A1 BS Chii Group_F02D-Final

8/3/2019 A1 BS Chii Group_F02D-Final

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BANKING ACADEMY, HANOIBTEC HND IN BUSINESS (FINANCE)

ASSIGNMENT COVER SHEETNAME OF STUDENT Chii Group_F02D

REGISTRATION NO.Phan Thi Thuy Dung Celia F02 037Nguyen Hong Nhung Chibi F02 135Tran Thu Trang Maria F02 185

UNIT TITLE Unit 7: Business StrategyASSIGNMENT TITLE Group AssignmentASSIGNMENT NO 1 of 2NAME OF ASSESSOR Vincent Ng

SUBMISSION DEADLINE 23 November 2010

I, _______Chii Group_______ hereby confirm that this assignment is my own work and not copied or plagiarized from any source. I have referenced the sources from which information is obtained by mefor this assignment.

Phan Thi Thuy Dung_CeliaNguyen Hong Nhung_ChibiTran Thu Trang_Maria

________________________________ ______23/11/2010__

Signature Date

---------------------------------------------------------------------------------------------------------------FOR OFFICIAL USE (Course Administrator)

Assignment Received By: Date:

Chii Group_F02D Page 1


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Unit Outcomes

OutcomeEvidence for

thecriteria

Feedback AssessorsdecisionInternal

Verification

Analyze howthe businessenvironment

isconsideredin strategy

formulation.

(1)

Define thecontext of businessstrategy

a

Explain thesignificance of stakeholder

analysis

b

Conduct anenvironmentalandorganizationalaudit of a givenorganization

c

Apply strategic

positioningtechniques tothe analysis of agivenorganization

d

Understandthe processof strategic

planning.

(2)

Demonstrate anability to thinkstrategically

a

Merit grades awarded M1 M2 M3

Distinction grades awarded D1 D2 D3



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OutcomeEvidence for

thecriteria

Feedback AssessorsdecisionInternal

Verification

Comments by Assessor - Common Skills

A B C D E F G

Assignment( ) Well-structured; Reference is done properly / should be done (if any)

Overall, youve

Areas for improvement:

ASSESSOR SIGNATURE DATE / /

NAME: .........................................................................................(Oral feedback was also provided)

STUDENT SIGNATURE DATE / /

NAME : ........................................................................................

FOR INTERNAL USE ONLYVERIFIED YES NO

DATE : ........................ ......................... ...... ...... ...... ...... .

VERIFIED BY : .......................... ........................... ..................... .

NAME : .......................... ........................... ..................... .

COMMON SKILLS & COMPETENCIES ASSESSED (indicated by X)Report about development strategic plan in Vietnam market of


A. MANAGING & DEVELOPING SELF D. MANAGING TASKS & SOLVING1. Managing own roles & responsibilities 12. Use information sources X2. Manage own time in achieving objectives 13. Deal with a combination of routine & non-

3. Undertakes personal and career development 14. Identify & solve routine & non-routine4. Transfer skills gained to new/changing

B. WORKING WITH & RELATING TO OTHERS E. APPLYING NUMERACY5. Treat others beliefs and opinions with respect 15. Applying numerical skills and techniques6. Relate & interact effectively with individuals &

7. Work effectively as a team member F. APPLYING TECHNOLOGYC. COMMUNICATING 16. Use a range of technological equipment X8. Receive and respond to a variety of X G. APPLYING DESIGN AND CREATIVITY9. Present information in a variety of visual X 17. Applying a range of skills and techniques to

develop a variety of ideas in the creation of 10. Communicate in writing X

11. Participate in oral & no-verbal communication 18. Use a range of thought processes


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Vietcombank

Prepared for:

Mr. Vincent (Lecturer) and Mr. Tran (Tutor)

Banking Academy, Hanoi, Vietnam

BTEC HND in Business (Finance)

Unit 7: Business Strategy

Prepared by:

Chii Group_F02D

Student name: Phan Thi Thuy Dung_Celia_F02 037

Nguyen Hong Nhung_Chibi_F02 135

Tran Thu Trang_Maria_F02 185

23 November, 2010.



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Table of ContentsPage

I. Assignment coversheet.1-5II. Executive summary..6III. Introduction

The context of Vietcombank business strategy....7IV. Main Body.

A. The key stakeholders of the company in Vietnam and the significance of conducting13B. Conduct an external environment and organizational audit of the companyStructure and Culture..16

SWOT analysis..............20Competitor..33D. The strategic position of Vietcombank in Vietnam.TOWS matrix..37

V. Conclusion.43VI. References.44



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Executive summary

The purpose of this report is to identify and assess clearly the strengths as well as weaknessesof Vietcombank after a long time developing. Vietcombank is evaluated as a trust and powerful brand in banking field and has strong financial situation and business performance.It always has effective management with good services and a wide network in Vietnam.However, it has the weaknesses are debit balance focuses on state-owned enterprises andretail in banking array develops slowly, bad debts have high proportion. Besides, explainingthe significance of conducting a stakeholder analysis and conduct an external environment

and organizational audit. In comparison with Vietinbank, one of the main competitors of Vietcombank, the strengths and weaknesses of Vietinbank are also listed. In the last part,Vietcombank uses TOWS Matrix to takes full advantage of strengths and opportunities andavoid the disadvantages of weakness and threats to have suitable and effective strategies.



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Introduction

The context of Vietcombank business strategy

Vietcombank was established on April 1st, 1963 as a State-owned Commercial Bank. It is theoldest commercial bank for external affairs in Vietnam. During 45 years of build and growth,Vietcombank has developed and grown up in strength following the multipurpose bank model. Beside the field of finance and banking, Vietcombank has also taken part incontributing money, associated with many domestic and foreign businesses in many businessfields such as: insurance, immovable, investment fund, etc. Now Vietcombank is the top-ranking bank of Vietnam with a strong competitive ability and the commitment to the

customers is very good.

