Overview of Socio-Economic Situation in Ho Chi Minh City

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First, build and perfect a complete legal framework.

and synchronization: Build

Build and complete a complete and synchronous legal framework between laws and implementing documents according to the experience of other countries regarding credit granting forms. Focus on clearly defining credit granting forms, types and methods. Issue detailed regulations guiding credit granting forms, creating favorable conditions for commercial banks to easily implement and customers to conveniently access a variety of credit granting forms, types and methods. Detailed regulations on credit granting for various sectors for commercial banks to apply, including consumer credit (based on Malaysia's experience), residential housing credit (Singapore), car purchase credit (China, Singapore), credit for student education needs (China), agricultural credit (China, Thailand, Malaysia), real estate business credit (Singapore, Malaysia), real estate bridging credit (Singapore), credit for serving SMEs (China, Malaysia).

Second, promulgate regulations guiding the implementation of credit granting forms in a synchronous and timely manner and in accordance with current laws: Laws in all countries have detailed instructions for credit granting forms; some countries have also established separate laws for some forms of credit granting, to manage and regulate credit activities more closely. Specifically, the Consumer Credit Law and the Guarantee Law in China, as well as detailed regulations on factoring in Thailand, etc. In Vietnam, many legal regulations for each form of credit granting issued under the Law on Credit Institutions in 1997 are not consistent with the Law on Credit Institutions in 2010. It is necessary to develop and promulgate new regulations to replace, guide and facilitate commercial banks to diversify credit activities.

Third, develop a credit growth plan to ensure feasibility: Develop and implement a credit growth plan, adjust the credit structure based on the industry or scale of customers and the scale of credit activities to ensure the feasibility of the plan. Regularly instruct commercial banks to optimize the credit structure, control credit grants in diverse forms, increase credit grants to rural areas and small and medium enterprises according to China's experience. Forms of credit grants need to be expanded to the entire economy, serving areas with development potential as stated in the socio-economic development strategy in each period according to Malaysia's experience. In Vietnam, for many years, the work of developing and implementing credit growth plans of commercial banks every year has the same general target, leading to credit growth exceeding the control level of some commercial banks. The credit structure of some commercial banks is unbalanced, focusing on granting credit to only a few areas, including high-risk areas such as real estate business and securities investment. Therefore, the development and implementation of annual credit growth plans for commercial banks must be based on the industry or scale of customers, credit scale to ensure credit growth according to a structure suitable to the structure of industries and economic sectors; in addition, it is necessary to consider factors such as financial capacity, capital mobilization capacity, governance capacity, risk management, etc.

Fourth, inspect, supervise and monitor the credit activities of commercial banks according to international practices and standards: Paying attention to ensuring the soundness of credit activities of commercial banks, some countries have built their own laws to regulate the inspection, supervision and monitoring of the diversification of credit activities such as the Law on Banking Management and Supervision of China in 2003. In addition, many countries have issued documents guiding commercial banks to control credit activity risks based on international practices and standards; guiding risk management and control for each form of credit granting such as in Singapore.

The inspection, supervision and monitoring of credit activities of commercial banks in Vietnam mainly focuses on compliance, focusing on detecting violations. The scope of banking inspection and supervision is not comprehensive, so the nature and level of potential risks in credit activities and each form of credit granting of commercial banks have not been correctly determined. Therefore, it is necessary to effectively inspect, supervise and monitor commercial banks, in accordance with international practices and standards as experienced by many countries, in order to maintain public trust in the banking system, through publicity, transparency and contributing to limiting risks in the process of diversifying credit activities.

Fifth, implement a number of State support and promotion activities for the diversification of credit activities: Diversify credit activities along with reforms in the banking sector, promote the completion of legal regulations on credit granting forms, build a roadmap for opening up banking activities in general and credit activities in particular as in the cases of China, Thailand, Malaysia. Vietnam is implementing the roadmap for banking reform and implementation. The project to restructure the system of credit institutions in the period of 2011-2015 is to prioritize credit capital for production, serving the development of agriculture, rural areas, exports, supporting industries, manufacturing-processing, SMEs; diversify banking services, focus on improving the quality of traditional banking services and rapidly developing modern banking services. These are important orientations for diversifying credit activities, contributing to providing diverse forms, types and methods of high-quality credit, creating convenience for the economy.

