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Current Status of Customer Relationship Management at Vietnam Joint Stock Commercial Bank for Investment and Development - Ha Long Branch


However, further analysis of the outstanding loan structure shows that although the total outstanding loan of the branch has increased significantly, the absolute increase is mainly concentrated in short-term credit. Although the growth rate of medium and long-term outstanding loans is quite high, due to the low proportion in the total outstanding loan, the contribution to the overall increase is not large. In terms of currency, the proportion of loans in VND is absolutely dominant. The outstanding foreign currency loans of the branch are very modest in both absolute numbers and proportion. In the recent period, the approach to enterprises operating in the field of import and export, enterprises operating in industrial zones, and enterprises with foreign investment capital has not achieved the target set by the Branch, leading to unstable credit growth in foreign currency.

Regarding credit risk control, BIDV Ha Long has made many efforts. Although the bad debt ratio has increased slightly in recent years, in the context of general economic difficulties, maintaining a bad debt ratio below the State Bank's permitted limit demonstrates BIDV's relatively good credit risk management capacity.

2.1.3.3. Performance of other services


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In addition to traditional services, BIDV Ha Long has developed non-credit services to meet the increasing needs of customers, increase the competitiveness and profitability of the bank such as: payment transfer services, money collection (electricity bills, Viettel phone bills, etc.), treasury services (safes, asset custody, counting and collecting money at home, etc.), ATM cards, trade finance, guarantees, Western Union money transfers, foreign currency trading (foreign currency options).

With the goal of developing non-credit services to increase the proportion of non-credit service revenue in total income, BIDV Ha Long has always paid attention to improving the quality of these services, meeting the diverse needs of customers. Many products


Banking products and services with advanced and convenient features for customers are applied by BIDV Ha Long such as: Automatic salary payment, bill payment, one-place deposit and multiple withdrawal services, automatic teller machines, card transaction systems, and technological services (home services): homebanking, Internetbanking, BSMS, ... one-stop transaction has saved maximum time and procedures for customers when transacting at the Bank.

BIDV Ha Log has always paid attention to improving the quality of these services, meeting the diverse needs of customers. Many banking products and services have advanced and convenient features for customers.

2.2. Current status of customer relationship management at Vietnam Joint Stock Commercial Bank for Investment and Development - Ha Long Branch

2.2.1. Customer identification

2.2.1.1. Identify customers and collect information


As analyzed, customers are the decisive factor for the survival of businesses, especially for the survival of banks. BIDV customers need to pay attention to the following characteristics:

- BIDV Ha Long was established in the form of geographical division. Therefore, customers are mainly concentrated in Quang Ninh province.

- The bank's target customers will include both individual and institutional customers.

- The issue of competition to gain customer trust in Quang Ninh is now becoming increasingly fierce for banks in general and BIDV Ha Long in particular. In Quang Ninh province, there are not only domestic banks such as the State Bank of Vietnam, Quang Ninh branch, Foreign Trade Bank (Vietcombank), Saigon Thuong Tin (Sacombank), Saigon - Hanoi (SHB), Vietnam Maritime Bank (Maritimebank)... but also foreign banks such as


The customer database includes information about customers who transact with BIDV Ha Long, including individual customers and corporate customers. Basic information of individual customers is collected from the first time they start a transaction with the bank. The customer database includes:

For individual customers:

- Personal information: This is data that helps identify customers, including information about name, age, gender, occupation, phone number,...

- Transaction behavior: savings, credit loans, card issuance, which transaction, at which branch, how much money, how often it is repeated,...

- Necessary documents as collateral (when borrowing credit): including documents proving income, labor contract, house rental contract, business license,... of the borrower and co-borrower

For institutional customers

- Basic information and transaction behaviors are similar to individual customers.


- Necessary documents for guarantee (when borrowing credit): proof of ownership of collateral and legal documents such as ID card/Passport, business registration certificate, documents proving financial capacity, Contract for purchase and sale of goods,...

This data will be stored in two forms: hard data (customer records), electronic data (on the customer management software system), helping the bank:

- Retain customers and encourage repeat transactions: there will be customer appreciation programs and gifts for customers on special occasions.

- Identify customer needs to have appropriate policies (will be explained more clearly in the section on distinguishing customers according to needs).

- Targeting potential profitable customers: From the customer database, BIDV will filter out potential profitable customers to have relationship policies.


suitable customer


Any individual or organization wishing to use BIDV's products and services must clearly state personal information such as full name, address, ID number, phone number, and signature of each customer on the CIF and account opening registration form.

The problem still exists at BIDV Ha Long: customer information is not actively updated but mostly provided by customers. This causes a passive reaction to CRM activities at the branch. Up to 100% of employees surveyed rated the role of customer data as very good, which is really useful in helping them understand customers better, but 40% said that the data that is collected (due to updating according to customer profiles) is only done regularly and proactively at a fair and average level. Therefore, the result is that 40% of employees said that the issue of information collection partly supports early forecasting of business results and strategic orientation.

