III. Capital efficiency and profitability
1. Asset utilization efficiency (DTts)
This coefficient shows the results that the enterprise achieved during the year through generating income on total assets put into production and business activities.
DTts =
Revenue (MS 10+21+31KQHDKD)
Total assets (MS 270BCDKT)
This ratio reflects the dynamism of the enterprise, indicating how many times the total capital invested in assets is converted into revenue. If this ratio is low, it means that capital is not being used effectively; it is possible that the enterprise has excess inventory, unsold products or idle assets or borrowed too much money compared to the actual capital needs. (Note that for large-scale enterprises, this ratio tends to be smaller than for small-scale enterprises).
2. Inventory turnover (V)
Inventory turnover ratio evaluates the performance of a business through the efficiency of working capital use. The larger the inventory turnover value, the more effectively the business uses working capital.
Cost of goods sold (MS 11KQHDKD)
V =
Average inventory (MS 140BCĐKT)
3. Average collection period (N)
N = Average receivables (MS 130BCĐKT) Net revenue (MS 10+21+31KQHDKD)
x 360 days
face.
This ratio reflects the number of days required to convert receivables into cash.
Average collection period measures the average time value of receivables.
of the enterprise. The average collection period depends on the size of the enterprise and the characteristics of each production and business industry. The shorter the average collection period, the faster the turnover of receivables, indicating the higher efficiency of the enterprise's use of capital.
4. Return on Total Capital Employed
LNnv =
Total profit before tax (MS 50KQHĐKD) Total average capital (MS 440BCĐKT)
5. Net operating profit margin on Total capital employed
Total net profit (MS 30KQHDKD)
LNkd =
Average total capital (MS 440BCĐKT)
6. Return on Equity
Total profit before tax (MS 50KQHDKD)
LNnv =
Owner's equity (MS 400BCDKT)
7. Operating Profit Margin on Equity
Total net profit (MS 30KQHDKD)
LNkd =
Owner's equity (MS 400BCDKT)
8. Profit margin on revenue
Total profit before tax (MS 50KQHDKD)
LN dt =
Revenue (MS 10+21+31KQHDKD)
The above profit margin indicators are general assessment indicators of the financial situation and business performance of the enterprise.
The higher these ratios are, the more efficient the business is; conversely, it shows that the business is facing difficulties in its business activities, requiring the business to take remedial measures. This situation warns of potential risks in granting credit to the business.
IV. Growth (TT)
Growth ratios help analysts understand the growth and expansion of a company. They indicate the annual growth in a company’s revenue and profits. Ideally, revenue growth should be accompanied by profit growth.
1. Revenue growth
1.1. Revenue growth rate
TTdt =
Next year's revenue (MS 10+21+31KQHDKD) - 1
Last year's revenue (MS 10+21+31KQHDKD)
1.2. Growth rate of revenue from core business activities
TTdtc =
Revenue from main business activities next year (MS 10+21KQHDKD) - 1
Revenue from main business activities of previous year (MS 10+21KQHDKD)
This is an important indicator reflecting the level of revenue growth of the enterprise that needs to be recorded:
- Compared to inflation target: if revenue growth target increases but inflation decreases or does not increase, the growth rate is in a good direction, the number of consumed goods increases (and vice versa).
- Compare market growth rate: if it is smaller, it means that the enterprise is having difficulty in competitiveness and market share.
2. Profit growth
2.1. Profit growth rate
Total profit next year (MS 50KQHDKD)
TTln =
- 1
Total profit last year (MS 50KQHDKD)
2.2. Net profit growth rate from core business activities
Total net profit next year (MS 30KQHDKD)
TTlnt =
- 1
Total net profit last year (MS 30KQHDKD)
This is an index to consider the growth rate of the company's profits. When the growth rate of revenue is evaluated in terms of quantity, this ratio is evaluated in terms of quality expansion.
Appendix 5. Instructions for calculating the economic and financial efficiency of the project
I. Project discount rate (r)
In case the project is invested with different capital sources, r is calculated by the weighted average method:
V1r1+V2r2+….+Vtcrtc
r =
V1+v2+…+Vtc
In there:
- V1,V2,.. Long-term loan sources
- VTC: owner's own capital or self-mobilized capital of the investor
- r1, r2,..: loan interest rate
- rtc: desired discount rate (cost of capital rate) of the investor
II. Present value of the project
It is the ratio between the present value of income stream and the present value of cost stream determined in the project life cycle. The project is only effective when the profitability index >1.
1
n i=1 B i
( 1 + r) i
B/C =
1
In there :
n i=1 C i
( 1 + r) i
* B i : Total income of the project in year i B i = B + T kh + V b
Including: - B: Annual revenue of the project
- T kh : Other revenues
- V b : Undiscounted remaining value of fixed assets in the final calculation year
* C i : Total cost of the project in year i
Ci = It + C ot
Including: - I t : Total investment cost
- C ot : Annual operating cost of the project C ot = C t - (D t + L t ) + T n
Including: - C t : Annual cost of the project
- Annual depreciation of fixed assets
- L t : Interest on loans is included in the product cost.
- T n : Taxes (including: VAT + Vk + Vtn)
* r: Selected discount rate
Meaning :Present value of profit shows how much present value of income can be obtained for every dollar of present value of cost incurred in the project.
- Case B/C>1: The higher the project's present value, the greater the project's financial efficiency.
- Case B/C<1: The project has poor financial efficiency, the project's income is not enough to cover the costs.