With many remarkable successes, Vietcombank becomes the first commercial bank in Viet Nam to deal foreign currencies, always takes the largest market share in the interbank forexmarket. It is the leading commercial bank in trade finance, international payment, forexdealings, advanced Banking - IT implementation with over 100 domestic banks and foreign



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banks branches operating in Vietnam. Apart from normal lending activities, Vietcombank has been strengthening its activities through domestic and international interbank markets in a bid to improve capital usage efficiency contributing to increasing profits. In the past yearsVietcombank always strengthens its role as the most prestigious bank in fields of funding,export and import payment, forex dealing, guarantee and international financial and bankingservices, thus in the background of drastic competition the Bank still maintains its stable andlarge market share. Nowadays, Vietcombank is a full member of:o Vietnam Bankers Associationo Asia Bankers Associationo SWIFTo Visa, MasterCard.Although achieving many successes, Vietcombank always has to work under pressure because there are many banks have been just established in Vietnam. It means Vietcombank has more and more competitors. Besides, according to the report of BMI (Business Monitor International), to tighten monetary policy in 2010 will impact on Vietnamese Banks andsmall commercial banks in Vietnam might take a risk. However, BMI forecasted that bankingindustry of Vietnam will develop much more in the future because there will be participationof many foreign banks. This will make domestic banks work under pressure (Tra My, 2010).Banking system is the heart of the economy. During the previous years, the banking systemhas provided a great capital source for the economy, accounting for approximately 16% to18% of GDP annually and was almost equivalent to 50% of total investment capital of thewhole country. Vietnamese banking system has developed strongly, efficiently and played acrucial role as the connection between production, consumption, and savings (The StatedBank of Vietnam).



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At the moment, Vietnam has 5 State-owned banks (except Vietcombank), 39 joint stock commercial banks, 40 foreign banks s branches, 5 joint-venture banks, 5 foreign banks(100%), 17 finance companies, 13 leasing companies.



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SOCBs take the significant part of banking market (but the main customers are large andmedium enterprises), JSB have the ratio Capital/ Total assets much higher than SOCBs andhave the ratio outstanding balance / deposit higher than SOCBs (VIB accounts for 80-83%).

1. Vision and mission

According to Mintzberg (BPP Professional Education Business Environment course book,2004, p.27), mission describes the organizations basic function in society, in term of the products and services it produces for its clients. Being one of the oldest commercial banks inVietnam for external affairs, Vietcombank has known as the most prestigious bank in banking field. With the motto Always for customers success (Vietcombank, n.d),Vietcombanks dominant target is to uphold the role of a leading commercial bank inVietnam and to be an international one in the region.



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Over 45 years of build-up and growth, Vietcombank has developed according to the model of a multifunctional bank with main activities following: mobilize and receive short, mediumand long-term deposit funds from organizations and individuals; lending on a short, mediumand long-term basis up to the nature and ability of the Banks capital resources; conductingsettlement and cash services; and other banking services as approved by the SBV; conductinginvestments in associate, joint-ventures and other companies; investment in bonds and deal inforeign exchange in accordance with prevailing regulations (Vietcombank, 2008). Besides,Vietcombank supports services about insurance, financial and monetary consultant,investment consultant with function of a commercial bank (Vietcombank, n.d). Moreover, it plays an important role in assisting the State Bank of Vietnam to affect supply and demand of foreign currency in the market to stabilize monetary according to the States goal(Vietcombank, 2003). Generally, Vietcombank has undertook well the main roles of acommercial bank in providing banking products and services with high quality but at thesame time has connected business effects with implementing the States policies.

2. Objectives

Objectives 1: to increase the total assets by 15% in 2010 .

S-Specific: the number of total asset in 2010 increases 15% in comparison to last year.M-Measurable: 15%/year.A-Agreed: by managers of Vietcombank.R-Realistic: in 2009, the total assets of Vietcombank was 255,496 billion VND, increased

15% in comparison with 2008 15%/year are acceptable.T-Time bounded: Each year 15% more.Policy: accelerate corporate banking, speed up retail-banking segment to improve the bankscapital structure in order to diversify assets and liabilities portfolio for risks management

purpose.

Objective 2: to reach the income before taxes: 4,500 billion VND.

S-Specific: the number of income before tax in 2010 reaches 4,500 billion VND.M-Measurable: 4,500 billion VNDA-Agreed: by managers of Vietcombank.R-Realistic: in 2009, the income before taxes of Vietcombank was 3,473

billion VND 4,500 billion VND are acceptable.



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T-Time bounded: one year from 2009 to 2010.Policy: upgrade technology to meet increasing demand from customers as well as to serve business management and administration better, encourage international and public relations,enhance promotion of the Banks products, services and brand within the network and in themarket.

Objective 3: to increase total fund mobilization by 20%.

S-Specific: the number of total fund mobilization in 2010 increase by 20%.M-Measurable: 20%/year A-Agreed: by managers of Vietcombank.R-Realistic: total fund mobilization of Vietcombank for the year 2009 increased by 17.5%

against 2008 20%/year are acceptable.T-Time bounded: one year from 2009 to 2010.Policy: continue working with strategic partners, issue more stocks increase legal capital.



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Main Body

The key stakeholders of the company in Vietnamand the significance of conducting

Being a Joint Stock Commercial Bank, stakeholders influence strongly on Vietcombank. Asmany other banks Vietcombank has enough three board of stakeholders. They are internalstakeholders (management and employees), connected ones (Shareholders, customers,competitors, suppliers), and external ones (Central government, local authorities, professionalgroups, and pressure groups). Basing on stakeholders mapping, there are four levels toevaluate the impact of stakeholders. They are:1. Minimal effort (low interest, low influence segment, do not have great ability toinfluence strategy & do not have much interest in the organisation);2. Keep satisfied (low interest, high influence segment, must be treated with care,capable of being key players);3. Keep informed (high interest, low influence segment, do not have great ability toinfluence strategy but their views can be very important in influencing more powerfulstakeholders);4. Key players (high interest, high influence segment, strategy must be acceptable tothem). (BBP, 2004, pp.42)

Table: Stakeholder mapping of Vietcombank

Types Stakeholders Stakeholders mapping

Key Players

KeepSatisfied

Keep Informed

Minimal Effort

Internal

Stakeholders

Managers /Employees /

Connected

Stakeholders

Shareholders /Customers /Competitors /Suppliers /

External

Stakeholders

CentralGovernment

/



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Local Authorities /ProfessionalGroups

/

Pressure Groups /

For Vietcombank, the three main stakeholders considered as key players comprise of theBoard of Directors (managers) and Central Government the State.

