Internship report - HDBank - 2013-2014

BCTN tại Ngân hàng TMCP Phát triển TP HCM HDBank Thành Công

I Brief introduction of the Organization Business Sector

1 Overview of the organization

1.1 Brief history

Ho Chi Minh City Development Joint Stock Commercial Bank, abbreviated as HDBank,was founded on 4th January 1990; with its present head office based at 25 Bis NguyenThi Minh Khai, District 1, Hochiminh City HDBank is one of the pioneering joint stockcommercial banks in Vietnam Its initial chartered capital is 3 billion VND and it isresponsible for mission of “providing international standard products and financialservices, satisfying the various demands of customers”

After 24 years, HDBank has achieved chartered capital of 8.100 billion VND, total assets

of nearly 90.000 billion VND Its typical shareholders are Viet Nga InfrastructureInvestment Corporation - SOVICO Holdings, Hochiminh Finance and Investment state-owned Company – HIFU, Tan Thuan Industrial Promotion Company – IFC, ThuducHousing Development Corporation – Thuduc House, Saigon Real Estate Corporation –RESCO, Saigon Trading Group – SATRA and so on

HDBank was equipped the modern information technology system – Core Banking –with international standard It also developed a network of about 200 branches andtransaction offices available in most the largest economic centers of the country such asHochiminh City, Hanoi, Danang, Nha Trang, Binh Duong, Can Tho with a total staff ofabout 4.000 people

HDBank built up their reputation in finance and banking market, especially in creditfield, developed a solid platform and overcame the difficult and challenging periods

HDBank’s business operation including, mobilizing capital (short-term, mid-term, term in different methods such as limited, unlimited and certificates of deposits (CD);receiving investment and development capital from national organizations, borrowingfrom another credit institutions), lending (short-term, mid-term, long-term), discountingcommercial papers, bonds, executing interbank payment service, trading foreigncurrencies, bullion in domestic and foreign markets according to international standard,conducting international payment transactions, mobilizing capital from foreign countriesand implementing another banking services in accordance with foreign banks.

long-With the rapid and strong development of HDBank during recent years, HDBank hasachieved outstanding results, completed organization restructuring and accumulatedfinancial resources, products, services, human resource, technology and so on to be ready

to start a stronger developing stage of HDBank

During its operation, HD bank has won a range of titles and awards from prestigiousorganizations nationally and internationally, including, “The best savings bank” (by

Vietnam Economic Times), “Chief Security Officer (CSO) ASEAN Awards 2012” (by International Data Group - IDG), The Gold Award in “Annual Report Competition Vision Awards 2012,2011” (by League of American Communications Professionals- LACP), “High Straight-Through Rate for Payment Processing” (by Wells Fargo Bank),

“Global Payments Excellence Award (by Citi Group), “Prestigious Southeast ASEAN Brand Award” (by Vietnam Intellectual Scientific Forum), "The best local Cash Management Bank" (by Asiamoney Magazine) and so on.

HD Bank sets out the strategy for 2014 of continuing effective and multi-functionaloperation target, providing the best service for corporations, investment and retailbanking, international network development Therefore, HD Bank will focus on four

specific action programs, which are, credit effectiveness; safe operation; service qualitypromotion and cost control HD Bank will endeavor to fulfill these criteria, including,total assets of 104.607 billion VND, mobilization of 76.000 billion VND; 53.700 billionVND in lending; pre-tax profit is 1.028 billion VND; ROA: 0.81%; ROE: 9.52%.

1.2 Nature of the organization

As can be seen from the name “Ho Chi Minh City Development Joint Stock CommercialBank”, its operation is the same as normal commercial banks

Besides developing the general operation, HDBank orients to build a business culturewhich is energetic, transparent, humanistic and professional as well as promote socialactivities, contribute to protect national security

In the market, HDBank possesses a lot of strengths, of which outstanding products areenterprise finance and individual customer products and services Since establishmentdate, HDBank always grew well at the activities of credit, capital mobilization as well asthe other service activities such as guarantee, investment, international payment, etc Formany years, HDBank has been on the top of the group of Joint-stock Commercial Banksand classified A level by the Bank of State In addition, HDBank has received highappreciation from experts about reputation, profession and product quality It becomesmotivation for HDBank to reach the international market

1.3 Business volume

Figure 1: Some financial indicators in the period of 2009-2013

(Source: HDBank Annual Report)

