GGRIGGS UNIVER GRIGGS UNIVERSITY GLOBAL ADVANCED MASTER OF BUSINESS ADMINISTRATION PROGRAM CAPSTONE PROJECT REPORT FORMULATION OF RETAIL BANKING SYSTEM DEVELOPMENT STRATEGY OF VIETINB
ORIENTATION ON EXPANDING AND DEVELOPING RETAIL BANKING
Objective of business stratepy by 2015 cerrrrrrrrrrrrrrrrrrrrrrrrrrrrtrtdrrrree 4I
- Fund resources: grows 15 -17% on average
- Outstanding loans: grows 10 -12% on average
- Non-performing loans: is sustained at below 3%/total loans
- Income-expense difference: increases by 10% on average
- Income: Ensuring salaries for laborers and including incentives in salaries
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3.2 SELECTING STRATEGY ON EXPANDING AND DEVELOPING RETAIL BANKING BUSINESS OF VIETINBANK BRANCH BA DINH IN 2012 — 2015 PERIOD
From evaluation on Strengths — Weaknesses of VietinBank Branch Ba Dinh, the group sets up SWOT Matrix as follows:
1 Stable political environment Legal environment facilitates retail banking development
2 Economic environment pulls RB service demand
3 Social environment suitable for RB development at urban area
5 The stipulation of cap interest rates helps big banks like VietinBank be chosen by customers to send more money This is the relevant period for VietinBank to promote the development of retail banking, to dominate the market and care customer more carefully
2 The society requires products are quality, different and more complex
3 Technology environment requires Vietinbank must have high investment
4 Competitors have more experience in the development of
RB services The banking sector in general and RB services in particular are under the fierce competition, requiring high capital investment and technology
2 Operation model 1s being rebuilt more mordern to suit the model of the world's large banks
3 VietinBank brand has come a long and had high reputation for Vietnamese people |
4 As bank with large size and extensive network
CrR ơ“ deposits of which non- term deposits account for
8 Personnel is going to perfect the structure and test the new model so it’s able to arrange suitable staff,
SEs, not flexible and spreading size
10 Current technology 1s still weak compared to other banks
3.2.2 QSPM Matrix have the characteristics of
II Developpement of many products and services without the
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Defensive Strategy: Do not expand into retail banking
In the scope of this project, the group has selected two key strategies related to the project, namely:
Key factors — Market Development |Market penetration Base terial on attractiveness score
Attractiveness Attractiveness attractiveness attractiveness score score score score
1 Stable political and Having the same
2 Open economic _ |Having the same
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3 Supporting policies PI ÉP 4 § 4 § Having the same | Ẻ from the Government response this
4 Populated population, 3 - 9 Z ~ 3 ‘The second strategy potential market better responses to
5 Demand for banking [ | The first strategy
6 Industry rivalry SẮC Having the same
7 Scale and quality _ The first strategy
3 6 3 4 development of banks better responses to
8 Fierce competition in Having the same
9 Increased risks in _ a ‘The first strategy
3 6 2 4 integration process better responses to
10 Customers’ | | | [ ‘|The first strategy requirements for quality 3 9 “ 6 better meets this of banking products and criterion
| Technological and - “| Mì _ Having the same
2 Good financial | - ‘It is more effective to situation and credit 4 12 2 8 focus on the first supply _ eee strategy
3 Ensured quality of the The first strategy will
5 9 2 6 staff be more appropriate xa | The first strategy will
4 Brand prestige 2 8 3 12 by be more appropriate
6 Interest gained 3 6 2 4 ; brings more interests
He Dependence on oO Having the same
VietinBank response a | The first strategy
8 Operating cost 4 12 2 6 saves more cost
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From the above strategy alternatives, GREAT matrix is used to select the best one:
Criteria 5 ST SO WO WT
Rating | Score | Rating | Score | Rating | Score | Rating | Score
Conclusion: ST strategy is chosen as its score is highest
3.2.3 Determination on strategy of VietinBank Branch Ba Dinhin 2012 — 2015 period Via SWOT and QSPM matrices, after evaluating the strategy on retail banking business has higher attractiveness score, the group has detailed strategy for business activity of VietinBank Branch Ba Dinh in 2012 — 2015 as follows:
Table 3.4 Selected strategy and supporting strategy
1 Market Development Strategy Taking advantages of brand
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Determination on strategy of VietinBank Branch Ba Dinh in 2012 — 2015 EiGfGÔ sen 45
Table 3.4 Selected strategy and supporting strategy
1 Market Development Strategy Taking advantages of brand
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Based on the number of current customers,
2 Strategy of diversifying investment | analyzing groups of customers and groups of portfolios individual products and forecast risks in the future
