MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMY HCMC. Ho Chi Minh City
NGUYEN THI QUANG LIEN
Major: Finance - Banking Code: 60340201
MASTER THESIS OF ECONOMY
Scientific instructor: Dr. LE THANH LAN
City. Ho Chi Minh - Year 2012
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- Solution to complete international payment activities by documentary credit method at Joint Stock Commercial Bank for Foreign Trade of Vietnam, Vung Tau branch - 2
- Solution to complete international payment activities by documentary credit method at Joint Stock Commercial Bank for Foreign Trade of Vietnam, Vung Tau branch - 3
- Solution to complete international payment activities by documentary credit method at Joint Stock Commercial Bank for Foreign Trade of Vietnam, Vung Tau branch - 4
- Solution to complete international payment activities by documentary credit method at Joint Stock Commercial Bank for Foreign Trade of Vietnam, Vung Tau branch - 5
- Solution to complete international payment activities by documentary credit method at Joint Stock Commercial Bank for Foreign Trade of Vietnam, Vung Tau branch - 6
- Solution to complete international payment activities by documentary credit method at Joint Stock Commercial Bank for Foreign Trade of Vietnam, Vung Tau branch - 7
I hereby declare that this thesis is my own work and has not been published in any scientific works.
All information and figures quoted from reliable sources.
Nguyen Thi Quynh Lien
TABLE OF CONTENTS
TABLE OF CONTENTS i
LIST OF TABLES, DIAGRAMS
CHAPTER 1: THEORETICAL BASIS ON INTERNATIONAL PAYMENT AND Documentary CREDIT METHOD 1
1.1 The concept of international payment . first
1.2 Features of international payment 2
1.3 The role of international payments in the economy 3
1.3.1 For foreign trade 3
1.3.2 For banking and finance. 3
1.3.3 For social diplomacy. 4
1.4 Common methods of international communication today 5
1.4.1 Remittance method 5
1.4.2 Method of collecting 7
18.104.22.168 Thanks to 7 . smooth collector
22.214.171.124 By collecting documents. 8
1.4.3 Recording method (Open account) 10
1.4.4 Cash on delivery method. ten
1.4.5 Documentary Credits 11
1.5 Documentary Credit Method (TDCT) 11
1.5.1 Basis for the formation of TDCT 11
1.5.2 Concept, characteristics and role of 12 method of mathematical thinking
126.96.36.199 Concept of documentary credit method 12
188.8.131.52 Features of documentary credit method 12
184.108.40.206 The role of documentary credit method 13
1.5.3 Legal basis of documentary credit payment 14
1.5.4 Concept, content and classification of letters of credit 15
220.127.116.11 Concept of Letter of Credit 15
18.104.22.168 Contents of letter of credit. 15
22.214.171.124 Classification of letters of credit. 19
1.5.5 Operational process of documentary credit. 23
1.6 Advantages and disadvantages of documentary credit method 23
1.7 Lessons learned from Vietnam 23
Conclusion Chapter 1 25
CHAPTER 2: SITUATION OF INTERNATIONAL PAYMENT ACTIVITIES BY Documentary Credit Method at Joint Stock Commercial Bank for Foreign Trade of Vietnam - VUNG TAU BRANCH 26
2.1 Vietcombank overview 26
2.1.1 General introduction 26
2.1.2 The process of formation, development and achievements 27
2.2 About Vietcombank Vung Tau 28
2.2.1 The process of formation and development. 28
2.2.2 Operational network and organizational structure of Vietcombank Vung Tau 31
2.2.3 Operational situation. 33
126.96.36.199 Main activities of Vietcombank Vung Tau 33
188.8.131.52 Vietcombank Vung Tau's business results 34
2.3 The situation of international payment activities at Vietcombank Vung Tau 35
2.3.1 Export payment. 36
2.3.2 Import payment. 38