The State facilitates the development of diverse credit information activities to serve the need for diversifying credit activities. Credit information provision activities are focused on development by many countries. International experience in Malaysia, forming a complete legal framework, providing diverse credit information, facilitating the development of diverse credit activities. The State supports the process of diversifying credit activities by focusing on training, educating financial management skills, providing information to people and businesses. These activities are of great significance to the State management of diversifying credit activities. According to the experience from Malaysia, the State is interested in guiding financial management skills for people and businesses, most effectively using credit capital, providing information, support, and advice to people to access more easily bank credit capital with diverse forms, types and methods of credit granting. Thereby contributing to diversifying credit activities and improving the effectiveness and efficiency of State management in diversifying credit activities.

CHAPTER 1 SUMMARY

Diversifying credit activities includes lending, discounting CCCN and other valuable papers, bank guarantees, issuing credit cards and factoring. Diversifying credit activities plays an important role in providing diversified credit capital for socio-economic development, contributing to increasing income, dispersing risks for commercial banks and promoting the development of the financial-banking-credit services market.

Chapter 1 has systematized the basic theoretical contents of credit diversification. Determining in detail the forms of credit granting, types and methods of credit granting. Applying the Ansoff matrix to choose the direction and type of credit diversification and applying some criteria according to the CAMELS criteria, the author provides evaluation criteria to analyze the level of credit diversification.

Theoretical bases related to State management on credit activity diversification are systematically formed in this Chapter 1, clearly stating some viewpoints of schools and clearly defining the concept of State management on credit activity diversification. Specifically defining the objectives, functions of State management and contents of State management on credit activity diversification. From the objectives, functions and contents of State management as a basis for the author to determine the criteria for evaluating the results of State management on credit activity diversification and clearly stating the factors affecting the results of State management on credit activity diversification as a basis for analysis and evaluation in Chapter 2. At the same time, presenting international experience and lessons learned from State management on credit activity diversification so that they can be appropriately applied to specific conditions in the process of State management on credit activity diversification of commercial banks in Ho Chi Minh City.

CHAPTER 2

STATUS OF STATE MANAGEMENT ON DIVERSIFICATION OF CREDIT ACTIVITIES OF JOINT STOCK BANKS IN HO CHI MINH CITY IN THE PERIOD 2006-2012

2.1 Overview of commercial banks in Ho Chi Minh City

2.1.1 Overview of the socio-economic situation in Ho Chi Minh City

Overview

economy

Vietnam in the period 2006-2012 by number

whether

Statistics show that the GDP growth rate decreased from 8.23% in 2006 to 5.03% in 2012, the growth rate at the end of this period was lower but in the context of the world economy facing difficulties, the whole country focused on implementing the priority goal of controlling inflation and stabilizing the macro economy. The average economic growth was 6.57% in the period 2006-2012, the average growth of the three economic sectors of agriculture, forestry and fishery increased by 3.35%, industry and construction increased by 7.12%, services increased by 7.43%. (see Table 2.1) People's income and living standards were gradually improved, GDP per capita increased from 730 USD in 2006 to 1,168 USD in 2010 [94, p.1] and to 1,540 USD in 2012 [69, p.1]; The poverty rate in the period 2005-2010 decreased from 22% to 9.45% and in the period 2011-2012 decreased from 14.2% to 10% [92, pp.1-2].

Table 2.1. Vietnam's GDP growth by sector in the period 2006-2012

Branch

2006	2007	2008	2009	2010	2011	2012
Growth rate (%)
GDP at constant 1994 prices	8.23	8.48	6.29	5.32	6.78	5.89	5.03
Agriculture - forestry - fishery	3.69	3.40	5.04	1.82	2.78	4.0	2.72
Industry - construction	10.38	10.60	5.61	5.52	7.70	5.53	4.52
Service	8.29	8.68	7.54	6.63	7.52	6.99	6.42
Contribution to GDP growth in %
GDP at constant 1994 prices	8.23	8.48	6.23	5.32	6.78	5.89	5.03
Agriculture - forestry - fishery	0.72	0.64	0.68	0.32	0.47	0.66	0.44
Industry - construction	4.17	4.34	2.95	2.29	3.20	2.32	1.89
Service	3.34	3.50	2.90	2.71	3.11	2.91	2.7
Contribution to GDP growth as a percentage
GDP at current prices	100	100	100	100	100	100	100
Agriculture - forestry - fishery	8.77	7.52	14.31	6.05	6.99	11.2	21.65
Industry - construction	50.68	51.22	37.29	43.07	47.19	39.4	40.65

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