Limitations and Future Research Directions

5.6 NEW CONTRIBUTIONS OF THE TOPIC

As mentioned about the limitations of previous models, the author has found solutions to limit credit risk and the impact of credit risk on the business performance of banks. Therefore, these are the new points of the author. The results of the empirical study found the following new points:

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Research results found factors affecting RRTD:

- The bad debt ratio of the previous year will increase credit risk in the following year. High credit risk provisions also increase credit risk at commercial banks. Controlling bad debt and complying with the State Bank's regulations on provisioning are necessary measures to help commercial banks limit credit risk.

- Inefficient management of operating costs by banks can increase credit risk. If banks control and use externally mobilized capital well, credit risk will not increase.

In addition, the author also finds statistical evidence showing that RRTD has an impact on business performance:

- Credit risk occurrence actually reduces bank performance through a negative relationship found to be statistically significant.

- Larger bank size will create economies of scale, increase efficiency and increase the effectiveness of bank operations.

- Better cost management will bring higher income to the bank, increase bank profits and thereby increase business efficiency through the inverse relationship between ineffective cost management and business efficiency.

- Poor management of non-interest income leads to lower business performance. This is considered a reverse effect which is found to be statistically significant.

- Banks balance capital mobilization and have reasonable plans to use mobilized capital, which will contribute to improving the bank's business efficiency.

- Good economic growth will contribute to increasing the business efficiency of banks, so this is one of the important findings contributing to making recommendations to the Government to create favorable conditions for macroeconomic stability. In addition, stabilizing the exchange rate also helps stabilize the business activities of banks.

5.7 LIMITATIONS AND FURTHER RESEARCH DIRECTIONS

5.7.1 Limitations

- Data from financial statements: the limitation of the study is that it uses secondary data published from the financial statements of Vietnamese commercial banks from 2005 to 2015, so it is certainly difficult to avoid shortcomings in collecting research data and affecting the results.

- Some independent variables in models 1 and 2 have changed signs compared to the author's expectations and those of some other studies. This comes from the data sample and actual conditions at Vietnamese commercial banks. The author's limitation is that he has not performed additional regressions to examine the model's stability.

- The author only uses bad debt ratio and credit risk provision to represent credit risk. Only uses ROE and ROA variables to represent business efficiency.

5.7.2 Future research directions

In future studies, the author would like to propose some directions as follows:

- Use additional variables as independent variables representing credit risk and business performance.

- Perform some more regressions to check the robustness of the model.

- Collect more complete data to fully analyze the credit status and business performance of Vietnamese commercial banks.

- Expand the scope of research to all Vietnamese commercial banks and some commercial banks in the region, drawing lessons for Vietnam.

CHAPTER 5 SUMMARY

In chapter 5, the topic has summarized the important results of the study. From there, some recommendations and main solutions are proposed to limit the RRTD of Vietnamese commercial banks. The recommendations and solutions are derived from the results of the regression model. Some solutions recommended for Vietnamese commercial banks have been given. In addition, solutions related to macro factors have also been mentioned.

CONCLUDE

Healthy and developed commercial banking activities will help the Vietnamese economy grow sustainably, stabilize the macro economy, and contribute to strengthening social security. However, in the face of the overheating credit growth of credit institutions and the increasing bad debt, commercial banks and related organizations and departments need to coordinate to limit the instability that occurs in banking activities. Commercial banks must regularly monitor credit activities, promote credit development with close assessment of credit quality, promote training and improve the quality of human resources for banking activities, perfect the internal credit rating system and credit granting processes, and monitoring and inspection processes to detect credit risks and find timely solutions. For the Government, the State Bank and relevant agencies need to coordinate with each other and support commercial banks in specifying legal documents, perfecting the legal framework related to banking activities in general and credit granting activities in particular, maintaining economic growth, controlling inflation and stabilizing exchange rates, strengthening banking inspection and supervision activities to remove difficulties for commercial banks in credit granting, debt classification and provisioning for credit risks as well as perfecting, building and developing the debt trading market to create liquidity for the purchase and sale of bad debts of commercial banks.

In addition, the author also points out the new contributions and limitations of the topic, the remaining issues in data and the scale of the research sample, thereby suggesting some further research directions for readers to refer to and complete new studies, thereby contributing to identifying macroeconomic factors and bank characteristics affecting credit risk and finding solutions to limit credit risk for commercial banks, contributing to helping the system of Vietnamese commercial banks develop stably and sustainably.

LIST OF PUBLISHED SCIENTIFIC RESEARCH WORKS BY STUDENT NGUYEN QUOC ANH

A. ARTICLE

1. Nguyen Quoc Anh - "Expanding bank credit contributes to providing capital for the industrialization and modernization cause in Ho Chi Minh City" - Economic Development Magazine No. 162.

2. Nguyen Quoc Anh - "Anti-inflation monetary policy - Viewed from theoretical and practical perspectives in Vietnam today" - Economic Development Magazine No. 210

3. Nguyen Quoc Anh - Experience in developing housing credit for low-income people in some countries and some solutions to solve housing problems for low-income people in Ho Chi Minh City - Banking Magazine No. 14, July 2013.