2.4 The situation of international payment activities by documentary credit method at Vietcombank Vung Tau 42
2.4.1 Import and export letter of credit business process at Vietcombank Vung Tau 42
184.108.40.206 Export letter of credit business process 42
220.127.116.11 Import letter of credit business process 42
2.4.2 Status of payment by documentary credit method at Vietcombank Vung Tau 43
18.104.22.168 Payment of export L/C. 43
22.214.171.124 Import L/C payment 46
2.4.3 Basic criteria to evaluate the effectiveness of L/C payment activities at Vietcombank Vung Tau. 49
2.4.4 Comparative correlation between Vietcombank Vung Tau and competitors in terms of payment by documentary credit method 52
126.96.36.199 Assessing the current situation of Vietcombank Vung Tau's competitiveness in the area 52
188.8.131.52 Limitations. 57
184.108.40.206 Causes of existence. sixty one
Conclusion Chapter 2 63
CHAPTER 3: SOLUTIONS TO COMPLETE INTERNATIONAL PAYMENT ACTIVITIES BY Documentary Credit Method at VIETNAM BANK FOR FOREIGN TRADE - VUNG TAU BRANCH. sixty four
3.1 Development orientation of international payment activities of Joint Stock Commercial Bank for Foreign Trade of Vietnam - Vung Tau Branch (Vietcombank Vung Tau). sixty four
3.1.1 Strategic orientation of Vietcombank. sixty four
3.1.2 Development orientation of Vietcombank Vung Tau until 2015 65
3.1.3 Orientation to develop international payment activities of Vietcombank Vung Tau in the coming time. sixty seven
3.2 Solutions to complete international payment activities by documentary credit method at Vietcombank Vung Tau 68
3.2.1 Solutions at Vietcombank Head Office 68
3.2.2 Solution team at Vietcombank Vung Tau 68
220.127.116.11 Promoting the advantages of Vietcombank Vung Tau branch based on the existing foundation and prospects of cooperation with Mizuho Corporate Bank Ltd 68
18.104.22.168 Improving the quality of international payments at Vietcombank Vung Tau 71
22.214.171.124 Arrange personnel and improve professional qualifications of international payment staff 72
126.96.36.199 Strengthening customer support consulting 72
188.8.131.52 Develop reasonable import and export payment plan targets. 74
184.108.40.206 Improve the efficiency of centralized payment form. 74
220.127.116.11 Promote effective exploitation of foreign currency sources 76
3.2.3 Recommendations to the State Bank of Vietnam 76
3.2.4 Solution on the customer side. 77
Conclusion Chapter 3 78
1. Operation process of documentary credit method.
2. Advantages and disadvantages of documentary credit.
LIST OF ACRONYMS. VIETNAMESE:
- NH: Bank
- State Bank: State Bank.
- Joint Stock Commercial Bank: Joint Stock Commercial Bank
- NK: Imported
- PGD: Transaction Office
- Credit card: Documentary credit
- Limited: Limited Liability
- International payment: International payment
- Vietcombank: Joint Stock Commercial Bank for Foreign Trade of Vietnam (VCB)
- Vietcombank Vung Tau : Joint Stock Commercial Bank for Foreign Trade of Vietnam –
Vung Tau branch.
- Export: Export
- Import- Export: Import-Export
- INCOTERMS (International Commercial Terms): International commercial terms
- ISPB (International Standard Banking Practice): Practice banking according to international standards on checking documents according to L/C
- L/C (Letter of Credit): Letter of Credit.
- SWIFT (Society for Worldwide Interbank Financial Telecommunication): Banking network system
- TF (Trade Finance): Trade Finance
- T/T (telegraphic transfer): Transfer money by electricity
- UCP (Uniform Customs And Practice For Documentary Credits): Uniform Rules and Practice for Documentary Credits.
- WTO: World Trade Organization.
