. Business results of Vietnam Joint Stock Commercial Bank for Investment and Development in recent years 31
3.2. Current status of risk management at Vietnam Joint Stock Commercial Bank for Investment and Development 36
3.2.1. Regulations on retail credit 36
3.2.2. Credit activities 37
3.2.3. Credit structure 38
3.2.4. Credit risk management process at Vietnam Joint Stock Commercial Bank for Investment and Development 40
3.2.5. Scoring process for economic organization customers 41
3.2.6. Individual customer scoring process 44
3.2.7. Current status of credit risk 47
CHAPTER 4: ASSESSMENT OF CREDIT RISK MANAGEMENT AT BIDV BANK ACCORDING TO BASEL II AGREEMENT 50
4.1. Achievements according to Basel II standards 50
4.1.1. Successfully building an internal credit rating system 50
4.1.2. Full provisioning 51
4.1.3. Establish a specialized risk management department 53
4.2. Limitations according to Basel II standards 54
4.2.1. Not reaching the minimum capital adequacy ratio as required by Basel II 54
4.2.2. The ratio of bad debt and overdue debt in some groups in the total outstanding debt is still quite high 55 4.2.3. There is no collateral management system 56
4.2.4. Risk analysis and assessment from the customer side still has many shortcomings 56
4.2.5. Risk assessment and forecasting work has not yet anticipated all types of risks 56
4.3. Causes of difficulties in applying Basel II Agreement in credit risk management at BIDV 57
CHAPTER 5: RECOMMENDATIONS AND SOLUTIONS TO IMPROVE CREDIT RISK MANAGEMENT ACCORDING TO BASEL II AGREEMENT AT BIDV BANK 60
5.1. Solutions to improve credit risk management according to Basel II Accord 60
5.1.1. Solutions on credit risk management strategies and policies 60
5.1.2. Market solutions 61
5.1.2.1. Dispersion of credit risk of BIDV Commercial Joint Stock Bank in the credit market 61
5.1.2.2. Credit insurance implementation 63
5.1.3. Business solutions 63
5.1.3.1. Correct implementation of credit procedures 63
5.1.3.2. Debt classification, collection and settlement 68
5.2. Some recommendations to the State Bank 72
5.2.1. Perfecting the method of bank supervision 72
5.2.2. Building and perfecting necessary systems to ensure security of banking credit activities 73
5.2.3. Guide and direct commercial banks to implement State sanctions to secure credit activities 74
REFERENCES APPENDIX
BIDV
Joint Stock Commercial Bank for Investment and Development of Vietnam | |
CF | Purchase Finance |
DF | Project funding |
DPRR | Risk reserve |
EAD | Customer's outstanding balance at the time of default |
Board of Directors | Board of Directors |
HVCRE | Commercial Real Estate Financing with High Volatility Rates |
IPRE | Profitable real estate financing |
LGD | Loss ratio when customers cannot pay their debts |
NH | Bank |
State Bank of Vietnam | State Bank |
Commercial Bank | Commercial Bank |
OF | Tangible Asset Financing |
PD | Probability of default |
Customer Service | Customer Management |
QLRR | Risk Management |
QLTD | Credit Management |
QTRRTD | Credit risk management |
RR | Risk |
RRTD | Credit risk |
SL | Narrow Sector Loans |
TCKT | Economic organization |
Maybe you are interested!
-
Assessment of Credit Risk Management Status According to Basel II Standards at Vietinbank Vinh Long -
General Assessment of Credit Risk Management Status at Vietnam Joint Stock Commercial Bank for Investment and Development - Trang An Branch -
Credit risk management at Vietnam International Commercial Joint Stock Bank - Hanoi Branch - 12 -
Credit risk management for personal loans at Nam A Commercial Joint Stock Bank - Quang Ninh Branch - 13 -
The Role of Risk Management in Credit Activities at Commercial Banks