As internal stakeholders, the board of director is considered key players

because they have high influence in business and making profit for the

bank by their direct participation into the operation and business decision-

making process. Vietcombank always specifies that it is human resource

which is a key factor in the Banks success (Vietcombank, 2003). They

create the image for the Bank through theirs excellent performance and

achievement. On March 15th 2005, at the meeting of Asian bankers in

Bangkok, Thailand, Dr. Vu Viet Ngoan, the CEO of Vietcombank, was

chosen to receive the Outstanding Asian Banker 2005 prize. According

to a representatives explanation from Asian Banker Magazine, under the

leadership of Dr. Vu Viet Ngoan, Vietcombank has succeeded in its

restructuring program and raising its financial capabilities through

convertible bond issuance. It has also been the most profitable of the

state commercial banks in Vietnam (Vietnamnet, 2005). After taking the

place of CEO from Dr. Vu Viet Ngoan, Mr. Nguyen Phuoc Thanh also has

had much contribution to build and develop Vietcombank. On October 13 th

2008, Mr. Nguyen Phuoc Thanh was awarded the prize of Outstanding

leaders in the retail sector in 2008 (Vietcombank, 2008). Additionally,

Vietcombank Chairman Mr. Nguyen Hoa Binh was awardedTop 10 Outstandingbusinessman in exterternal trade affairs the first time in 2009 by The Vietnam Union of friendship Organisation, Voice of Vietnam and Van Hien Magazine;Vietnam OutstandingBusinessman in 2009 awarded by Vietnam Chamber of Commerce and Industry (VCCI)(Vietcombank, 2009).In spite of having been privatized, Vietcombank is still under the main management of the

State (Central Government) because the State has held about 70% of Vietcombanks totalshares (Vietcombank, nd). As a result, the State is still the biggest shareholder of



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Vietcombank and holds authority and responsibility in operating Vietcombanks activities.Besides the influence of a shareholder, the State has impact on Vietcombank throughmacroeconomic policies. For example, one of typical macro policies which have beenadopted by the Government recently is Circular 13. The circular specify the rates on thesafety of the activities of credit organizations, which was officially promulgated on5/20/2010, replacing Decision 457 of the State Bank (SBV). The increase in CAR from 8% to9% has impact first to the commercial banks which do not currently achieve this ratio. In particular, the capital adequacy ratio of VCB is currently at 8.45%. Responding to this policy,VCB has plans to increase its capital to 17 trillion in 2010 (after a proposed capital increase,the Vietcombanks CAR will can reach 9.1%), this will cause Vietcombanks shares diluted.In addition, Vietcombank also announced about its divestments at the EIB and PVD as wellas a number of other organizations. Article 18 of this circular implies the ratio of bank creditwill be reduced to 65-70%. However, pressure from reduce lending rates which led toincreases in input costs cannot offset by increasing output rates. With proportion about 80%of Vietcombanks revenue now from the array of credit, even if there are some positivesignals from Circular 19, the impact from Circular 13 will significantly reduce the rate of profit margins, leading to reduce the attractiveness of bank shares (atpvietnam, 2010).Clearly, it can be said that Vietcombanks activities as well as business effectiveness andefficiency have been influenced directly and significantly from the Governments macro policies.



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Conduct an external environment and organizational

audit of the company

Structure and culture1. Structure

Every organization should have a good structure because Good organizational structure leadsto efficiency, and less conflicts. The organization structure provides for consistent functionsand roles, irrespective of changes in individual membership. (BPP Professional Organisationand behavior course book, 2004, p.6). Vietcombank might havecentralization in itsorganization, following business line. Managers made the decisions, and employees obey themanagers, doing what managers ask. Along withcentralization structure might be thenarrow span of control as well as atall structure in Vietcombank. Having alarge numberof levels of management hierarchy, Vietcombank cannarrow control spans and alargenumber of steps on the promotional ladders assists management training. Besides,smallgroups enable team members to participate in decisions. However, for this reason, theinitiatives of employees can be blocked, and the same work has to pass through too manyhands. Other disadvantages of tall organization are: inhibit delegation and increaseadministration and overhead costs, communication problems, as decisions take time to filter down. (BPP Professional Organisation and behavior course book, 2004, p.64). More thanthat, centralization has some main advantages such as: decisions are made at one point andso are easier to co-ordinate, senior managers in an organization can take a wider view of problem and consequences, and quality of decisions is higher due to senior managers skillsand experience. (BPP Professional Organisation and behavior course book, 2004, p.66).



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Organizational structure of Vietcombank



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2. Culture

Organisational culture is the intangible assets of each business. Along with the developmentof market economy, the construction of organizational culture is an essential job but quite

difficult. Apart from subjective factors, to build organizational culture must also focus on theobjective factors. They are the set up market, the benefit of consumers expressed through the principle to protect consumers, and the process of integration into the regional andinternational economy.

A foreign bank participating in the Vietnam market has taken the motto "well-informed aboutlocal culture" to penetrate and build its corporate image, to compete with domestic banks.This can be seen as organizational culture is an important factor in making business policyand strategic vision which businesses in general and banks in particular should consider building.

At the moment, the operation of banks is competing fiercely. Therefore, to attract customers, beside the improvement of the quality of products and services, an important solution in thecompetitive problem is the use of manual business culture, including transaction style of bank staffs. Vietcombank was evaluated that the attitude and serving style of staffs is very good.At a transaction room of Vietcombank on Hang Trong Street (Hanoi), customers can feel therespected attitude and the friendliness of every staff. On this street, there are many transactionrooms of other banks, but the number of guests come to this room is always crowded.

Established in 1963, Vietcombank now is a State Bank of Vietnam. At this time, the State of Vietnam owns nearly 1,098 billion of the shares of Vietcombank, equal 90.72% (Vietchina business, 2010). Therefore, culture of Vietcombank has been controlled by the State and itsoperation could not be active like many other commercial banks. However, the trend of

Vietcombank is more and more active, not like Agribank. Vietcombank is not active just atsome towns which the business effect is weak.



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SWOT analysis of Vietcombank

Strengths:

S1: Vietcombank is a trust and powerful brand in banking field.


Strengths A trust and powerful brand in banking

field. Strong financial situation and

business performance. Effective management with good

services.

A wide network in Vietnam. Products and services are diversified.

Weaknesses Debit balance focuses on state-owned

enterprises and retail in banking arraydevelops slowly.

Bad debts have high proportion. Small and medium sized customers

and individual customers are difficult

to approach Vietcombank.

Opportunities

The economy is recovering after thecrisis, many businesses need capital,and this is a great opportunity for development of commercial banks.

Vietnam's banking sector has huge potential to grow.

International integration (joining inWTO) offers many opportunities for Vietcombank.

Threats

Competition in banking sphere isincreasing remarkably, so that marketshare for mobilization and lendingcapital is decreasing.

Deeper integration of bankingindustry brings more challenges for Vietcombank.

Macro factors such as economic, political and management policy havesignificant impact on bankingindustry.

Credit activities are not reallyeffective.


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According to Vietcombank.com.vn, Vietcombank operated more than 45 years (1/4/1963). Itis established while Vietnamese credit system was in the newly formed. Foreign currencytrading and import-export payments is an outstanding area of bank beside the development of many other services such as banking cards, credit, investment etc.