III. Net Present Value (NPV)
The net present value of a project is the difference between the present value of benefits and the present value of costs over the life of the project.
NPV =
n i=1 (B i – C i )
1
( 1 + r) i
* Meaning: Net present value of income represents the relationship comparing the absolute value between the present value of benefits and the present value of costs.
- Case where NPV(r) >0: The larger the NPV of the project, the higher the financial efficiency of the project.
- In case NPV(r) <0: The project has weak financial efficiency and is unable to repay the loan as prescribed.
IV. Internal Rate of Return (IRR)
The internal rate of return of a project is the discount rate at which the net present value of the project =0.
NPV 1
IRR = r 1 + [ (r 2 - r 1 )
NPV 1 + NPV 2
In there:
* r 1 : Initial discount rate to calculate NPV 1 so that NPV 1 >0
* r 2 : Initial discount rate to calculate NPV 2 so that NPV 2 <0 (with r 2 > r 1 )
* Meaning: Internal rate of return (IRR) indicates the profitability of capital invested in the project.
If the project has IRR > cost of capital, the project is financially efficient. The larger the IRR, the more financially efficient the project is.
If the project has IRR < cost of capital, the project has low financial efficiency.
VII. Calculating the sensitivity of investment projects
The effectiveness of a project depends largely on the factors forecasted during project planning. Forecasts can be misleading, especially when changes occur in the future. Therefore, it is necessary to evaluate the stability of the project's effectiveness indicators.
Depending on each specific project, sensitivity analysis can be selected according to one or more indicators. The indicators for analysis are those (according to the experience of professional staff) that often have fluctuations affecting the economic efficiency (NPV, IRR, ...) of the project such as:
- Input prices increase;
- Low power output;
- Low product consumption;
- Interest rates,…
If the recalculated indicators still meet the requirements, the project is considered stable and approved.
Appendix 6. Survey form
University of Economics Questionnaire code: …
Hue University
SURVEY FORM
Dear Sir/Madam, I am a final year student from class K43A - Investment Planning - Hue University of Economics. Currently, I am doing an internship at the Vietnam Development Bank, Thua Thien Hue Branch with the topic: "Appraisal of State development investment credit loan projects". The topic is carried out to learn about the appraisal of State development investment credit loan projects at Thua Thien Hue Branch. Thereby, proposing solutions to improve the quality of appraisal work. I look forward to receiving your comments according to the form below. I hereby commit that all your information will be kept confidential and only used for research purposes. Sincerely thank you!
Please let us know:
Question 1: Type (Field) of project:
Industry
Traffic
Agriculture – Forestry – Irrigation – Fisheries
Public works
State management
Health - Education - Culture - Society - Sports
National security
Production and business
Other
Question 2 : What is the total investment of the project?
1 – 10 billion VND
10 – 15 billion VND
15 – 20 billion VND
Over 20 billion VND
Question 3: What is the total investment amount that the bank lends?
Under 30% of total investment
From 30% to 50% of total investment
From 50% to 70% of total investment
Over 70% of total investment
Question 4: Loan type:
Short term Medium term Long term
Question 5: Form of guarantee
Mortgage Credit Both mortgage and credit
Question 6: Using borrowed capital
Right on target Partly wrong on target Wrong on target
Question 7: Ability to repay principal and interest
Early repayment On-time repayment Late repayment
Question 8: Efficiency of loan use
Very good Good Average Poor
Question 9: In addition to borrowing capital at BDV Thua Thien Hue, do customers borrow capital from other credit institutions?
Only borrow from BDV Thua Thien Hue borrow from other organizations
Question 10: Time for appraisal and approval at Thua Thien Hue Branch
Under 10 days
10 – 20 days
20 – 40 days
Over 40 days
Question 11: How do you evaluate the appraisal and approval time at Thua Thien Hue Branch?
Fast Normal Slow Too slow
Question 12: Do you have to pay additional transaction costs?
Yes No
Question 13: After conducting the appraisal, was the project approved by the Branch or not? (If not, please state the reason why?)
Yes
No
................................................................................................................................................
................................................................................................................................................
................................................................................................................................
Question 14: Please indicate your level of agreement with the factors affecting the appraisal of State development investment credit loan projects at the Branch below on a scale of 1-5.
(1=strongly disagree, 2=disagree, 3=neutral, 4=agree, 5=strongly agree)
Document reception
Question 14.1 | Receiving and checking application appraisal documents Simple, fast. (With valid documents) | | | | | |
Question 14.2 | Specific and dedicated instructions for investors to edit and set a specific resubmission date (For invalid documents) | | | | | |
Question 14.3 | Time to arrange appraisal meeting schedule after receiving full quick appraisal file | | | | | |
Question 14.4 | Time to notify appraisal conclusion from date Appraisal meeting as scheduled | | | | | |
Information | ||||||
Question 14.5 | Complete and accurate information collected about the project be appraised | | | | | |
Question 14.6 | Fast information collection, processing and analysis process fast | | | | | |
Question 14.7 | The process of storing information completely, safely and securely honey | | | | | |
Appraisal content and legal environment | ||||||
Question 14.8 | Has scientific appraisal content appropriate to the nature quality of the project | | | | | |
Question 14.9 | Assess the completeness and validity of project documents and records investor profile | | | | | |
Question 14.10 | The legal document system is fully updated for appraisal work as well as investment decision making. private. | | | | | |
Maybe you are interested!