Using new technology and making use of
3 Strategy on optimizing credit risk analysis capacity of information system to manage credit risks.
SOLUTIONS TO IMPLEMENT THE STRATEGY ON RETAIL BANKING
Diversifying the investment porfÍỌIOS c+++rrtreretttttrrrrrttrrrrrrrtrrrrrrrrrrrrrtrrr 45
- Reviewing and evaluating cach retail banking products, which are being established in terms of size and quality, as well as predicting its risks
- Adjusting and regularly replace products of the high-risk products with the low-risk ones, or those which never been implemented at VietinBank Branch Ba Dinh
- Establishing and developing effective products which were successful launched by other institutes while VietinBank Branch Ba Dinh has not implemented or even established with little attention and uniformity
Complete the model of retail banking management and operation
VietinBank’s professional and efficient retail banking hinges on a synchronized, uniform model deployed from headquarters to branches This framework requires the headquarters to consolidate its administrative role while branches operate as professional sales organizations with independent divisions handling individual customer relationships, supported by deputy directors, transaction offices, and dedicated units that back retail banking activities.
Improving appraisaÌ - -.2xsexe eereere 1.n1110.8100121101101000110100 101 46
- Regular training and retraining in credit operation and enhancing knowledge of business finance, law for credit officers to improve the quality of this team Good
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WUNTEVER SITY analysis of business finance is a very important stage in appraisal to provide accurate proposals for credit facilities and reduce risks in the future
- Dividing management according customer groups, especially selected good ones who have deep understandings of corporate finance to work in business credit groups
Enhancing governance and credit control begins with clear leadership and ongoing ethics guidance for officials Regularly disseminating ethics standards helps prevent corruption, misrepresentation, and fraudulent loan applications that could influence lending decisions A robust ethics framework, strong internal controls, and continuous training equip staff to assess credit fairly, detect red flags, and uphold compliance with regulatory requirements By prioritizing transparency, accountability, and proactive risk management, financial institutions can safeguard lending integrity, reduce fraud, and build trust with borrowers and stakeholders.
- Establishing independent evaluation of credit staffs, with a regular task to capture, analyze and process customer information for assessment tasks, branch-level credit.
Expanding the network and attracting CUS{OI©TS -: -cs+ccsrrenteeherrtrrertrttrrrrrtrre 46 3.3.4 Improving organizational model and boosting quality of human resOurccs
- Reviewing and analyzing the effectiveness of each transaction office in the network
To maintain and develop additional transaction with high priority in the new urban areas in the near future, also called "going in advance”
- Improving service quality to attract customers in order to adequately satisfy the needs of customers To improve service quality, VietinBank Branch Ba Dinh need to:
+ Building a team with a professional qualification, have a sense of responsibility, serious working style, honesty and openness with customers
+ VietinBank Branch Ba Dinh should improve its procedures towards convenience and friendliness with customers, making customers feel comfortable when dealing with the bank
Each transaction office should designate a staff member in charge of providing clear guidance and promptly answering client questions, ensuring the highest standard of professional service to safeguard the interests of both customers and VietinBank Branch Ba Dinh.
3.3.4 Improving organizational model and boosting quality of human resources
To optimize VietinBank Ba Dinh's organizational model, the bank will consolidate its structure to align with its current scale and future growth The new framework will be compact and effective, ensuring smooth, secure operations and enabling agile decision-making across functions as the business model evolves.
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- Improving the quality of human resource: Rapidly and effectively implementing and deploying the training and retraining of staff, consolidate staff in the whole of VietinBank Branch Ba Dinh
- Adopting strategies to attract talents: Building special treatment policy for professional staff, the staff with high experience in management
- Building a work system and an effective, specific and clear division of labor in order to evaluate accurately the work performance of employees
VietinBank Ba Dinh Branch operates on a customer-centric principle, placing the satisfaction of each client's needs at the forefront It delivers professional, modern banking services and maintains an open approach to direct customer interviews The branch systematically collects customer feedback through satisfaction surveys to identify weaknesses and drive continuous improvement, ensuring high service quality and a superior banking experience.
VietinBank Branch Ba Dinh builds its brand through a multi-channel marketing approach that includes television, local radio, leaflets, on-site staff outreach, and billboards aimed at office clients, complemented by the annual customer conference to engage stakeholders, capture proposals, and identify customer needs that the bank can address more promptly.
- Improving website quality of VietinBank Branch Ba Dinh to provide fully information about products and services of the bank
Develop a solid customer base and maximize customer value
Developing a large, stable customer base and offering a wide range of banking products and services are core objectives of VietInBank Ba Dinh’s retail banking, serving individuals and households who use financial services for consumption and production needs For each product group or service, it is essential to define appropriate segmentation criteria, combining the pyramid model with other relevant measures such as region, age, occupation, education level, and gender Based on the development and application of these market segmentation criteria, the bank identifies target customer segments and designs tailored policies across product features, distribution channels, and pricing strategies.