The Bank for Foreign Trade of Vietnam (Vietcombank) is the unique representative of Vietnam which has been awarded six prizes related to foreign currency business and moneymanaging. These prizes include: the best domestic Provider of FX Services 2009, the besttrader on foreign currencies in the 2006-2008 period, the best cash management 2009, the best bank for its creative ideas in foreign currency services, the best intermediary in the tradeof foreign currencies, and the bank owning the best online trading background

(vietnaminvestment.net). Moreover, in 2008, Vietcombank was selected as the bestVietnamese domestic bank, best foreign exchange service provider and best trade paymentsservice provider by the AsiaMoney and the Trade Finance magazines. Asiamoney wasestablished in 1989 and is a member of Euromoney Group who responsible for writingarticles about the finance and banking market in Asia region.

Following to qdnd.vn, Vietcombank was awarded the prizes for the best provider of foreigncurrency services, the best trader on foreign currencies in the 2006-2008 periods, and the best

cash management. As one of the largest and the most prestigious banks in Vietnam,Vietcombank now occupies a large market share, holding 10 percent of loans, 12 percent of deposits, 23 percent of international payments and 55 percent of card payments. Besides,Vietcombank was also ranked as the best bank for its creative ideas in foreign currencyservices, the best intermediator in the trade of foreign currencies and the bank owning the best online trading background.

Viecombank also plays the role as the Foreign Exchange Department of the Central Bank (now State Bank) to advise the Committee of the State Bank on foreign exchangemanagement policy, gold, silver, foreign currency management fund; foreign currencytrading of Vietcombank is the most powerful and longest in Vietnam (from 1962 to present).So that, VCB is a great brand and has reputation in Vietnamese banking field.

S2: Vietcombank has strong financial situation and business performance.

S2.1: Strong financial situation



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Vietcombank has larger assets and capital scale in the commercial banking system after Agribank and BIDV. Charter capital of the Vietcombank after equitization of 15,000 billionVND, in which the state accounts for 70% and 30% for other shareholders to meet theminimum capital adequacy ratio of 8% according to international standards(vietcombank.com.vn). Furthermore, in 2010, Vietcombank will continue selling shares toincrease its chartered capital while maintaining the States ownership in the Banks charteredcapital of no less than 51%.

Following to Fitch Rating, Vietcombank continues to benefit from a relatively low proportionof loans compared with its total assets (61% at end2009) and therefore its LDR wasmoderate at 87%. However, it had climbed 15 percentage points since end2008, the highest

increase in the Fitchrated sample.

Besides, levels of reserves to gross loans vary widely, from a very low 0.8% at ACB and0.7% at Sacombank to a more reasonable but still limited 3.4% at Vietcombank at end2009.This suggests that Vietcombank is trying to stabilize the financial situation in the strongdevelopment of the banking industry today.



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Besides, about profitability, ROA and ROE of Vietcombank over the years are higher thanother banks, often reaching 20%, higher than the average of the 10 banks which have thehighest ROE was 17.4% and higher than industry average (8:57%). Specially, in 2008, ROEof VCB is 18.43% that is higher than industry average is 12.50%, ROA reached 1.21% atapproximately 1.24% of the industry (vietcombank.com.vn). The growth in profitability of VCB shows the stable and balanced finance of VCB over the years.



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Source: TVSI

S2.2: Business performance

In 2009, consolidated total assets as at 31/12/2009 were VND 255,496 billion, up 15.04%compared to 31/12/2008, and 3.7% higher than business plan. Total assets of the bank itself as at 31/12/2009 reached VND 255,067 billion, increasing 15.6% compared to that of 31/12/2008. Also, loans portfolio grew by 25.56%, customer deposits increased by 5.92%;loan quality was improved considerably with NPLs ratio of 2.47%; consolidated income before tax was 5,004 billion VND, increased by 39.39% compared to 2008, leading to a highROE of 25.58% (vietcombank.com.vn). Some other ratios, such as profit before tax in 2009reached VND 5,004 billion, up 39.4% compared to that of 2008, which was 50.7% above thetarget; profit after tax totalling VND 3,944.8 billion; net profit (excluding minority interest)reached VND 3,921 billion, claim the stability and growth of assets and capital of Vietcombank. As a result, this effective business performance is an important strength to helpVietcombank compete with other competitors in future.

Moreover, the proportion of cash and balances with the State Bank of Vietnam in total assetswas decreased from 15.3% to 11.6% in the year 2009. It shows that Vietcombank has

maximized the effectiveness of the use of funds and while ensuring its liquidity. S3: Vietcombank has effective management with good services.

S3.1: Business management is effective.

Vietcombanks Board of directors has ability and long experience in the banking industry.Some members such as Ms. Nguyen Thi Tam - Deputy General Director of Vietcombank,Mr. Nguyen Van Tuan, Director and Vietcombank CEOs Special Assistant; Mr. Dao Minh

Tuan, Director of Vietcombank IT Center; and Mr. Pham Quang Dung, Director of Vietcombank Financial Institutions Department have graduated from universities abroad , sothat they have modern working style and administration. It is useful in economic integrationnowadays.

S3.2: The basic of technology is good .

As the first bank in Vietnam completed core banking in 1999, VCB has the more advantages

than other banks about the system of centralized data management and product development.VCB has been actively building the Center for Information Technology and development



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foundation of modern information technology, capable of supporting a maximum of bankingoperations with investments of about 20-30 million dollars annually for the solutiontechnology.

S3.3: Services of Vietcombank dominate in Vietnamese market.

Vietcombank has the advantage in the payment activity. Almost every financial institution inVietnam will open an account at VCB, plus the advantage of IT systems and bankingcorebanking helped shorten the time of payment, transfer money ... and improving servicequality. Ratio of net profit from these activities in total income increased; in 2008 this rate isnearly 11%. VCB accounted for 11.8% (estimated figures to 31/12/2008) market share of deposits of the banking system of Vietnam. Also, the VCB is considered the center of foreigncurrency payment of Viet Nam's banking system also offers advantages for VCB in themobilization and foreign currency business.

Whats more, about card service, the year 2008 witnessed an impressive growth in the Bankscard business: Vietcombank firmly maintained its leading position in number of cardholderswith 3.36 million newly issued cards, up 34.47% against 2007. International card paymentsoared to reach USD642.63 million (up 42% against 2007), making up 59.7% of national

card payment turnover. Continuously expanded and upgraded, ATM and point of service(POS) network throughout the country reached 1,244 ATMs and 7,800 POSs in total,strengthening the leading role of the Bank in payment network (vietcombank.com.vn).

S4: Vietcombank has a wide network in Vietnam.

S4.1: Business location is convenient.