-
![Pre-tax Profit of Bidv Tien Giang in the Period 2011-2015
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zt2a3gsnon-credit services, joint stock commercial bank
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At that time, the Branch had to set aside a provision for credit risks, which reduced the Branchs income.
Chart 2.2. Pre-tax profit of BIDV Tien Giang in the period 2011-2015
Unit: Billion VND
140
120
100
80
60
40
20
0
63.3
80.34
89.29
110.08
131.99
2011 2012 2013 2014 2015
Profit before tax
(Source: Report on the implementation of the annual business plan of the General Planning Department of BIDV Tien Giang [24])
However, through chart 2.2, it can be seen that BIDV Tien Giangs profit is still increasing continuously, and its operating efficiency is currently leaking. This is a contribution of non-credit services, and this service segment will be increasingly focused on growth by BIDV Tien Giang to ensure the highest profit safety because credit activities have many potential risks. At the same time, focusing on developing non-credit services is consistent with one of the contents of restructuring the financial activities of credit institutions in the project Restructuring the system of credit institutions in the period 2011-2015 approved by the Prime Minister in Decision No. 254/QD-TTg dated March 1, 2012 [14]: Gradually shifting the business model of commercial banks towards reducing dependence on credit activities and increasing income from non-credit services.
2.2. Current status of non-credit service development at BIDV Tien Giang.
2.2.1. BIDV Tien Giang has deployed the development of non-credit services in recent times.
Along with the development of the Head Office, BIDV Tien Giangs products and services are constantly improved and deployed in a diverse manner to ensure provision for many different customer groups in the area: individual customers, corporate customers, and financial institutions. Typical services are as follows: Payment services, treasury services, guarantee services, card services, trade finance, other services: Western Union, insurance commissions, consulting services, foreign exchange derivatives trading, e-banking services,...
2.2.1.1. Payment services:
In accordance with the Prime Ministers Project to promote non-cash payments in Vietnam [15], banks in Tien Giang province have continuously developed payment services to reduce customers cash usage habits through card services and electronic banking services such as: salary payment through accounts, focusing on developing card acceptance points, developing multi-purpose cards, paying social insurance by transfer, paying bills through banks, etc.
Chart 2.3. Net income from payment services in the period 2011-2015
Unit: Million VND
6000
5000
4000
3000
2000
1000
0
3922 4065
4720 5084 5324
2011 2012 2013 2014 2015
Net income from payment services
(Source: Report on the implementation of the annual business plan of the General Planning Department of BIDV Tien Giang [24])
Along with the technological development of the entire system, BIDV Tien Giang has a payment system with a fairly stable transaction processing speed, bringing many conveniences to customers. The results of observing chart 2.3 show that the income from payment services that the Branch has achieved has grown over the years but the speed is not high and the products are not outstanding compared to other banks. Domestic payment products such as: Online bill payment, electricity bills, water bills, insurance premiums, cable TV bills, telecommunications fees, airline tickets, etc. bring many conveniences to customers. Regarding international payment, this is an indispensable activity for foreign economic activities, BIDV Tien Giang is providing international payment methods for small enterprises producing agriculture, aquatic food and seafood that have credit relationships with banks in industrial parks in Tien Giang province such as: money transfer, collection, L/C payment.
2.2.1.2. Treasury services:
BIDV Tien Giang always focuses on ensuring treasury safety and currency security, always complies with legal regulations, and minimizes risks in operations such as: counting and collecting money from customers, receiving and delivering internal transactions, collecting from the State Bank (SBV) or other credit institutions, receiving ATM funds, bundling money, etc. BIDV Tien Giangs treasury service management department is always fully equipped with modern machinery and equipment such as: money transport vehicles, fire prevention tools, money counters, money detectors, magnifying glasses, etc. to ensure absolute safety in treasury operations, immediately identifying real and fake money and other risks that may affect people and assets of the bank and customers. In addition, implementing regulation 2480/QC dated October 28, 2008 between the State Bank of Tien Giang province and the Provincial Police on coordination in the fight against counterfeit money, in the 3-year review of implementation, BIDV Tien Giang discovered, seized and submitted to the State Bank of Tien Giang province 475 banknotes of various denominations and was commended by the Provincial Police and the State Bank of Tien Giang province [17].
Chart 2.4. Net income from treasury services in the period 2011-2015
Unit: Million VND
350
300
250
200
150
100
50
0
105 122
309 289 279
2011 2012 2013 2014 2015
Net income from treasury services
(Source: Report on the implementation of the annual business plan of the General Planning Department of BIDV Tien Giang [24])
However, as shown in Figure 2.4, income from treasury operations is not high and fluctuates. Specifically, in the period 2011-2013, net income increased and increased most sharply in 2013, then in the period 2013-2015, there was a downward trend. This fluctuation is due to the fact that fees collected from treasury services are often very low and can even be waived to attract customers to use other services.
2.2.1.3. Guarantee and trade finance services:
BIDV Tien Giang, thanks to the advantages of the province and the favorable location of the Branch, has continuously focused on developing income from guarantee services and trade finance.
Chart 2.5. Net income from guarantee and trade finance services in the period 2011-2015
Unit: Million VND
14000
12000
10000
8000
6000
4000
2000
0
5193 5695
2742 3420
8889
3992
11604 12206
5143 5312
2011 2012 2013 2014 2015
Net income from guarantee services Net income from Trade Finance
(Source: Report on the implementation of the annual business plan of the General Planning Department of BIDV Tien Giang [24])
Through chart 2.5, we can see that BIDV Tien Giangs income from guarantee services and trade finance has grown over the years. The reason is: Among BIDV Tien Giangs corporate customers, the construction industry is the industry with the highest proportion of customers after the trading industry, this is a group of customers with potential to develop guarantee services. The second group of customers is corporate customers in the fields of agricultural production, livestock and seafood processing with high import and export turnover in the area.
are the target of trade finance development. In addition, BIDV Tien Giang also focuses on continuously developing these customer groups to increase revenue for many other products and services in the future.