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PR ) in accordance with cach group of customers The customers can be grouped as follows:
> Group of medium income clients
By establishing a customer relationship management (CRM) system and a data-driven customer analysis method anchored in a customer scoring framework, supported by technology and information, we maximize the fit between customer needs and our product offerings, delivering a broad and appropriately tailored range of products that increases customer value.
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SOME RECOMMENDATIONS Ặà chen nh tre 48 1 Recommendations to the State and the OovernmeTii -‹ -++++eteeertrrrrrrrrrrrrrrrrrre 48 2 Recommendations to the State Bank of Vietnam (SBV) - -‡ccrherrrtrrrrrrre 49 43 Recommendations to Vietnam Jọnt Stock Commercial Bank for Industry and Trade
3.4.1 Recommendations to the State and the Government
To sustain a stable political and socio-economic environment, the state should establish a stable, predictable, and long-term macroeconomic framework that stabilizes the macro-economy and creates a reliable business climate across the entire economy By maintaining consistent policy, prudent fiscal and monetary measures, and transparent governance, this framework supports sustainable growth and resilience to shocks In turn, a stable macroeconomic environment attracts investment and enables businesses to plan with confidence, driving broad economic prosperity.
By promptly aligning the standard legal framework with international norms, we enable full integration into the global economy, create conditions that encourage enterprise development, and ensure that businesses operate effectively under the rule of law This approach provides stable, equal development opportunities for all enterprises across every sector and field, fostering sustainable growth, fair competition, and a resilient, business-friendly environment.
- Having close regulations in establishing enterprises, supervising the situation that enterprises are established massively without capital for operating or operating ineffectively
- Completing dispute settlement mechanism related to loan insurance and treating mortgages Promulgating legal document to accelerate compulsory sale of mortgages at banks
3.4.2 Recommendations to the State Bank of Vietnam (SBV)
Adopt a flexible, integrated approach to monetary and fiscal policy to boost the effectiveness of monetary policy through tools such as open market operations, rediscounting, and refinancing, while tightly coordinating fiscal measures to monitor and control all cash inflows into the economy, especially those stemming from the state budget and non-banking financial institutions.
Completing the reform of the State Bank of Vietnam to transform SBV into a genuine central bank is a strategic priority The reform strengthens SBV’s relative independence from the Government, enhancing the effectiveness of monetary policy It also consolidates SBV’s autonomy in formulating and implementing policy, establishing its clear role and self-reliance in monetary policymaking.
Strengthening the State Bank of Vietnam’s inspecting and supervising role over retail banking ensures secure and efficient operations while preventing unhealthy competition among commercial banks By overseeing retail banking activities, the SBV safeguards financial stability, protects consumers, and enforces prudent risk management, transparency, and compliance, creating a level playing field that supports sustainable growth in the Vietnamese banking market.
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Expanding and upgrading the information system is essential to prevent risks and to ensure the accurate and timely delivery of customer information to banks A strengthened customer information system helps reduce data gaps at commercial banks, enabling better risk assessment, decision making, and financial stability It is recommended that the State Bank of Vietnam (SBV) promulgate regulations governing the exchange of information among banks to standardize data sharing, enhance transparency, and support a more resilient banking sector.
3.4.3 Recommendations to Vietnam Joint Stock Commercial Bank for Industry and Trade
- Improving proactiveness to branches and transaction office in business activities on the basis of potentials and internal forces of each branch
- Having encouragement policy for branches with effective operation, bringing high profit for the Bank
Leveraging software technology, we enable VictinBank’s branches to develop a multi-dimensional information system that integrates data across units and enhances decision-making We conduct rigorous assessment and implementation of an appropriate risk management framework in line with current regulations and the bank’s operating characteristics, while conforming to international standards and best practices.
- Regularly opening training and knowledge fostering classes to enhance professional qualification for the staff to catch up with the current development trend of finance- banking sector
- Quarterly marking credit rating of branches to have orientations for the branches in each stage of development
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Vietnam's economy and its financial market have become increasingly integrated with the global economy, reflecting deeper international linkages and openness Although Vietnamese enterprises have grown rapidly in both quantity and quality, creating numerous opportunities, they also face significant difficulties, challenges, and potential risks in this more interconnected environment.
From 2012 to 2015, Vietnam's economy will undergo significant changes in its competitive environment, shifting from domestic competition to international competition The Vietnamese commercial banking system will accompany enterprises under the pressure of international economic integration, forcing banks—including VietinBank Ba Dinh Branch—to prepare for deeper integration and development To remain competitive in the global market, these banks must strengthen capabilities, adapt products and services, and align with international standards.
VietinBank Ba Dinh Branch must undertake timely changes to withstand difficulties and pursue sustainable development By building real strength, enhancing capabilities, and aligning with a clear strategic orientation, the branch can better adapt to a changing market environment and actively participate in the shared financial ecosystem.
Group10- Gamba.X0810- thank to ETC Center, teacher who taught and graduated guideline and gave career enthusiasm to transmit experience to MBA student
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