In accordance with Vietcombank.com.vn especially in annual reports 2009, it is said that

Vietcombank today has grown into a universal bank with presence in all major cities and provinces throughout the country, comprising 1 Head Office in Hanoi, 1 Operations Centre,more than 300 branches and transaction offices nationwide, 3 local subsidiaries, 1 subsidiaryin Hong Kong, 4 joint ventures, 3 associated companies and 1 representative office inSingapore. The customer service network is further extended and diversified with 11,183ATMs and POS across the country. The Banks operation is supported by its relationshipwith more than 1,300 correspondent banks in approximately 100 countries and territories.

S4.2: Extensive network of clients, particularly corporations, large state enterprises .



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Vietcombank has a system of clients including many large enterprises, especially these businesses have activities related to import and export.

S4.3: Vietcombank has relationships with agencies widely.

Also thanks to the payment of import and export, Vietcombank is the first bank to buildrelationships with dealers and foreign banks and maintain a wide international network.Vietcombank has the largest international relationship with about 1200 banks in 85 countriesaround the world, and has hundreds of accounts at foreign banks such as Foreign Trade Bank of Cambodia, International Moscow Bank, Russian Joint Stock, etc (vietcombank.com.vn).This is a convenient chance for VCB to develop its service charge by providing services suchas international payments, money transfer, international payment cards, foreign exchange etc.

S5: Products and services of Vietcombank are diversified.

For more than 46 years of continuous development, Viecombank has projected itself as theleading banking service provider in Vietnam including traditional services such asinternational settlement and trade finance, fund mobilization, lending, project finance, etc. aswell as modern banking services such as treasury and derivatives, card service, e-banking andso on. The bank takes a significant market share in various business lines, such as: lending

(~10%), deposit taking (~12%), international settlement (~23%) and card service (~55%),etc. With advantage of modern banking technologies, Vietcombank is the pioneer in applyingadvanced technologies in automatic processing of banking services and launching electronic banking services e.g. Internet banking, VCB-Money (Home banking), SMS Banking, Phone banking in order to make banking services familiar to customers (Vietcombank.com.vn).

Weaknesses:

W1: Debit balance focuses on state-owned enterprises and retail in banking array develops

slowly.

In 1999, VCB opened the retail banking system VCB 2010 an advanced bankingtechnological product. The adoption of VCB 2010 facilitates the Bank not only to standardize business and operation processes, shortening transaction time of customers... but also be afundamental for technology development for the following years. However, currently the proportion of personal lending accounts for only 10% of total outstanding loans of Vietcombank, the proportion of personal businesses lending, small and medium enterprises is



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low. So to develop according to the right direction of a retail banks, Vietcombank will need a pretty big adjustment. For example, to enhance customer service quality, Vietcombank hasissued the Standards of customer service required for tellers and points of transaction; FeeSchedule for Individual customers, Criteria for retail banking activity assessment, etc.

W2: Bad debts have high proportion.

In accordance with Fitch Rating, it is illustrated the loan quality trends for the Fitchrated banks. NPLs (loans classified as substandard, doubtful and loss, generally 90 days overdue)ranged from 3.5% at Vietcombank to 0.7% at Sacombank at end20 09. SMLs (loansclassified in regulatory Class 2, generally at least 10 days overdue) show a different pattern.

At most banks, SMLs to gross loans declined, with the most notable exception of Vietcombank, whose SML ratio climbed to 5.5% at end2009.

However, in 2008, VCB's bad debt ratio increased to 4.6% and in the macro-economicconditions as the current difficulties, bad debts will continue to increase if bank looses credit back (vietcombank.com.vn). Causes lead to increasing of overdue debts situation atcommercial banks are: the lenders rely on collateral assets, while real estate market andcommodity market is underdeveloped and more complicated.



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Source: TVSI

W3: Small and medium sized customers and individual customers is difficult to approach

Vietcombank.

Because the VCB history mainly serves large customers, VCB will get troubles when it wantsto develop activities related to those objects, while this is growing economic area. So that

VCB improve its services to suit individual customers more by providing many other new products which have been implemented in various areas such as credit, bank guarantee, fundraising and internet banking.

Opportunities:

O1: The economy is recovering after the crisis, many businesses need capital, and this is a

great opportunity for development of commercial banks.

GDP data in quarter 3/2009 showed that Vietnam's economic is recovering remarkablythough the export sector remains difficulties. According to doanhnhantimes.com, EconomistIntelligence Unit forecasts that real GDP growth in 2009 will be the lowest in nearly twodecades and then maintained at an average of 6.5% from 2010 to the end of 2013. However EIU indicates that there are some obstacles for economic recovery. Some solution to recover economic in 2008 and 2009 may cause high inflation.



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O2: Vietnam's banking sector has huge potential to grow.

From 2002 to now, Vietnam's banking sector has very high growth rates; in there averagegrowth in debt is 29.3% and 27.7% was mobilized in a year. The reason is that the overallcombination of factors: high GDP growth, private economic growth and many new industriesin the early stages therefore develop faster and grow higher in trade etc.

In 2008, growth of the banking sector slowed slightly by the impact of the global economiccrisis and rising domestic inflation, but still achieved 21% growth in outstanding loans.Population of Vietnam is more than 83 million people, of which only approximately 10%own bank account. Banking services are unknown to many people, especially in rural areas.So Vietnam was still a potential market for the long-term commercial bank to invest.

Year 2000 2001 2002 2003 2004 2005 2010 (divisor)

Deposit/GDP 37% 43% 48% 52% 60% 68% 100%

Cash/Deposit 31% 31% 29% 28% 26% 23%

Source: NHNN v ACNielsen Vietnam

O3: International integration (joining in WTO) offers many opportunities for

Vietcombank.

After 2010, the intervention and protection of the state will reduced according to WTOcommitments. This is an opportunity to help Vietcombank demonstrate its capacity andqualifications. Besides, thanks to robust integration process, the bank will have theopportunity to learn experience, the level of technology and management from foreign bankswhich are often rated as financially strong, technology and executive management.

Joining in WTO means that foreign investors will come to Vietnam more and more. People'sawareness on the use of banking services will change. Number of individual accounts at



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banks will increase fast. These factors create an opportunity to expand markets, products andservices for the banking industry.

Beside the domestic market, the integration also creates for Vietnam's banking market

opportunities to expand foreign market in accordance with international commitments. Theintegration creates favorable conditions to help domestic credit organizations expand itsoperations into foreign markets through other forms of service provision in the WTOframework, especially commercial presence and supplying through border.

Threats:

T1: Competition in banking sphere is increasing remarkably, so that market share for

mobilization and lending capital is decreasing.