2.2.1.4. Card and POS services:
As a service that BIDV Tien Giang has recently developed strongly, it can be said that this is a very potential market and has the ability to develop even more strongly in the future. Card services with outstanding advantages such as fast payment time, wide payment range, quite safe, effective and suitable for the integration trend and the Project to promote non-cash payments in Vietnam. Cards have become a modern and popular payment tool. BIDV Tien Giang early identified that developing card services is to expand the market to people in society, create capital mobilized from card-opened accounts, contribute to diversifying banking activities, enhance the image of the bank, bring the BIDV Tien Giang brand to people as quickly and easily as possible. BIDV Tien Giang is currently providing card types such as: credit cards (BIDV MasterCard Platinum, BIDV Visa Gold Precious, BIDV Visa Manchester United, BIDV Visa Classic), international debit cards (BIDV Ready Card, BIDV Manu Debit Card), domestic debit cards (BIDV Harmony Card, BIDV eTrans Card, BIDV Moving Card, BIDV-Lingo Co-branded Card, BIDV-Co.opmart Co-branded Card). These cards can be paid via POS/EDC or on the ATM system. In addition, with debit cards, customers can not only withdraw money via ATMs but also perform utilities such as mobile top-up, online payment, money transfer,... through electronic banking services.
In order to attract customers with card services, BIDV Tien Giang has continuously increased the installation of ATMs. As of December 31, 2015, BIDV Tien Giang has 23 ATMs combined with 7 ATMs in the same system of BIDV My Tho, so the number of ATMs is quite large, especially in the center of My Tho City, but is not yet fully present in the districts. Basic services on ATMs such as withdrawing money, checking balances, printing short statements,... BIDV ATMs accept cards from banks in the system.
Banknetvn and Smartlink, cards branded by international card organizations Union Pay (CUP), VISA, MasterCard and cards of banks in the Asian Payment Network. From here, cardholders can make bill payments for themselves or others at ATMs, by simply entering the subscriber number or customer code, booking code that service providers notify and make bill payments.
Chart 2.6. Net income from card services in the period 2011-2015
Unit: Million VND
3500
3000
2500
2000
1500
1000
500
0
687
1023
1547
2267
3104
2011 2012 2013 2014 2015
Net income from card services
(Source: Report on the implementation of the annual business plan of the General Planning Department of BIDV Tien Giang [24])
Through chart 2.6, it can be seen that BIDV Tien Giangs card service income is constantly growing because the Branch focuses on developing businesses operating in industrial parks, which are the source of customers for salary payment products, ATMs, BSMS. Specifically, there are companies such as Freeview, Quang Viet, Dai Thanh, which are businesses with a large number of card openings at the Branch, contributing to the increase in card service fees [25].
Table 2.6. Number of ATMs and POS machines in 2015 of some banks in Tien Giang area.
Unit: Machine
STT
Bank name
Number of ATMs
Cumulative number of ATM cards
POS machine
1
BIDV Tien Giang
23
97,095
22
2
BIDV My Tho
7
21,325
0
3
Agribank Tien Giang
29
115,743
77
4
Vietinbank Tien Giang
16
100,052
54
5
Dong A Tien Giang
26
97,536
11
6
Sacombank Tien Giang
24
88,513
27
7
Vietcombank Tien Giang
15
61,607
96
8
Vietinbank - Tay Tien Giang Branch
6
46,042
38
(Source: 2015 Banking Activity Data Report of the General and Internal Control Department of the Provincial State Bank [21])
Through table 2.6, the author finds that the number of ATMs of BIDV Tien Giang is not much, ranking fourth after Agribank Tien Giang, Dong A Tien Giang, Sacombank Tien Giang. The number of POS machines of BIDV Tien Giang is very small, only higher than Dong A Tien Giang and BIDV My Tho in the initial stages of merging the BIDV system. Besides, BIDV Tien Giang has a high number of cards increasing over the years (table 2.7) but the cumulative number of cards issued up to December 31, 2015 is still relatively low compared to Agribank, Vietcombank, Dong A (table 2.6).
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![Pre-tax Profit of Bidv Tien Giang in the Period 2011-2015
zt2i3t4l5ee
zt2a3gsnon-credit services, joint stock commercial bank
zt2a3ge
zc2o3n4t5e6n7ts
At that time, the Branch had to set aside a provision for credit risks, which reduced the Branchs income.
Chart 2.2. Pre-tax profit of BIDV Tien Giang in the period 2011-2015
Unit: Billion VND
140
120
100
80
60
40
20
0
63.3
80.34
89.29
110.08
131.99
2011 2012 2013 2014 2015
Profit before tax
(Source: Report on the implementation of the annual business plan of the General Planning Department of BIDV Tien Giang [24])
However, through chart 2.2, it can be seen that BIDV Tien Giangs profit is still increasing continuously, and its operating efficiency is currently leaking. This is a contribution of non-credit services, and this service segment will be increasingly focused on growth by BIDV Tien Giang to ensure the highest profit safety because credit activities have many potential risks. At the same time, focusing on developing non-credit services is consistent with one of the contents of restructuring the financial activities of credit institutions in the project Restructuring the system of credit institutions in the period 2011-2015 approved by the Prime Minister in Decision No. 254/QD-TTg dated March 1, 2012 [14]: Gradually shifting the business model of commercial banks towards reducing dependence on credit activities and increasing income from non-credit services.