LIST OF TABLES, DIAGRAMS. A. TABLE:
Table 2.1: Business results of Vietcombank Vung Tau in the period of 2009-2011 34
Table 2.2: Sales of export and import payments at Vietcombank Vung Tau in 2009-2011: 36 Table 2.3: Sales of export payments by payment method at Vietcombank Vung Tau in 2009-2011 36
Table 2.4: Export payment data at Vietcombank Vung Tau in 2009-2011 by commodity group 38
Table 2.5: Sales of import payments by payment method at Vietcombank Vung Tau in 2009-2011 38
Table 2.6: Import payment data at Vietcombank Vung Tau in 2009- 2011 by commodity group 40
Table 2.7: Market share of import and export payment of Vietcombank Vung Tau in Ba Ria - Vung Tau province in 2009-2011 41
Table 2.8: Export L/C data of Vietcombank Vung Tau in 2009-2011 44
Table 2.9: Sales and export L/C market share of commercial banks in Ba Ria - Vung Tau province in 2009 - 2011 45
Table 2.10: Vietcombank Vung Tau's L/C payment volume in 2009- 2011 46
Table 2.11: Sales and market share of import L/C payments of commercial banks in Ba Ria - Vung Tau province in 2009 - 2011. 47
Table 2.12: Income from L/C payment activities of Vietcombank and other commercial banks in the province in 2009-2011 50
Table 2.13: Proportion of income from L/C payment in total profit of Vietcombank Vung Tau in 2009-2011. 51
Figure 2.1: Vietcombank shareholder structure 27
Figure 2.2: Sales of export payments by payment method at Vietcombank Vung Tau in 2009-2011 37
Figure 2.3: Sales of import payments by payment method at Vietcombank Vung Tau in 2009-2011 39
Figure 1.1: Payment process for money transfer 6
Diagram 1.2: 7 . smooth collection process
Figure 1.3: Business process for collection with documents 9
Figure 1.4: Confirmed irrevocable letter of credit 20
Figure 1.5: Documentary credit payment process (See Appendix)
Figure 2.1: Organizational model of Vietcombank Vung Tau 32
1. Reason for choosing the topic.
During the doi moi period, the Party and Government were determined to integrate to industrialization - modernize the country and develop the economy according to the general trend of the world. This is confirmed in the Resolutions of the Party Congress, the Central Resolution, the Government's action programs... And this determination has been realized by the fact that, on November 7, 2006 Vietnam was officially joined the World Trade Organization (WTO) after a long time of tough and drastic negotiations. Since then, our country has officially joined the world's largest trade organization with many opportunities and challenges.
This creates an equal position with other countries in the organization, enjoying the benefits of a member of the organization as well as not being discriminated against in commercial disputes. International economic integration also helps domestic enterprises to expand export markets of goods and services, and to expand trade relations with all continents in the world.
Ba Ria Vung Tau province with its strength in oil and gas exploration and exploitation in addition to tourism potentials, seaports and farming, fishing, etc., the whole province currently has thousands of businesses operating, in which business Foreign-invested enterprises engaged in production and business in all fields attract billions of dollars of foreign investment. Every year, the province's import-export turnover increases significantly, mainly from spearhead enterprises of the province. More than 40 bank branches are present in the area, including state-owned commercial banks and joint stock commercial banks, providing a full range of banking services such as deposit mobilization, lending, guarantee, payment.
domestic and international payment... Especially, international payment activities in recent years have grown quite rapidly due to the development of transactions with foreign enterprises. To make the payment secure, businesses often use the payment method by letter of credit.
In the context that the world economy and Vietnam have many fluctuations along with fierce competition between banks, the issue of providing the best international payment service to attract customers to use it to bring benefits to the world economy. Profit for both the customer and the bank is the core. It is really necessary and urgent to come up with a solution to complete the payment method by documentary credit at Joint Stock Commercial Bank for Foreign Trade of Vietnam - Vung Tau Branch (Vietcombank Vung Tau). The thesis wishes to make useful suggestions to contribute to the improvement of international payment activities in terms of quantity and value, and to increase service revenue for the Branch and the system.
2. Define research problem.
Vietcombank Vung Tau was established in 1982, still quite young compared to other state-owned commercial banks in the area. Although the field of international payment is the strength of Vietcombank Vung Tau, there are still limitations in terms of professionalism, as well as the ability to advise and support customers in international payment activities. Besides, the customer's level is still weak in negotiating and signing foreign trade contracts. How to solve the above requirements to develop international payment by documentary credit in both quantity and quality, bring high service revenue and avoid risks for the branch.
The research of the topic is to provide solutions to improve international payment activities by documentary credit method at Vietcombank Vung Tau.
3. Research objectives:
Studying the theoretical basis and the actual situation of international payment by documentary credit method, thereby proposing some solutions and recommendations to improve and improve the efficiency of this operation at Vietcombank Vung Tau.
4. Research object and scope:
Research object: actual situation of international payment by documentary credit method of Vietcombank Vung Tau.
Research scope: the current situation of international payment activities by documentary credit method of Vietcombank Vung Tau in the period of 2009 - 2011. From that, draw the results, limitations, causes of existence and propose solutions solutions and recommendations to improve and improve the efficiency of this operation at Vietcombank Vung Tau.
