Developing retail banking services at Vietnam Joint Stock Commercial Bank for Industry and Trade in the context of international integration in banking and finance - 2

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Developing retail banking services at Vietnam Joint Stock Commercial Bank for Industry and Trade in the context of international integration in banking and finance - 2

(NHBL) of Commercial Bank

mentioned many times by researchers, managers, and experts at home and abroad such as: Anirban Bose (Director of global banking and finance research agency Global Banking & Financial Services ) ; team of researchers Daniel K. Orlow, Lawrence J. Radecki, and John Wenninger of the US Federal Reserve Bank (FED); Trinh Minh Thao, Hoang Nguyen Khai, Nguyen Van Thuy, Do Thi To Uyen, Nguyen Thi Thu Giang, Le Cong, To Khanh Toan etc...

To carry out the thesis "Developing retail banking services at Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) in the context of international integration in banking and finance", the author researched an overview of the research situation. Research, analyze, and evaluate confidential related research projects

set to the topic

thesis has been published

domestically and internationally. Uncle

body, total

review research projects on retail banking services of commercial banks in general and

Research projects related to Vietnamese commercial services in particular.

NHBL of Public Commercial Joint Stock Bank

Through general research, the author will reveal the research direction

main, theoretical basis, research methods, results achieved, conclusions and


out problems

still exists

in related research projects

The thesis will focus on solving this problem. From there, the author determines the thesis's objectives, content and appropriate thesis research methods.

1. Reason for choosing the topic

About the basis in theory . _ _ _ _ _ _ Currently, the concept of retail banking services is quite diverse and there is no consensus. There is a view that retail banking services are only services for individual customers, but there is also a view that retail banking services include services for individuals, households and SMEs. Regarding the scope of activities, in the field of retail banking there is currently a certain change, the provision of retail banking services is no longer the sole function of banks, it is considered a market, where there are participation of technology companies.

About real facilities . _ _ _ _ _ _ _ _ The issue of developing retail banking services of Vietnam's commercial banking system in general and Vietnam Joint Stock Commercial Bank for Industry and Trade in particular is placed in the context of Vietnam's extensive international integration in banking and finance. Especially from

In 2018, Vietnam's international integration was carried out on the foundation of the

New generation Free Agreement (FTA), competition in the retail banking service market is increasingly fierce. Besides opportunities, service management and development

Sales banks of commercial banks face many challenges and new factors

currently comes from

service providers

Foreign NHBL. This leads to

The strategy for developing retail banking services of Vietnamese commercial banks has been

Plans made many years ago must now be adjusted or even re-planned to suit new circumstances.

In Vietnam, with a population of more than 96 million people, more than 90% are businesses


and medium (SMEs), billion

Smartphone user rate (smartphone)

nearly 80% (2018)[81], the need to use banking services in general and

NHBL in particular is very large. About the banking system in Vietnam as of the quarter

As of March 2020, there are 49 banks. Of which, 4 commercial banks have 100% state capital (Agribank,

Oceanbank, GPbank and CB), 31 joint stock commercial banks, 9 banks

100% foreign capital, 2 policy banks, 1 cooperative bank and 2 joint venture banks[82]. The competition between banks is very large, in which retail banking services are an important part of the development strategies of these banks. Commercial banking services contribute significantly to increasing income for commercial banks, bringing convenience

Great benefits for customers, the socio-economy develops rapidly. Beside

next to that, also from

Competitive pressure is getting bigger and bigger

service segment

hey, the

Commercial banks are racing against time in planning and implementing retail banking service strategies to increase market share, improve service quality and quantity, and increase the number of customers.

number of customers. Ancient Commercial Bank (Vietinbank) is one of them.