2.2.1.2. Information management

Bank information management system


All customer information at branches in the system is managed uniformly and centrally at the Head Office. The bank's data is stored centrally at BIDV Head Office, the system distinguishes data of each branch by branch code. There is a close connection in using information between the business modules applying the customer relationship management program: CIF (customer information), DEPOSITE (deposit), Transfer (money transfer), Loan (credit), Treasury (capital) and Trade Finance (trade finance).

Database structure


BIDV Ha Long Bank's customer database is formed from the process of contacting and transacting with customers. Currently, each customer transacting at the bank has a separate CIF code, from which deposit accounts will be opened,


loan amount... respectively. Customer information is recorded in the first transaction and is stored to meet the customer's next transactions in order to manage customers as well as compare data, reports, and serve the bank's administrative and operational work. During the transaction process, customer information and data will be updated and supplemented when there are changes or occurrences.

Update and supplement information Periodically twice a year, branches and transaction offices are responsible for updating customer information mainly on the following aspects: customer financial situation, customer credit activities at banks, other credit institutions... The interval between updates is quite long, so sometimes, during the working process, employees still need to proactively find out more information about customers outside of the information channels updated on the system.

How to manage customers

Based on the information provided by customers, the branch has built a customer database in the following order: customer name, contact address, customer code, tax code, customer type: individual, private enterprise, limited liability company, joint stock company... Based on the need to use banking services, BIDV Ha Long has classified customers to use each type of separate service such as: credit, deposit, domestic payment, international payment, card, guarantee... Based on customers using services at the bank, if customers have a need, the branch provides all transaction information of customers used at the bank, such as information on balance, transfer, number of transactions, transactions, interest rates, banking service fees...


The customer information management system is built on the basis of parameters and centralized storage throughout the BIDV system, ensuring information consistency throughout the bank. Each customer has a unique code (CIF number) throughout the bank. Based on this code, the system allows queries to review the overall and detailed accounts of each customer at any time. When a transaction occurs, the system will warn customers with "problems". A complete and comprehensive assessment of customers will facilitate the development of customer policies and strategies. The customer information management system is one of the foundations for the development of banking services: ATM, credit card, POS, Internet Banking, Phone


Banking…


Figure 2.2 BIDV software system

Source: Administration Department


Each customer has a CIF (customer information file) number that stores all of their information and a unique credit number (A/A) in the entire system.


system. The CIF number is a unique code for each customer, automatically generated by the system, consisting of 10 characters. The A/A code is used to manage the maximum credit limit for each customer. Based on the CIF and A/A numbers, customers can conduct credit activities at many different branches of BIDV. The construction of products, information about collateral as well as other information used in the loan are set up by parameters, which makes it very convenient to modify and supplement.

Loan management has different levels:

- CIF: Customer information - Unique in the entire system.

- A/A: Credit code - Unique in the entire system.

- Facility: Contract (Loan limit or guarantee) - Includes 9 levels, including: Regular account; main account; sub-account. Managing multiple levels like this is convenient for monitoring customer limits from the overall to the details of each type. In addition to the loan subsystem, the system also provides a Collateral Management subsystem connected to the facility (Limit) in the loan subsystem. The system distinguishes between two types of accounts: Customer account and GL account. Each account is tracked separately on an account, overdue debt is tracked through statuses without transferring back and forth between accounting accounts like the current system.

The system supporting customer relationship activities in business includes: CRM system and Contact Center system, MIS reporting information system, Treasury system. In which:

Treasury subsystem: The Treasury subsystem is designed as an open, automated and centralized system. The Treasury subsystem allows setting limits for each customer, trader, trading desk, currency, etc. and automatically controls compliance with limits in real time or irregularly. The system automatically performs accounting entries into GL, creates confirmation letters, calculates prices, interest rates, etc. and allows for the creation of analytical reports, assessing the level of risk when there are market fluctuations.


The centralized data warehouse (DWH) serves as the essential operational and management reporting unit for the bank. The DWH extracts and transforms data from two main data sources: SIBS and Treasury. The main subsystems on SIBS include:

- Customer information management subsystem

- Deposit subsystem

- Loan subsystem

- Trade finance subsystem

- Money transfer subsystem

- General accounting subsystem

- Treasury subsystem.

Up to now, the customer relationship management system has been operating stably with an estimated transaction volume and data growth of about 550% (doubled).

5.5 times compared to the time of implementation). However, after a long period of use (more than 9 years), managing nearly 6 million customers, the system has also revealed some limitations, specifically as follows:

- The current data capacity is growing very quickly, the operation process must be continuously cleaned to maintain operations in a safe state <85% of hard disk capacity, the current data capacity is about 75%. Therefore, the IT Center has implemented many synchronous solutions to optimize the system, specifically: Load distribution to optimize the system; periodically clean up data on subsystems; fine-tune and optimize database operations. The above solutions are only temporary solutions because the data to be managed is constantly increasing, reaching the initial design threshold. Therefore, if this situation continues, the system may not be able to operate with full functionality.

- The system at Ha Long branch is developed on old technology (java 1.3), not suitable for the development capacity of technology and the goal of centralized management to minimize operational and business risks. The operational and business subsystem modules are developed on old technology (java 1.3), not suitable for the development capacity.

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