2.2. Current status of non-credit service development at BIDV Tien Giang.
2.2.1. BIDV Tien Giang has deployed the development of non-credit services in recent times.
Along with the development of the Head Office, BIDV Tien Giangs products and services are constantly improved and deployed in a diverse manner to ensure provision for many different customer groups in the area: individual customers, corporate customers, and financial institutions. Typical services are as follows: Payment services, treasury services, guarantee services, card services, trade finance, other services: Western Union, insurance commissions, consulting services, foreign exchange derivatives trading, e-banking services,...
2.2.1.1. Payment services:
In accordance with the Prime Ministers Project to promote non-cash payments in Vietnam [15], banks in Tien Giang province have continuously developed payment services to reduce customers cash usage habits through card services and electronic banking services such as: salary payment through accounts, focusing on developing card acceptance points, developing multi-purpose cards, paying social insurance by transfer, paying bills through banks, etc.
Chart 2.3. Net income from payment services in the period 2011-2015
Unit: Million VND
6000
5000
4000
3000
2000
1000
0
3922 4065
4720 5084 5324
2011 2012 2013 2014 2015
Net income from payment services
(Source: Report on the implementation of the annual business plan of the General Planning Department of BIDV Tien Giang [24])
Along with the technological development of the entire system, BIDV Tien Giang has a payment system with a fairly stable transaction processing speed, bringing many conveniences to customers. The results of observing chart 2.3 show that the income from payment services that the Branch has achieved has grown over the years but the speed is not high and the products are not outstanding compared to other banks. Domestic payment products such as: Online bill payment, electricity bills, water bills, insurance premiums, cable TV bills, telecommunications fees, airline tickets, etc. bring many conveniences to customers. Regarding international payment, this is an indispensable activity for foreign economic activities, BIDV Tien Giang is providing international payment methods for small enterprises producing agriculture, aquatic food and seafood that have credit relationships with banks in industrial parks in Tien Giang province such as: money transfer, collection, L/C payment.
2.2.1.2. Treasury services:
BIDV Tien Giang always focuses on ensuring treasury safety and currency security, always complies with legal regulations, and minimizes risks in operations such as: counting and collecting money from customers, receiving and delivering internal transactions, collecting from the State Bank (SBV) or other credit institutions, receiving ATM funds, bundling money, etc. BIDV Tien Giangs treasury service management department is always fully equipped with modern machinery and equipment such as: money transport vehicles, fire prevention tools, money counters, money detectors, magnifying glasses, etc. to ensure absolute safety in treasury operations, immediately identifying real and fake money and other risks that may affect people and assets of the bank and customers. In addition, implementing regulation 2480/QC dated October 28, 2008 between the State Bank of Tien Giang province and the Provincial Police on coordination in the fight against counterfeit money, in the 3-year review of implementation, BIDV Tien Giang discovered, seized and submitted to the State Bank of Tien Giang province 475 banknotes of various denominations and was commended by the Provincial Police and the State Bank of Tien Giang province [17].
Chart 2.4. Net income from treasury services in the period 2011-2015
Unit: Million VND
350
300
250
200
150
100
50
0
105 122
309 289 279
2011 2012 2013 2014 2015
Net income from treasury services
(Source: Report on the implementation of the annual business plan of the General Planning Department of BIDV Tien Giang [24])
However, as shown in Figure 2.4, income from treasury operations is not high and fluctuates. Specifically, in the period 2011-2013, net income increased and increased most sharply in 2013, then in the period 2013-2015, there was a downward trend. This fluctuation is due to the fact that fees collected from treasury services are often very low and can even be waived to attract customers to use other services.
2.2.1.3. Guarantee and trade finance services:
BIDV Tien Giang, thanks to the advantages of the province and the favorable location of the Branch, has continuously focused on developing income from guarantee services and trade finance.
Chart 2.5. Net income from guarantee and trade finance services in the period 2011-2015
Unit: Million VND
14000
12000
10000
8000
6000
4000
2000
0
5193 5695
2742 3420
8889
3992
11604 12206
5143 5312
2011 2012 2013 2014 2015
Net income from guarantee services Net income from Trade Finance
(Source: Report on the implementation of the annual business plan of the General Planning Department of BIDV Tien Giang [24])
Through chart 2.5, we can see that BIDV Tien Giangs income from guarantee services and trade finance has grown over the years. The reason is: Among BIDV Tien Giangs corporate customers, the construction industry is the industry with the highest proportion of customers after the trading industry, this is a group of customers with potential to develop guarantee services. The second group of customers is corporate customers in the fields of agricultural production, livestock and seafood processing with high import and export turnover in the area.
are the target of trade finance development. In addition, BIDV Tien Giang also focuses on continuously developing these customer groups to increase revenue for many other products and services in the future.