Vietnam Industry and Trade section

Vietinbank is a bank with majority state capital. Regular reporting

Vietinbank's 2019 annual report shows; Total asset value is more than 1.2 million billion

VND, equity more than 77,000 billion VND, total credit balance more than 953,000 billion VND,

profit before tax

more than 11,000 billion

copper. Domestic network, Vietinbank

There are 155 branches, 07 member companies, 09 public service units, nearly 1,000 transaction offices in 63 provinces/cities nationwide. International network, Vietinbank has 02 branches in Germany, 01 subsidiary bank in Laos, 01 representative office in Myanmar, along with over 1,000 agent banks in more than 90 countries and regions.

territories in the world. As a top bank in the commercial banking system, Vietinbank is also a leader in providing retail banking services in Vietnam. However, up to now Vietinbank is still making constant efforts and encountering many difficulties in finding the right direction for this service segment. Because there is a reality facing the Vietnamese commercial banking system in general and Vietinbank in particular in the retail banking service segment:

(1) The plan for developing retail banking services has not been developed synchronously, leading to limited implementation efficiency.

(2) Distribution channels are diverse but there is no product coordination, there is overlap when deployed, the counter transaction method still prevails. The number of ATMs is located mainly in towns, urban areas and cities. POS machines have not been fully used.

(3) Banks have not found a common voice to connect and share technical infrastructure. Therefore, it causes waste in purchasing machinery and equipment and does not create convenience in using cards. This leads to limited access to banking services.

(4) There is no clear and effective marketing strategy in banking activities

retail, lack of professional staff in marketing retail banking services. Main

Customer policy is ineffective and service quality is not high.

(5) The

increasing presence of groups

Foreign credit institutions have


High management, technology

Modern, large capital, rich experience

in the NHBL service segment

(6) Information security issues have not met the requirements. Public platform

Technology and the ability to apply new technology are limited.

International integration in the banking and finance sector

International integration has become a trend and has become a reality in many countries. International integration is taking place strongly in many fields. Accordingly, in parallel with reaching out to the world market, Vietnam must also open its domestic market

countries, including the banking and finance sector. In particular, starting from 2018, Vietnam's international integration will go on the path of new generation Free Trade Agreements (FTAs), where the level of commitment is the widest, including nearly



goods and services

without exclusion;


Deep commitment

best; and muscles


Extremely executed

rigid ; _ _ and it includes


are considered "non-traditional" such as labor, environment, and home businesses

water, government procurement, transparency.

Reality shows that no bank is capable of fully satisfying all customer requirements. Often a bank has advantages in one aspect and limitations in another. Banks need to be aware of this

to enhance competitiveness through promoting good points

strengths that we have to best meet customer requirements. Have


So banks can


sustainable and developed market

part, benefit

profits under market opening conditions, with the increasing participation of domestic and foreign banks.

The current common situation is the competitiveness of Vietnamese commercial banks

Vietnam in general and Vietinbank in particular are still limited, so the ability to develop and affirm its position in the market (especially the international market) is not high.

Integration in the banking sector means gradually liberalizing and expanding the banking market according to international commitments. Thing

This has been creating opportunities for Vietnamese commercial banks

meeting to


But it also poses many difficult challenges to overcome.


First , the opening and integration in the banking sector, on the one hand

allowing domestic and foreign commercial banks to do business, compete and develop in a fairer and more equal playing field, on the other hand, creating favorable conditions for domestic commercial banks to penetrate the international market and open expand business activities. Integration also brings benefits to the Vietnamese banking industry

Men's muscles

international exchange and cooperation association

in the main planning area

financial and monetary policies, foreign exchange management, inspection, risk prevention and payment supervision, thereby enhancing the position and reputation of Vietnamese commercial banks in international banking and financial transactions, This is a limitation of Vietnam's commercial banks today.

Second , the market participation of foreign commercial banks increases the

health and safety of the entire commercial banking system. On the other hand, through the assembly

import, Vietnamese commercial banks have the opportunity to access capital, technology and experience

And level

management of developed commercial banks in the world

gender. Besides, to

To improve the quality of business activities and keep up with the development requirements of domestic and foreign markets, domestic commercial banks must proactively implement opportunities

Restructure the organization in a more reasonable and professional direction, increasing financial capacity

main, implementing deeper specialization in banking operations, improving

effective use of capital, training and retraining of staff. Those are the things

An important condition for Vietnamese commercial banks to operate their business effectively and efficiently

stand firm in competition.