5. Research Methods
The thesis uses the research method of secondary data and statistical method on the basis of data from 2009 - 2011 of Vietcombank Vung Tau (collected from the Department of International Payment, Department of Capital and Foreign Currency Trading). , statistics, reports of the State Bank - Ba Ria Vung Tau province branch, thereby synthesizing, analyzing, evaluating and comparing with other commercial banks in the area, and at the same time use the knowledge learned and documents on international payment to bring the problem from the theoretical basis to the actual operation, and draw out possible solutions, suitable to the current situation of the payment system. branch.
6. Scientific and practical significance of the topic
The thesis is researched on the basis of the actual status of international payment activities by documentary credit at Vietcombank Vung Tau, with comparison and assessment with other commercial banks in the area. The thesis goes from systematizing the basic concepts of international payment and documentary credit payment method, its importance in economic activities.
Currently, to the analysis of this actual situation of Vietcombank Vung Tau's operations, from that, the achieved results, shortcomings, difficulties and causes of those shortcomings are outlined.
On the basis of the researched theory, along with the practical experiences of myself and my colleagues in the process of working, give solutions and proposals suitable to reality while ensuring compliance with international practices. regulations and laws.
In addition, the proposal applies not only to Vietcombank Vung Tau but also to other branches in order to improve work efficiency and minimize possible risks in payment operations. international payments by letter of credit.
7. Dissertation layout
In addition to the introduction, the list of acronyms, the list of tables, graphs, conclusions and references, the thesis is organized into 3 chapters:
+ Chapter 1: Theoretical basis of international payment and documentary credit method.
+ Chapter 2: Actual situation of international payment activities by documentary credit method at Joint Stock Commercial Bank for Foreign Trade of Vietnam – Vung Tau Branch
+ Chapter 3: Solutions to complete and improve the efficiency of international payment activities by documentary credit method at Joint Stock Commercial Bank for Foreign Trade of Vietnam - Vung Tau Branch.
CHAPTER 1: THEORETICAL BASIS ON INTERNATIONAL PAYMENT AND Documentary CREDIT METHOD.
1.1 The concept of international payment
Currently, every country in the world must strengthen cooperation for coexistence and development. The cooperation is reflected in many fields of economy, politics, diplomacy, culture, science and technology, tourism... on the basis of economic cooperation. The process of buying and selling goods and services leads to the need for payment and payment between buyers and sellers in countries through banks.
The economic, political, cultural and social relations between countries are increasingly developing, forming the monetary flows between countries, creating the financial position of each country.
In transactions between countries, due to differences in languages, customs, geographical distances, payment cannot be made directly, but must go through an intermediary organization, which is a commercial bank with an active network. around the world.
With the development of modern communication technology today, any receipt or payment, payment, money transfer, capital and profit transfer from one country to another, between import and export businessmen, investors, financial institutions, banks, governments, ... are easy, fast, convenient and effective.
The use of money to express international relations in many different ways has become an indispensable requirement, and at the same time, people use money to perform and complete international trade. economy, making them simple and convenient.
Payments between countries are made via bank transfer and only cash is used in special cases. Therefore, international payments about
essentially, are international banking operations, formed and developed on the basis of foreign trade contracts and international currency exchanges.
International payments are made on the basis of international trade laws and practices, and are also governed by the laws, economic, foreign trade and foreign exchange policies of the participating countries.
Therefore, international payment is the performance of a monetary obligation arising from the purchase and sale of goods or services between an individual or organization of one country and an individual or organization of another country, or between a with a certain international organization through the banking system.
International trade payment for the movement of goods and services between countries, including payment for import and export of goods, services, transportation, post and telecommunications, finance and banking...
Non-commercial international payments are not related to goods and services, but contribute to the realization of relationships between countries, including personal, diplomatic, social, scientific and technical cooperation art,...
1.2 Characteristics of international payments.
International payments in terms of a developed financial and monetary system have the following characteristics:
First, international payments are made mainly by wire transfer or clearing through domestic and international banking systems, allowing quick, safe and accurate settlement. Transfer payment is associated with the banking system and the link between the banking system of countries and international financial institutions. The participation in information networking and the application of high technology in information processing helps the bank keep up with the development of the world, not being outdated and inferior to other countries, creating favorable conditions for domestic banks to expand. relations with foreign countries, improve prestige in the international arena as well as with domestic and foreign customers, exploit the