2.2.1.4. Card and POS services:
As a service that BIDV Tien Giang has recently developed strongly, it can be said that this is a very potential market and has the ability to develop even more strongly in the future. Card services with outstanding advantages such as fast payment time, wide payment range, quite safe, effective and suitable for the integration trend and the Project to promote non-cash payments in Vietnam. Cards have become a modern and popular payment tool. BIDV Tien Giang early identified that developing card services is to expand the market to people in society, create capital mobilized from card-opened accounts, contribute to diversifying banking activities, enhance the image of the bank, bring the BIDV Tien Giang brand to people as quickly and easily as possible. BIDV Tien Giang is currently providing card types such as: credit cards (BIDV MasterCard Platinum, BIDV Visa Gold Precious, BIDV Visa Manchester United, BIDV Visa Classic), international debit cards (BIDV Ready Card, BIDV Manu Debit Card), domestic debit cards (BIDV Harmony Card, BIDV eTrans Card, BIDV Moving Card, BIDV-Lingo Co-branded Card, BIDV-Co.opmart Co-branded Card). These cards can be paid via POS/EDC or on the ATM system. In addition, with debit cards, customers can not only withdraw money via ATMs but also perform utilities such as mobile top-up, online payment, money transfer,... through electronic banking services.
In order to attract customers with card services, BIDV Tien Giang has continuously increased the installation of ATMs. As of December 31, 2015, BIDV Tien Giang has 23 ATMs combined with 7 ATMs in the same system of BIDV My Tho, so the number of ATMs is quite large, especially in the center of My Tho City, but is not yet fully present in the districts. Basic services on ATMs such as withdrawing money, checking balances, printing short statements,... BIDV ATMs accept cards from banks in the system.
Banknetvn and Smartlink, cards branded by international card organizations Union Pay (CUP), VISA, MasterCard and cards of banks in the Asian Payment Network. From here, cardholders can make bill payments for themselves or others at ATMs, by simply entering the subscriber number or customer code, booking code that service providers notify and make bill payments.
Chart 2.6. Net income from card services in the period 2011-2015
Unit: Million VND
3500
3000
2500
2000
1500
1000
500
0
687
1023
1547
2267
3104
2011 2012 2013 2014 2015
Net income from card services
(Source: Report on the implementation of the annual business plan of the General Planning Department of BIDV Tien Giang [24])
Through chart 2.6, it can be seen that BIDV Tien Giangs card service income is constantly growing because the Branch focuses on developing businesses operating in industrial parks, which are the source of customers for salary payment products, ATMs, BSMS. Specifically, there are companies such as Freeview, Quang Viet, Dai Thanh, which are businesses with a large number of card openings at the Branch, contributing to the increase in card service fees [25].
Table 2.6. Number of ATMs and POS machines in 2015 of some banks in Tien Giang area.
Unit: Machine
STT
Bank name
Number of ATMs
Cumulative number of ATM cards
POS machine
1
BIDV Tien Giang
23
97,095
22
2
BIDV My Tho
7
21,325
0
3
Agribank Tien Giang
29
115,743
77
4
Vietinbank Tien Giang
16
100,052
54
5
Dong A Tien Giang
26
97,536
11
6
Sacombank Tien Giang
24
88,513
27
7
Vietcombank Tien Giang
15
61,607
96
8
Vietinbank - Tay Tien Giang Branch
6
46,042
38
(Source: 2015 Banking Activity Data Report of the General and Internal Control Department of the Provincial State Bank [21])
Through table 2.6, the author finds that the number of ATMs of BIDV Tien Giang is not much, ranking fourth after Agribank Tien Giang, Dong A Tien Giang, Sacombank Tien Giang. The number of POS machines of BIDV Tien Giang is very small, only higher than Dong A Tien Giang and BIDV My Tho in the initial stages of merging the BIDV system. Besides, BIDV Tien Giang has a high number of cards increasing over the years (table 2.7) but the cumulative number of cards issued up to December 31, 2015 is still relatively low compared to Agribank, Vietcombank, Dong A (table 2.6).
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Pre-tax Profit of Bidv Tien Giang in the Period 2011-2015
zt2i3t4l5ee
zt2a3gsnon-credit services, joint stock commercial bank
zt2a3ge
zc2o3n4t5e6n7ts
At that time, the Branch had to set aside a provision for credit risks, which reduced the Branch's income.
Chart 2.2. Pre-tax profit of BIDV Tien Giang in the period 2011-2015
Unit: Billion VND
140
120
100
80
60
40
20
0
63.3
80.34
89.29
110.08
131.99
2011 2012 2013 2014 2015
Profit before tax
(Source: Report on the implementation of the annual business plan of the General Planning Department of BIDV Tien Giang [24])
However, through chart 2.2, it can be seen that BIDV Tien Giang's profit is still increasing continuously, and its operating efficiency is currently leaking. This is a contribution of non-credit services, and this service segment will be increasingly focused on growth by BIDV Tien Giang to ensure the highest profit safety because credit activities have many potential risks. At the same time, focusing on developing non-credit services is consistent with one of the contents of restructuring the financial activities of credit institutions in the project "Restructuring the system of credit institutions in the period 2011-2015" approved by the Prime Minister in Decision No. 254/QD-TTg dated March 1, 2012 [14]: "Gradually shifting the business model of commercial banks towards reducing dependence on credit activities and increasing income from non-credit services".
2.2. Current status of non-credit service development at BIDV Tien Giang.
2.2.1. BIDV Tien Giang has deployed the development of non-credit services in recent times.
Along with the development of the Head Office, BIDV Tien Giang's products and services are constantly improved and deployed in a diverse manner to ensure provision for many different customer groups in the area: individual customers, corporate customers, and financial institutions. Typical services are as follows: Payment services, treasury services, guarantee services, card services, trade finance, other services: Western Union, insurance commissions, consulting services, foreign exchange derivatives trading, e-banking services,...