Currently, only 5 banks with 100% foreign capital (HSBC, Standard Chartered (UK), ANZ(Australia-New Zealand), Shinhan (Korea), Hong Leong Bank of Malaysia) operate inVietnam. Although these banks' market share is still small, but with the advantages of capital,experience, managerial skills, technology and personnel, they are formidable opponents.However, competitive pressures of the bank sector come not only from the appearance of more and more foreign banks, but also a competition between domestic banks together. For nearly 20 years, the number of banks has increased significantly. From 9 banks in 1991, toOctober in 2009, the market has a total of 43 domestic banks (three state-owned commercial banks, 40 joint stock commercial banks) (eHow.vn). The bank is constantly evolving both inassets and capital. Until 2008, total assets in whole of banking sector reached 1.7 million billion VND. And the bank also increased its charter capital to meet minimum capital of 3,000 billion VND in late 2010 under the provisions of the State Bank (eHow.vn). Obviously,with this momentum, only the competition to achieve mobilizing market share and lending

market share between domestic banks has also fierce. Currently, over 60% mobilizing marketshare and lending are in the hands of state-owned banks (eHow.vn). Thus, together with anincrease in the number of banks, piece of cake for stock commercial banks will increasingly be scaled.

No. Credit Institutions System in Vietnam Quantity1 State-owned Commercial Bank 52 Bank for Social Policies 13 Development Bank 14 Joint-Stock Commercial Banks 345 Joint-Venture Banks 5



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6 Branches of Foreign Banks 317 Representative Office of Foreign Banks 438 Finance Companies 69 Financial Leasing Companies 1110 People's Credit Fund 927

Source: SBV

T2: Deeper integration of banking industry brings more challenges for Vietcombank.

The competition among banks is increasingly fierce, especially after 2010. State interventionin business activities of banks will be increasingly reduced and protection is no longer under the WTO commitments. The State is primarily at the macro-management through policy.Before this context, Vietcombank need be more dynamic in business activities.

Moreover, human resources in banking field are also a challenge in the integration process.Unless human resource is good, conflicts will arise between the use of human resources andcompetition for development.

Whats more, the international integration that allows foreign banks to participate in all banking services in Vietnam forced the Vietnamese commercial banks have deeper specialization about banking operations, bank management, asset management, risk

management, improving credit quality, enhancing efficiency in using of capital, bankingservices and develop new banking services that foreign banks are expected to apply inVietnam.

Besides, risk management of banking system is still rudimentary due to inadequateknowledge and technology. Financial crisis in Asia in 1997 showed that the risk monitoring,system security is a very important issue of the economy and is a major challenge for theVietnamese banking system in the integration process.

T3: Macro factors such as economic, political and management policy have significant

impact on banking industry.

2008 was a typical year showed the impact of macroeconomic, political and management policies of the State Bank on the activities of banks. As a bank 70% owned by the State, theseeffects on the VCB is unavoidable and deeper with other stock commercial banks.

In the overall assessment of the Standard & Poor's (S & P) on Vietnam's weakness indicated

that the banking system is a high-risk, state owned large proportion. Policy is instability and



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uncertainty. For example, The countrys monetary policy is not addressed properly and notflexible enough, the central bank does not respond quickly and appropriately to risinginflation and excessive credit growth (en.baomoi.com).

Position of the VCB under International ratings agency Standard & Poors (S&P) is rated asfollow: Standard & Poor's Ratings Services has cut the outlook on its counterparty creditrating on Bank for Foreign Trade of Vietnam (Vietcombank) to 'negative from 'stable' and theratings agency has affirmed the counterparty credit rating at 'BB/B' (highbeam.com).Obviously, according to the evaluation of S & P, credit rating of VCB is equal to the ceilingnational credit rating for Vietnam. This is the highest rating of S & P for a financialinstitution in Vietnam.

T4: Credit activities are not really effective.

Access to customers information is more difficult. Banking activities is lack of appropriatesanctions when customers breach the credit agreement, causing damage to the bank. On theother hand, state enterprises are accounted remarkably in total outstanding bank credit. Thisis the business sector whose activities are often less effective than private enterprise and thesolving of problems arising when having overdue debts, bad debts are often complex. The

challenge to improve credit operations is extremely large.

Competitor of Vietcombank 1. Vietinbank: one of the main competitors

The Industrial and Commercial Bank of Vietnam (Incombank) was established in 1988 after being separated from State Bank of Vietnam. After carrying out IPO, the new brand name of Viet Nam Bank for Industry and Trade will be changed from Incombank to VietinBank in all

branches nationwide from 15 April 2008. Being one of the biggest banks in Vietnam,Vietinbank total assets account for over 20 percent of the whole Vietnamese banking system(Vietinbank, 2009). Vietinbank is the first bank in Vietnam was certified ISO 9001: 2000.The profession of Vietinbank is presented more clearly through the experiences of its staffs.Vietinbank always concentrates on the quality of staff with high education and qualificationsin order to run effectively the business organization of Vietinbank. Vietinbank also is thefirst bank in Vietnam which applies modern technology and e-commerce in its bankingoperations (Vietinbank, 2009). Besides, Vietinbank achieved some awards such as goldenCup for the third Trademark - Brand name ; award ISO golden cup IV 2008 held,



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elected and handled by Ministry of Science and Technology, The international qualityaward - International Star Award (ISAQ) at Swiss.

Strengths and weaknesses of Vietinbank are listed as below:

STRENGTHS

1. Strong and prestigious brand name indomestic

2. The branch network is large3. Healthy financial situation and

effective business4. Effective management, good services5. Diversified products and services

WEAKNESSES

1. Main field of business is credit thatcovers high risks from inexplicitfinancial report of companies, andunstable economics.

2. Complicated procedures and strictcredit condition

3. Cumbersome management system

Some figures to show the market shares of Vietcombank and Vietinbank



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Source: TVSI

2. Competitive environmentUp to the ending of 2010, Vietnam has had 5 state commercial banks; 5 joint-venture banks;5 banks with 100% foreign capital; 49 branches of foreign banks; 37 stock commercial banks.The following table shows the strong competition among big banks in the banking field interm of total assets (in compared with the whole banking industry), the market share inlending, and the market share in mobilizing, profit after tax.