Unit: billion VND

Total Assets 19.127,427 34.389,227 45.107,227 52.782,831 86.226,641

Equity 1.796,164 2.357,637 3.547,632 5.393,746 8.599,548Chartered

653VND/share

 Short-term Gold Certificate of Deposit

 Electric bill settlement

 Make a payment for VietJet Air tickets

 Loans:

 Personal installment loan

 Home construction/ repair loan

 Loan on mortgage/ Savings – book discount loan

 Study abroad loan

 Personal consumer loan

 Cash advance of sale - stock

 Supporting Business capital loan

 Business Installment loan

 Cards and other services:

 Card products

 The identified domestic Debit Card

 Prepaid card – HDBank gift card

 Co-branded card Securities Card

 HDBank Master Card international credit card

 Smart card – HD Card

 Term deposit with prepaid interest

 Term deposit with flexible capital withdrawal

 Short-term certificate of deposit

 Automatic accumulation deposit account

 Payroll/ Commission services

 Centralized deposit account

 Other services

 Fax transactions

 Electric Bill

 Credit and Guarantee

 Working capital finance

 Business production loan

 Overdraft

 Cashew nut loan

 Rice loan

 Export finance

 Export finance prior delivery

 B/E and export documents discount

 Loan guaranteed by export receivables

 Import finance

 Import finance

 Medium – Long-term loan

 Term loan for fixed asset/ project

 Car loan

 Special loan for small and medium enterprise (JBIC, JICA3)

2 Organizational structure

2.1 Organizational chart:

Figure 2: Organizational Structure of HDBank

(Source: HDBank Annual Report 2012)

2.2 Number of employees:

Figure 3: The amount of staff

(Source: HDBank Annual Report)

2.4 Introduction of all departments:

There are numerous departments of each division in HDBank

Corporate Customer Division

It includes 3 departments: Policy and Product Development Department (Dept),International Payment Dept and Sales Management Dept This division provides bankingservices for corporations, acts as an intermediary for enterprises It includes ODA creditoperations, large trading on the inter-bank market, co-financing activities and otheractivities.

Consumer Banking Division

It includes 4 departments: Product Dept, Sales Support Dept, Card Dept and Sales andService Centre The customers are individuals, households and who have stable income atmiddle level and above, household business customers in production, sales, services, etc.This division provides customers a product portfolio of standard service, diversification,multi-utility, applying international standard, at high quality, based on moderntechnology and appropriate for each type of customer in which focuses on developingstrategic products

Treasury Division

 Treasury Department

 Investment Department

Risk Management and Control Division

It includes 5 departments: Risk Management and Control Division, Asset EvaluationSection, Legal Dept, Internal Control Dept and Non-performing loan Collection Dept

This division plays an important role in monitoring the risks associated with all activities

of the bank and acts as a strategy partner to the business units, give them advice on riskissues of their projects

2.5 Comments on the organizational structure:

HDBank has an obvious organizational structure Each department of the bank has oneheading person These departments also have been further departmentalized based onneed to serve the customer with the best-quality services

The departments in HDBank’s system are operated independently but have strongrelationships, mutual support through regular meetings to implement the common targets

of this bank

II Internship activities

1 A brief introduction of HDBank Thanh Cong

With the promise of providing best benefits for customers, HDBank always concentrates

on developing network as well as operation results On 26th February 2011, HDBankopened two new offices in Hanoi HDBank Thanh Cong was one of them With modernand customer-friendly transaction office system, HDBank has been promoted servicequality and become the destination satisfying all the demand of finance and banking ofpeople

1.1 The organizational structure of HDBank Thanh Cong

Figure 4: The organizational structure of HDBank Thanh Cong

1.2 Some activities results of HDBank Thanh Cong

Figure 5: The situation of capital mobilization at HDBank Thanh Cong

(Source: Annual Report)

Credit

Department

SalesDepartment

TreasuryDepartmentAccounting

Department

2 Starting and ending dates of internship:

Starting date: 20/02/2014

Ending date: 18/05/2014

3 Detailed description of the department student worked in during internship

HDBank Thanh Cong was established and officially went into operation on 26 February

2011 and had registered office location in 101 & 201 – C18 Nguyen Hong, Lang HaStreet, Dong Da District, Hanoi, Vietnam HDBank Thanh Cong is one of transactionpoints of Hanoi branch

At the beginning, I felt a little bit nervous when joining the internship program But after

my first day at work, my nervousness disappeared The staffs at the bank were veryfriendly and kindly The working environment is very healthy and energetic