2.2.1.1. Payment services:
In accordance with the Prime Minister's Project to promote non-cash payments in Vietnam [15], banks in Tien Giang province have continuously developed payment services to reduce customers' cash usage habits through card services and electronic banking services such as: salary payment through accounts, focusing on developing card acceptance points, developing multi-purpose cards, paying social insurance by transfer, paying bills through banks, etc.
Chart 2.3. Net income from payment services in the period 2011-2015
Unit: Million VND
6000
5000
4000
3000
2000
1000
0
3922 4065
4720 5084 5324
2011 2012 2013 2014 2015
Net income from payment services
(Source: Report on the implementation of the annual business plan of the General Planning Department of BIDV Tien Giang [24])
Along with the technological development of the entire system, BIDV Tien Giang has a payment system with a fairly stable transaction processing speed, bringing many conveniences to customers. The results of observing chart 2.3 show that the income from payment services that the Branch has achieved has grown over the years but the speed is not high and the products are not outstanding compared to other banks. Domestic payment products such as: Online bill payment, electricity bills, water bills, insurance premiums, cable TV bills, telecommunications fees, airline tickets, etc. bring many conveniences to customers. Regarding international payment, this is an indispensable activity for foreign economic activities, BIDV Tien Giang is providing international payment methods for small enterprises producing agriculture, aquatic food and seafood that have credit relationships with banks in industrial parks in Tien Giang province such as: money transfer, collection, L/C payment.
2.2.1.2. Treasury services:
BIDV Tien Giang always focuses on ensuring treasury safety and currency security, always complies with legal regulations, and minimizes risks in operations such as: counting and collecting money from customers, receiving and delivering internal transactions, collecting from the State Bank (SBV) or other credit institutions, receiving ATM funds, bundling money, etc. BIDV Tien Giang's treasury service management department is always fully equipped with modern machinery and equipment such as: money transport vehicles, fire prevention tools, money counters, money detectors, magnifying glasses, etc. to ensure absolute safety in treasury operations, immediately identifying real and fake money and other risks that may affect people and assets of the bank and customers. In addition, implementing regulation 2480/QC dated October 28, 2008 between the State Bank of Tien Giang province and the Provincial Police on coordination in the fight against counterfeit money, in the 3-year review of implementation, BIDV Tien Giang discovered, seized and submitted to the State Bank of Tien Giang province 475 banknotes of various denominations and was commended by the Provincial Police and the State Bank of Tien Giang province [17].
Chart 2.4. Net income from treasury services in the period 2011-2015
Unit: Million VND
350
300
250
200
150
100
50
0
105 122
309 289 279
2011 2012 2013 2014 2015
Net income from treasury services
(Source: Report on the implementation of the annual business plan of the General Planning Department of BIDV Tien Giang [24])
However, as shown in Figure 2.4, income from treasury operations is not high and fluctuates. Specifically, in the period 2011-2013, net income increased and increased most sharply in 2013, then in the period 2013-2015, there was a downward trend. This fluctuation is due to the fact that fees collected from treasury services are often very low and can even be waived to attract customers to use other services.
2.2.1.3. Guarantee and trade finance services:
BIDV Tien Giang, thanks to the advantages of the province and the favorable location of the Branch, has continuously focused on developing income from guarantee services and trade finance.
Chart 2.5. Net income from guarantee and trade finance services in the period 2011-2015
Unit: Million VND
14000
12000
10000
8000
6000
4000
2000
0
5193 5695
2742 3420
8889
3992
11604 12206
5143 5312
2011 2012 2013 2014 2015
Net income from guarantee services Net income from Trade Finance
(Source: Report on the implementation of the annual business plan of the General Planning Department of BIDV Tien Giang [24])
Through chart 2.5, we can see that BIDV Tien Giang's income from guarantee services and trade finance has grown over the years. The reason is: Among BIDV Tien Giang's corporate customers, the construction industry is the industry with the highest proportion of customers after the trading industry, this is a group of customers with potential to develop guarantee services. The second group of customers is corporate customers in the fields of agricultural production, livestock and seafood processing with high import and export turnover in the area.
are the target of trade finance development. In addition, BIDV Tien Giang also focuses on continuously developing these customer groups to increase revenue for many other products and services in the future.
2.2.1.4. Card and POS services:
As a service that BIDV Tien Giang has recently developed strongly, it can be said that this is a very potential market and has the ability to develop even more strongly in the future. Card services with outstanding advantages such as fast payment time, wide payment range, quite safe, effective and suitable for the integration trend and the Project to promote non-cash payments in Vietnam. Cards have become a modern and popular payment tool. BIDV Tien Giang early identified that developing card services is to expand the market to people in society, create capital mobilized from card-opened accounts, contribute to diversifying banking activities, enhance the image of the bank, bring the BIDV Tien Giang brand to people as quickly and easily as possible. BIDV Tien Giang is currently providing card types such as: credit cards (BIDV MasterCard Platinum, BIDV Visa Gold Precious, BIDV Visa Manchester United, BIDV Visa Classic), international debit cards (BIDV Ready Card, BIDV Manu Debit Card), domestic debit cards (BIDV Harmony Card, BIDV eTrans Card, BIDV Moving Card, BIDV-Lingo Co-branded Card, BIDV-Co.opmart Co-branded Card). These cards can be paid via POS/EDC or on the ATM system. In addition, with debit cards, customers can not only withdraw money via ATMs but also perform utilities such as mobile top-up, online payment, money transfer,... through electronic banking services.