Bank Total asset

compared toindustry (%)

The marketshare in

lending (%)

The marketshare in

mobilizing(%)

Proportion of after-tax

profit (%)

Proportion of after-tax profitcompared toequity (%)

Agribank 21.83 27.72 25.25 11.4BIDV 13.43 15.05 13.75 10.6 14.7VCB 12.1 10.41 13.22 13.58 18.39Vietinbank 10.55 11.38 10.24 9.66 14.63ACB 5.74 3.32 5.41 11.48 28.46Sacombank 3.73 3.33 3.88 5.11 12.31Techcombank 3.22 2.5 3.33 6.34 21.03EAB 2.43 2.89 15.33

Source: SBV



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However from August 2008, Vietnam government stopped providing license for establishingnew commercial banks to avoid the situation of so much existence of banks. This is a goodopportunity for Vietcombank to have enough time for prepare for the upcoming competition.From 2005 to 2010, the number of foreign banks and its branches increased. At this time,there are 5 foreign banks and 49 branches of foreign banks. The increasing of banks creates acompetitive pressure for Vietcombank (sgtt, 2010). Intensity of competition increases with bank upon the occurrence of groups of banks with 100% foreign capital. Foreign banks areusually available a specific customer segments, most of the enterprises from their countries.They have been serving these customers for a long time in other markets as consumers andexpand the market to Vietnam; the bank also opened representative offices. Foreign bankshave also not caught the barriers that now many banks are suffering, typically limit securitieslending, nonperforming loans in real estate lending. They do have the advantage early andhave many choices while no fewer banks in the country, this is not possible. In addition,foreign banks have many advantages such as superior service infrastructure, professionalcustomer service, better technology (typically Internet banking system). And his ability isimportant to connect with extensive networks in many countries of foreign banks. Tocompete with this group of banks, domestic banks have been equipped with technologyinfrastructure, products and services, human scale ... pretty. Advantages of domestic banksare close relationships with customers is available. Domestic banks are willing to lendflexibility to the incentives for their important clients (Trinh Viet Dung, 2009).A different point also making a high competitive level is not much difference betweenservices of banks. Almost banks in Vietnamese banking field has nearly same products andservices, it leads to high competition level towards Vietcombank as well as in the bankingindustry. Therefore the quality and price of service will be key factor to determine bankssuccess (Trinh Viet Dung, 2009).



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The strategic position of Vietcombank in Vietnam

TOWS Matrix

Strengths S

1. A trust and powerful brand in banking field.2. Strong financial

situation and business performance.

3. Effective managementwith good services.

4. A wide network inVietnam.

Weaknesses W

1. Debit balance focuses onstate-owned enterprises andretail in banking arraydevelops slowly.

2. Bad debts have high proportion.

3. Small and medium sizedcustomers and individualcustomers are difficult to



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5. Products and servicesare diversified.

approach Vietcombank.

Opportunities

1. The economy isrecovering after thecrisis, many businesses needcapital, and this is agreat opportunity for development of commercial banks.

2. Vietnam's bankingsector has huge potential to grow.

3. A trust and powerful brand in bankingfield.

SO Strategies

1. Vietcombank continuesto renovate andmodernize all aspects of banking activities tocatch up with standardof the regional andworld. (S1, S2, S3, O3)

2. Vietcombank seizes

chances, prove availableadvantages to developand expand activitiesefficiently in both widthand depth. (S1, S2, S3,S4, S5,O1, O2, O3)

WO Strategies

1. Diversification of banking products and services tomeet the increasing demandsof market economy andneeds of all customers (bothorganizations andindividuals). (W1, W3, O1,O2, O3)

2. Complete the process of restructuring the bank tohave an organizationalmodel of modern science, inline with the objectives andensure business efficiency,risk control, capable of

providing products andservices banking diversity inarray of retail banking. (W1,W2, W3, O1, O3)

Threats

1. Competition in banking sphere isincreasingremarkably, so thatmarket share for mobilization andlending capital isdecreasing.

2. Deeper integration of banking industry brings more

ST Strategies

1. Commercial bankingoperations are core,develop primarilywholesale and continueto expandVietconbanks domesticnetwork. (S1, S4, S5,T1, T4)

2. Enhancing capacity andcompetitiveness inintegration WTO by

WT Strategies

1. Focus on promoting capitalmobilization by developingan array of retail banking,logical credit growthcoupled with credit qualitycontrol to bad debt(classified by qualitative)must not exceed 3.5%. (W1,W2, T1, T4)

2. Develop new bankingservices for small and



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challenges for Vietcombank.

3. Macro factors such aseconomic, politicaland management policy havesignificant impact on banking industry.

4. Credit activities arenot really effective.

striving to improve theCAR reached only 10-12% and the otheimportant financialratios according tointernational standards,striving for ratings 'AA'under standard of international rankingorganizations. (S2, S3,T2, T3)

medium sized customers andindividual customers tocompete with foreign banksin the depth of economicintegration today. (W1, W3,T1, T2)

1. Vietcombank continues to renovate and modernize all aspects of banking activities

to catch up with standard of the regional and world. (S1, S2, S3, O3)

This strategy is suitable and possible for Vietcombank in short-term future. To set up this,Vietcombank takes full advantage of strengths such as a trust and powerful brand in bankingfield, strong financial situation and business performance, effective management with goodservices as well as some opportunities of a trust and powerful brand in banking field. One of the standards of the regional and world is CAR which is a measure of bank's capital safety,expressed as a percentage of a bank's risk weighted credit exposures. CAR is defined as (Tier 1 capital + Tier 2 capital)/Risk weighted assets *100 percent (stockbiz.vn). This is used to

determine the ability of banks' payments at all terms and ensure that it can face other types of risks such as operational risk. In other words, if banks are able to maintain this ratio atregulated level, they have created a safeguard against financial shocks, which could protectthemselves and the depositors.

From October 1, 2010, according to Circular No. 13/TT-NHNN dated May 20, 2010 of theState Bank of Vietnam (SBV), this rate would be adjusted to nine percent (the popular CAR in the world is 12 percent). Also according to qdnd.vn, the partly-privatised Vietcombank on

Sept. 7 received Government approval to raise their charter capital by 33 percent to 17.59



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trillion VND (902 million USD). The move aims to help increase the bank's capital adequacyratio (CAR) to 9-10 percent from 8.45 percent. Whats more, increasing CAR will ensure theoperation of the entire system, as banking operations become more risky. So that,Vietcombank should renovate and modernize all aspects such as about banking, securities,etc to improve and catch up with standard of the regional and world. Moreover, Vietcombank also should attract foreign investment to increase working capital. It is useful for Vietcombank to ensure requirements about CAR (9-10 percent) as now. This strategy is animportant stepping stone to help Vietcombank integrate deeper and develop further inoverseas markets.