Third , integration will create a driving force to promote innovation and improve transparency and self-responsibility of the Vietnamese commercial banking system to meet the requirements of integration and implement commitments . thereby improving operating efficiency in the monetary and banking sectors.

Fourth , integration will help Vietnamese commercial banks have opportunities to access and develop

develop a variety of services

and new modern, open banking facilities

wide and active

business operations while constantly improving the quality of customer service

products to compete better. Innovation will create motivation for the development of business activities of Vietnamese commercial banks.

Fifth , integration also requires an improved legal environment to implement international commitments, create an attractive investment environment, and encourage capital flows into the country through investment . direct investment and foreign indirect investment, creating opportunities for commercial banks to lend and mobilize larger capital.


First , Vietnam 's commercial banks are required to improve their financial capacity . _ _ _ _ _ _ _ _ _ _ Vietnamese commercial banks currently have limited financial potential, low asset quality, a product and service portfolio that is not diverse, product and service quality is not high, and an organizational structure that is not really reasonable. not yet professional, management level is still low, banking technology still has a significant gap compared to the level of the region and the world. Vietnamese commercial banks currently only have the advantage of a wide branch network distributing products, services and customers, and understanding local customs and business environments. However, these are not long-term, decisive advantages and will gradually disappear when the banking sector is truly fully liberalized.

Second , the international economic integration will show fierce competition and competition in the domestic market . _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ Vietnamese customers . _ _ _ Foreign commercial banks currently only hold a minority market share in the Vietnamese financial and banking market but will have an almost comprehensive advantage in the future when the Vietnamese State's restrictive regulations on commercial banks and Foreign credit institutions are gradually loosened to implement commitments to open the market in the banking sector.



economic integration


There will be many risks with these

Vietnam Commercial Bank, while the opportunity


Management is not complete, especially the engine


inspection, supervision, lack of close coordination and synchronization between relevant ministries

will be a significant challenge for Vietnamese commercial banks. If

Management and legislative capacity cannot keep up and cannot anticipate the rapid development of banking and financial transactions, there will be two possibilities: Either the banking industry loses its ability to control, leading to a crisis. crisis or the country will reimpose restrictions to maintain control. Both of these cases are harmful to the development of the banking industry.

Fourth , integration requires Vietnamese commercial banks to have a human resource that is not only highly specialized in banking operations but also knowledgeable about international trade law and fully equipped with knowledge and skills . skill

research, analyze, evaluate and forecast according to international models and standards, while the human resources of Vietnamese commercial banks are still very weak in the above knowledge and skills. This is a big difficulty for Vietnamese commercial banks.

Fifth , how will Vietnamese commercial banks develop in the context of the 4.0 Industrial Revolution taking place drastically in all economic and social fields .

From the above issues, the author decided to choose the topic "Developing retail banking services at Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) in the context of international integration in banking and finance"

2. Overview of research situation related to the topic

2.1. Domestic research

2.1.1. Doctoral theses

(1) In 2009, at National Economics University, author Hoang Tuan Linh was


Doctoral thesis "Service development solutions


at banks

" Vietnamese country trade " . _ _ _ _ _ _ The topic focuses on researching the development of card services, one of the products of retail banking services. The research space chosen by author Tuan Linh is commercial banks with state-owned capital, the big 4 banking group in Vietnam and also the leading commercial bank group in developing payment card services. The work summarizes the theory of services

cards, roles and characteristics of cards

pay. Service status


at the

The author focuses on describing and analyzing state-owned commercial banks, thereby highlighting the achieved results, remaining limitations and causes in the development of card services of state-owned commercial banks. Solutions to develop the project's card services in accordance with the State Bank's policies and closely following the stated problems.

( 2 ) Author Dao Le Kieu Oanh , in 2011 , successfully defended the topic " Development of wholesale and retail banking services at BIDV ”. Investment and development banking

Vietnam Development (BIDV) faces the practical need to transform from

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