4. Nguyen Quoc Anh – Banking characteristics affecting the transmission of monetary policy through bank credit channels in Vietnam – Economic Development Journal No. 276s, October 2013.

5. Nguyen Quoc Anh – “Equitization and international integration of the Vietnamese banking system. Key issues that need to be resolved” – Scientific workshop “International integration of banking and the issue of equitization of state-owned commercial banks”.

6. Nguyen Quoc Anh - "Discussion on bad debt handling of Vietnamese commercial banks" - Scientific workshop "Accompanying businesses to overcome challenges for integration and development" - Institute for Development Studies - Ho Chi Minh City People's Committee.

7. Nguyen Quoc Anh – Factors affecting credit risk – empirical evidence at Vietnamese commercial banks – An Giang University Science Journal, special issue, December 2015.

8. Nguyen Quoc Anh - The impact of financial risks on the bankruptcy of Vietnamese commercial banks - Development & Integration Magazine, University of Economics and Finance, Ho Chi Minh City, No. 27, March-April 2016.

9. Nguyen Quoc Anh - The impact of credit risk on business performance of Vietnamese commercial banks - Development & Integration Magazine, University of Economics and Finance, Ho Chi Minh City, No. 29, July-August 2016.

B. SCIENTIFIC RESEARCH TOPIC

1. Ministry level topics:

Main solutions to build a strong banking system to meet the requirements of industrialization and modernization in Vietnam today

- Topic leader: Associate Professor, Dr. Nguyen Dang Don

- Join as: member

Research on solutions to develop international banking operations of commercial banks in Vietnam

- Topic leader: Associate Professor, Dr. Tran Huy Hoang

- Join as: member

Solutions to increase the attraction of foreign indirect investment capital into Vietnam's stock market

- Topic leader: Dr. Bui Kim Yen

- Join as: member

Building a model of strategic cooperation and association of Vietnamese commercial banks to enhance competitiveness and development when integrating into the WTO

- Topic leader: Associate Professor, Dr. Nguyen Dang Don

- Join as: member

Risk management of small and medium enterprises in Ho Chi Minh City in the period 2011-2020

- Topic: Master Ma Van Tue

- Join as: member

Interest rate risk management in business operations of Vietnamese commercial banks in Ho Chi Minh City in the period 2011-2020 according to BASEL III standards

- Topic leader: Associate Professor, Dr. Tran Huy Hoang

- Join as: member

2. School level topics:

Solutions to improve the operations of debt management and asset exploitation companies to overcome credit risks at commercial banks in Vietnam

- Code: CS - 2003 - 05

- Topic leader: Dr. Tran Huy Hoang

- Join as: member

Solutions to improve credit quality of Vietnamese commercial banks in the process of international integration

- Code: CS - 2004 - 19

- Topic: Dr. Tram Thi Xuan Huong

- Join as: member

Developing housing credit for low-income people at commercial banks in Ho Chi Minh City

- Code: CS - 2011 - 43

- Topic: Master Nguyen Quoc Anh

Factors affecting credit risk – empirical evidence at Vietnamese commercial banks

- Code: CS - 2015 - 83

- Topic: Master Nguyen Quoc Anh

REFERENCES

Vietnamese

1. Do Quynh Anh and Nguyen Duc Hung, 2013. Empirical analysis of determinants of bad debt at Vietnamese commercial banks. Economic and Policy Research. http://dl.ueb.edu.vn/handle/1247/10499 .

2. Dao Thi Thanh Binh and Do Van Anh, 2013. Bad Debts in Vietnamese Banks - Quantitative Analysis and Recommendations. (November 26, 2013). Available at SSRN: http://ssrn.com/abstract=2524223 or http://dx.doi.org/10.2139/ssrn.2524223

3. Nguyen Thi Ngoc Diep, Nguyen Minh Kieu, 2015. The impact of characteristic factors on credit risk of Vietnamese commercial banks. Journal of Economic Development 2015. No. 3. pp. 49 – 63.

4. Nguyen Thanh Duong, 2013. Risk analysis in banking activities. Development and integration magazine, No. 9 (19), pp. 29-39.

5. Nguyen Viet Hung, 2008. Analysis of factors affecting the operational efficiency of commercial banks in Vietnam. PhD thesis. National Economics University.

6. Nguyen Minh Kieu, 2009. Commercial Banking Operations . Ho Chi Minh City. Publishing House: Statistical Publishing House.

7. Trinh Quoc Trung, Nguyen Van Sang, 2013. Factors affecting the performance of Vietnamese commercial banks. Banking technology magazine, No. 85, April 2013.

8. Tran Huy Hoang, 2011. Commercial bank management textbook . Hanoi: Social labor publishing house.

9. Vo Thi Quy, Bui Ngoc Toan, 2014. Factors affecting credit risk of Vietnam's commercial banking system. Ho Chi Minh City Open University Science Journal - No. 3 (36) 2014.

English

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