2. Vietcombank seizes chances, prove available advantages to develop and expand

activities efficiently in both width and depth. (S1, S2, S3, S4, S5,O1, O2, O3)

For this strategy, Vietcombank holds opportunities (the economy is recovering after thecrisis, huge potential Vietnam's banking sector to grow and a trust and powerful brand in banking field) so as to maintain and enhance its strengths (a trust and powerful brand in banking field, strong financial situation and business performance, effective managementwith good services, a wide network in Vietnam and products and services are diversified).This strategy helps Vietcombank confirm its position in providing its services diversely while

there are more opponents in market such as ACB, Vietinbank, BIDV, ect.

3. Diversification of banking products and services to meet the increasing demands of

market economy and needs of all customers (both organizations and individuals).

(W1, W3, O1, O2, O3)

Most banks in Vietnam are moving toward this strategy. And Vietcombank is one of them. Itexpands products and services based on some chances (the economy is recovering after the

crisis, huge potential Vietnam's banking sector to grow and a trust and powerful brand in banking field), hence improve its weaknesses (debit balance focuses on state-ownedenterprises and retail in banking array develops slowly and small and medium sizedcustomers and individual customers is difficult to approach Vietcombank). Implementationof this strategy means that VCB is expanding its market share and business market.

4. Complete the process of restructuring the bank to have an organizational model of

modern science, in line with the objectives and ensure business efficiency, risk



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control, capable of providing products and services banking diversity in array of

retail banking. (W1, W2, W3, O1, O3)

To enhance concentration of debit balance on state-owned enterprises and develop retail in

banking array as well as decrease the proportion of bad debts and help small and mediumsized customers and individual customers approach Vietcombank better, this bank shouldrestructure to manage activities itself more efficiently based on some favorable chances suchas the economy is recovering after the crisis, many businesses need capital and the high position of Vietcombank - a trust and powerful brand in banking field. This strategy willimprove stagnancy of Vietcombank now and overcome obstacles about capital, management,so on in future.

5. Commercial banking operations are core, develop primarily wholesale and

continue to expand Vietconbanks domestic network. (S1, S4, S5, T1, T4)

Be a leading bank in Vietnamese banking field, Vietcombank focuses on commercial bankingoperations mostly. Besides, this bank should improve its strengths about brand, network anddiversification in products to get over some remarkable threats about credit activities andcompetition between other banks in Vietnam market. Therefore, this strategy is proposed to

enhance credit activities of Vietcombank by concentration more on wholesale as well asdomestic market.

6. Enhancing capacity and competitiveness in integration WTO by striving to improve

the CAR reached only 10-12% and the other important financial ratios according to

international standards, striving for ratings 'AA' under standard of international

ranking organizations. (S2, S3, T2, T3)

This strategy is a long-term objective to Vietcombank achieve in future. Based on strengthssuch as strong financial situation and business performance and effective management withgood services, Vietcombank try to solve some problems about deeper integration of bankingindustry as well as the impact of macro factors such as economic, political and management policy on banking field.

Fitch Ratings has today affirmed Vietnams BB- (BB minus) Long-term foreign currencyIssuer Default Rating (IDR) and its BB Long-term local currency IDR, but revised the



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Outlook to Negative from Stable. At the same time, Fitch has also affirmed its Short-termforeign currency IDR at B and the Country Ceiling at BB- (BB minus)(amchamvietnam.com). Vietcombank in particular and Vietnamese banking industry ingeneral should strive remarkably to get rating AA under standard of international rankingorganizations.

7. Focus on promoting capital mobilization by developing an array of retail banking,

logical credit growth coupled with credit quality control to bad debt (classified by

qualitative) must not exceed 3.5%. (W1, W2, T1, T4)

In accordance with qdnd.vn, Fitch Ratings recently lowered Vietcombank's individual ratingfrom D to D/E, removed the rating from Rating Watch Negative, and affirmed Vietcombank'sSupport Rating at 4. Fitch said the downgrade reflected Vietcom-bank's substantiallyweakened balance sheet that arose from excessively strong loan growth and the fragilequality of loans. Vietcombank's credit profile was said to be comparable to D/E-rated State-owned banks, even though the bank's loan to deposit ratio was among the lowest. Hence, toget higher ranking in individual rating, Vietcombank need develop more services for thiscustomers and focus on management business operations better to increase bad debt and risksfrom capital mobilization. This strategy is suitable and possible for Vietcombank in short-

term future because it minimizes Vietcombanks weaknesses such as debit balance focuseson state-owned enterprises and retail in banking array develops slowly as well as bad debtshave high proportion and avoid threats about competition and ineffective credit activities.

8. Develop new banking services for small and medium sized customers and

individual customers to compete with foreign banks in the depth of economic

integration today. (W1, W3, T1, T2)

Vietcombank gets more difficulty in debit balance because it focuses on state-ownedenterprises and retail in banking array develops slowly as well as small and medium sizedcustomers and individual customers are difficult to approach Vietcombank. Therefore, tocompete with domestic and foreign competitors, it is useful for Vietcombank in developmentnew banking services for small and medium sized customers and individual customers whilethis market share is potential and developing in future. In the depth of economic integration



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today, this strategy will help Vietcombank minimize its weaknesses and avoid some threatssuch as increasing competition in banking as well as deeper integration of banking industry.

Conclusion

Vietcombank now is known as the best bank of Vietnam. To have this success, it had toexperienced many difficulties in the past and after doing privatization, it has been reachedmany remarkable achievements. This also showes the positive aspect of privatization process in Vietnam. After many years keep going on and improve, Vietcombank now isthe top-ranking bank of Vietnam with a strong competitive ability and the commitment to

the customers is very good. Vietcombank always sets up many effective objectives toexpand and develop its business activities. As a member of WTO, Vietnam obviously



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must be influenced by global economy and global crisis. All economic parts withinVietnam will be under that impact including Vietcombank. However with support itself,Vietcombank expresses the economic rehabilitation and proves that Vietnam is a potentialdestination for foreign investors by striving to complete suitable and possible strategies inshort-term future such as Vietcombank continues to renovate and modernize all aspects of banking activities to catch up with standard of the regional and world as well as focus on promoting capital mobilization by developing an array of retail banking, logical creditgrowth coupled with credit quality control to bad debt (classified by qualitative) must notexceed 3.5%,enhancing capacity and competitiveness in integration WTO by striving toimprove the CAR reached only 10-12% and the other important financial ratios accordingto international standards, striving for ratings 'AA' under standard of international rankingorganizations, etc. All objectives Vietcombank points out so as to get the vision alwaysfor customers success.

References

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from:.



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3. BoMi.com, S&P praises economic progress, [online], (accessed 28th October 2010),available from:.

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Professional Education Aldine House, Aldine Place.

5. BPP professional education (2004) Organization and Behavior. 1st ed., London: BPPProfessional Education Aldine House, Aldine Place.

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