In order to attract customers with card services, BIDV Tien Giang has continuously increased the installation of ATMs. As of December 31, 2015, BIDV Tien Giang has 23 ATMs combined with 7 ATMs in the same system of BIDV My Tho, so the number of ATMs is quite large, especially in the center of My Tho City, but is not yet fully present in the districts. Basic services on ATMs such as withdrawing money, checking balances, printing short statements,... BIDV ATMs accept cards from banks in the system.
Banknetvn and Smartlink, cards branded by international card organizations Union Pay (CUP), VISA, MasterCard and cards of banks in the Asian Payment Network. From here, cardholders can make bill payments for themselves or others at ATMs, by simply entering the subscriber number or customer code, booking code that service providers notify and make bill payments.
Chart 2.6. Net income from card services in the period 2011-2015
Unit: Million VND
3500
3000
2500
2000
1500
1000
500
0
687
1023
1547
2267
3104
2011 2012 2013 2014 2015
Net income from card services
(Source: Report on the implementation of the annual business plan of the General Planning Department of BIDV Tien Giang [24])
Through chart 2.6, it can be seen that BIDV Tien Giang's card service income is constantly growing because the Branch focuses on developing businesses operating in industrial parks, which are the source of customers for salary payment products, ATMs, BSMS. Specifically, there are companies such as Freeview, Quang Viet, Dai Thanh, which are businesses with a large number of card openings at the Branch, contributing to the increase in card service fees [25].
Table 2.6. Number of ATMs and POS machines in 2015 of some banks in Tien Giang area.
Unit: Machine
STT
Bank name
Number of ATMs
Cumulative number of ATM cards
POS machine
1
BIDV Tien Giang
23
97,095
22
2
BIDV My Tho
7
21,325
0
3
Agribank Tien Giang
29
115,743
77
4
Vietinbank Tien Giang
16
100,052
54
5
Dong A Tien Giang
26
97,536
11
6
Sacombank Tien Giang
24
88,513
27
7
Vietcombank Tien Giang
15
61,607
96
8
Vietinbank - Tay Tien Giang Branch
6
46,042
38
(Source: 2015 Banking Activity Data Report of the General and Internal Control Department of the Provincial State Bank [21])
Through table 2.6, the author finds that the number of ATMs of BIDV Tien Giang is not much, ranking fourth after Agribank Tien Giang, Dong A Tien Giang, Sacombank Tien Giang. The number of POS machines of BIDV Tien Giang is very small, only higher than Dong A Tien Giang and BIDV My Tho in the initial stages of merging the BIDV system. Besides, BIDV Tien Giang has a high number of cards increasing over the years (table 2.7) but the cumulative number of cards issued up to December 31, 2015 is still relatively low compared to Agribank, Vietcombank, Dong A (table 2.6).
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Compare Profit Ratio And Bad Debt Credit Xk -
Vietnamese law on loan contracts in the field of banking credit - 28 -
Net Interest Income Ratio From Tdtd In The Period 2015-2019 -
Guarantee in loan relationships at credit institutions - 1
Question 14.11
Update and properly implement the state's policies and guidelines on investment activities (Decentralization of investment appraisal and decision-making, investment incentives, investment encouragement, planning orientations, etc.) plan,…) | | | | | | |
Question 14.12 | Use appropriate economic and technical standards and indicators to evaluate project effectiveness (Discount rate applied to each type of project, standard payback period). standards, debt service coverage ratios, investment rates or cost rates for types of projects, project items, etc.) | | | | | |
Project appraisal process and method | ||||||
Question 14.13 | Analyze and evaluate the feasibility of the project in terms of technology, economy, society, environment... fully and objectively. authority to approve or disapprove the loan. | | | | | |
Question 14.14 | Have scientific, procedural and effective appraisal methods. | | | | | |
Question 14.15 | Simple and effective appraisal process, clear assignment of tasks and coordination between implementing units appraisal process | | | | | |
Question 14.16 | Time to carry out the appraisal process quickly, in accordance with regulations and commitments; Loan interest rate compete. | | | | | |
Staff at NHPT-Hue | ||||||
Question 14.17 | Competence, qualifications and experience of appraisal officers professional, well-trained | | | | | |
Question 14.18 | Professional ethics, good attitude of appraisal staff, polite, friendly towards customers row | | | | | |
Question 14.19 | Know how to skillfully combine practical experience and project appraisal regulations | | | | | |
Question 14.20 | Staff guide customers through all procedures, easy to understand | | | | | |
Question 15: According to you, what solutions are needed to improve the quality of appraisal work for State investment and development credit loan projects at the Vietnam Development Bank, Thua Thien Hue Branch: 1.................................................................................................................................
2...................................................................................................................................
3...................................................................................................................................
Question 16 : Your (Investor's) (if any) recommendation to the Vietnam Development Bank, TTH Branch to improve the quality of appraisal work for current State development investment credit loan projects: 1… …………………………………………………………………………………..
2… …………………………………………………………………………………………………………………..
3… …………………………………………………………………………………………………………….
-PERSONAL INFORMATION
1. Full name (may not be provided) :…………………………………................
2. Gender : Male Female
3. Age: Under 30 30 – 40 40 – 50 Over 50
4. Position held :
Regular staff Department heads Directors
5. Education level :
High school Intermediate, College, University Postgraduate
6. Experience : Under 3 years 3 – 5 years
5 – 7 years Over 7 years
Thank you very much for your help!