I worked in Accounting Department which deals with the steps relating to all activities ofaccounting and direct transactions such as opening cards, savings book, introducingproducts, etc for both corporations and individuals I was guided to work and beresponsible for the position of a teller My duty is checking the profile of customers whowant to open cards or saving books If the documentary is efficient and legal, the otherstaff in this department will help me record and submit for approval to implement thenext steps In addition, I also supported to check the accuracy of books and theconciliation at the end of day

I gained the knowledge of accounting, how to use the banking software as well as how toavoid common mistakes I also understand more about the lessons that I learnt in theclass

III Critical analysis:

Internship program helped me transform my academic knowledge learnt from varioussubjects into practical knowledge in HBank Thanh Cong This position requires theemployees to be very good at communication skills, carefulness, proper understanding ofthe process implementing transactions In internship period, I was instructed about theseskills I applied the theoretical concept of financial ratios which was taught in class toanalyzing the financial statements in practical experience in HDBank Thanh Cong

1 Achievements

Thanks to advantages such as stable, steady business environment and attractive policies;moreover, DaiABank merger and SGVF acquisition, HDBank has many advantageousopportunities to approach customers in recent years There are some results below:

 The increase in total assets, chartered capital and transaction offices

 The expansion in customer categories

 The improvement of bank staff’s qualification

In summary, HDBank has an impressive speed of development In comparison with otherlarger banks in Vietnam, HDBank is still a new bank However, HDBank has achieved

great successes “The best savings bank” (by Vietnam Economic Times), “Prestigious Southeast ASEAN Brand Award” (by Vietnam Intellectual Scientific Forum), "The best local Cash Management Bank" (by Asiamoney Magazine) are the best proofs for

HDBank’s efforts In this, HDBank Thanh Cong contributed by awards such as

“Excellence Savings Office 2013" and “Excellence Mission Complete 2013”

2 Limitations and causes

2.1 Limitations:

Besides the great success that HDBank Thanh Cong has achieved in recent years, therestill remain a lot of shortcomings that have negative impact on the development ofHDBank Thanh Cong

 Lack of high-technology facilities

 The undiversified customer categories: HDBank provides services for bothindividuals and corporations; however, its main customers are still individuals

SWOT Analysis of the organization:

Strengths:

 Ability to limit the difficulties

 Board of Directors’ instruction, Board of Management’s dynamics

 Well-known and professional HDBank brand

 Stable and new organizational structure

 Effective operation

 High technology system

Weaknesses:

 Lack of scientific organizational scale

 Less attractive reputation compared to large banks

 High margin fee

 Economic difficulties:

Economic difficulties also affect the commercial banks, as incomes from servicesdeclined sharply Many customers tend to restrict the use of commercial bank services inorder to cut their input costs In addition, the world’s economic problems also affect theenterprise in Vietnam due to high input costs Many companies go under and cannotadapt the high lending interest rates As a result, it is not easy for banks to find the properborrowers in 2014

 Risk of Defaults:

The failure of projects can make the bank get into difficulties to recover their funds fromthese defaulters

 Trend of banks merging:

There is a trend of mergers among the banks to become prominent in the market and toget the maximum market share This trend can result into the union of some leadingbanks which can give tough time to the bank and it will become difficult for the bank tocompete with them

 Trust of customers:

Recently, there were many scandals in banking field that make the belief of people inbanking system go down Banks have to face with customer’s worries

IV Conclusion

The integration into the World Trade Organization (WTO) has had active impacts onVietnam economy such as high foreign direct investment, expanded export and importmarket Besides opportunities, Vietnam is still facing a lot of challenges Takingadvantages of chances, dealing with all difficulties are two top duties of our country.With a view to supporting nation development, establishing a solid position in domesticand foreign financial market, HDBank in general and HDBank Thanh Cong in particularmust be well aware of developing capital mobilization

On the basis of various study method, theoretical knowledge, the internship report hasalready completed three main tasks First of all, the report has collected and analyzedtheoretical problems about capital mobilization systematically then delved intoresearching this method After that, some financial and nonfinancial norms are introduced

to show the real situation Moreover, the report has also mentioned subjective andobjective factors influencing the quality of services Due to the limit of conditions andresearch time, graduation thesis still has a lot of insufficiencies It is my honor to givesupport and advice from all teachers and my school- fellows

Hope that my report and petitions will make a small contribution to develop capitalmobilization at HDBank Thanh Cong so that this bank can be improved much better inthe near future As a consequence, Vietnam economy integrates more widely and deeply

to the world economy in upcoming years