internship- capital mobilizing in agribank trangan

STATE BANK OF VIETNAM

BANKING ACADEMY

INTERNSHIP REPORT

CAPITAL MOBILIZATION SITUATION

IN TRANGAN BRANCH – AGRIBANK

FROM 2011 TO 2013

BY

NGO THI THU TRANG

Student ID: 14A7510252

Class: ATCA-K14

Foreign language faculty

Internship Report Banking Academy

STATE BANK OF VIETNAM

BANKING ACADEMY

Bachelor in English Program

Translation and Interpreting / Finance and banking

ATCA-K14

Ngo Thi Thu Trang 1 ATCA K14


State of Affirmation

I hereby declare that the term paper submitted was in all parts exclusively prepared

on my own, and that other resource or other means (including electronic media and

online sources), than those explicitly referred to, have not been utilized.

All implemented fragments of text, employed in a literal and/or analogous manner,

have been marked as such.

=============================

Name: Ngo Thi Thu Trang

Class: ATCA-K14

Student code: 14A7510252

Hanoi, May 25th, 2015 Signature



Dedication

I dedicated this Internship Report to my parents, all staff in Agribank TrangAn branch

and Banking Academy.

In recent months, I have practiced in Agribank TrangAn branch. During my internship

time, I made attempt to adapt to a business enviroment and apply all I had learned to

complete my mission in practical works. Therefore, I have gained the worthy experience.

The predecessors here have guided me with enthusiastic and professional attitude. They

gave me so much support and taught me how to learn a practical life. They also gave me

different tasks which brought more and more knowledge and guided me when I

accomplished the tasks. I am very grateful for which they did for me. Besides, I also want

to give my parents many thanks because they always support me everytime.

Acknowledgement

I would like to express my immense thankfulness to all people who gave me the

possibility to complete this report. I would like to thank the library staff of Banking

Academy for their support in making access to research data and literature possible. My

most profound gratitude goes to my family, friends and relatives for their unconditional

love and steadfast support always.

Especially, I am deeply indebted to Mr. Trinh The Cuong – Vice Director of TrangAn

Branch, who had zealously instructed and helped me a lot in the past two months.

Simultaneously, I sincerely thank all staff for their enthusiasm in guiding and giving me

invaluable guidance and comments.

Executive summary

According to the plan of the University, my internship period lasted two months. Thanks

to the introduction of our University, I practiced at TrangAn branch of Agribank. During

this time, I went to the company to observe and learn about the organization structure, the

functions of departments, the business content and the management operation of the

branch.Ngo Thi Thu Trang 3 ATCA K14


Agribank TrangAn branch has good business performance. Over the past years, with all

they spent and achieved, they could be proud and confident of branch’s development

future. The enhancement of capital mobilization has been still a top priority in their

orientation. It's also an extremely urgent activity which contributes to improve their

competitive ability in the international integration conditions, because it helps the bank

meet their needs of business operations.

However, the mobilization of this branch still has some unreasonable problems. They lead

to high capital costs, fluctuate scale, thereby limiting profitability, forcing banks to face

risks ... Thus, the strengthening of capital raising with a reasonable cost and high stability

has become more urgent and important.

There are the reasons why I have chosen the theme "Capital mobilization situation in

TrangAn Branch of Agribank" for my internship topic.

The structure of the thematic including 3 chapters:

Part 1: Introduction about Agribank and TrangAn branch.

Part 2: Description of the internship.

Part 3: Recommendations and Conclusion.

Nevertheless, due to time and knowledge limitation, it is impossible to avoid

shortcomings and mistakes in my report. Therefore, I truly expect my instructor’s

sympathy and concessions in assessment. I am looking forward to contributing comments

to amend this report.

Hanoi, May 25th, 2015



Table of contentsPart 1: Introduction about Agribank.....................................................................................................6

1.1. Overview of Agribank............................................................................................................7

1.1.1. Brief history.......................................................................................................................7

1.1.2. Nature of organization.......................................................................................................8

1.1.3. Business volume................................................................................................................8

1.1.4 Competitors........................................................................................................................9

1.2. Organization structure..........................................................................................................9

1.2.1. Organizational chart...........................................................................................................9

1.2.2. Number of employees......................................................................................................11

1.2.3. Main offices.....................................................................................................................11

1.2.4. Introduction of all positions.............................................................................................11

1.2.5. Comments on organizational structure of Agribank........................................................12

Part 2: Description of the internship

2.1. Overview of TrangAn Branch..............................................................................................13

2.1.1. The establishment of TrangAn Branch............................................................................13

2.1.2. The detailed description of TrangAn Branch..................................................................13

2.2. Internship activities.............................................................................................................14

2.2.1. Training Phase.................................................................................................................14

2.2.2. Internship contents...........................................................................................................14

2.2.3. Internship process............................................................................................................20

2.3. Critical analysis...................................................................................................................21

2.3.1. Strengths..........................................................................................................................21

2.3.2. Weaknesses and main causes...........................................................................................22

Part 3: Solution, Recommendations and Conclusion....................................................................24

3.1. Solutions:.............................................................................................................................24

3.2. Recommendations................................................................................................................26



3.3. Conclusion...........................................................................................................................27

List of Figures

Figure 01: The organization structure of Agribank 10

Figure 02: The size and structure of capital raising 15

Figure 03: Structure of raised funds through the years 16

Figure 04: Resources of mobilization in the period 17

Figure 05: Comparison of mobilized resources 18

Figure 06: Mobilized resources under deposit structure 19



Part 1: Introduction about Agribank

1.1. Overview of Agribank

1.1.1. Brief history

Type State-owned

Industry Banking, Finance,Security

Founded March 26, 1988

Headquarters Ba Dinh District, Hanoi,Vietnam

The bank was founded on March 26, 1988, by the then-Council of Ministers of Vietnam

as a specialized bank aimed at rural and agricultural development as Vietnam Bank for

Agricultural Development (Agribank). The bank built on the agency network of the State

Bank of Vietnam for its branches. On November 14, 1990, it was replaced by the Vietnam

Bank for Agriculture by a prime ministerial decision. On November 15, 1996, it was

renamed again to Vietnam Bank for Agriculture and Rural Development.

Agribank is currently taking the Chairmanship of Asia Pacific Rural and Agricultural

Credit Association (APRACA) in term of 2008-2010, and also a member of International

Agricultural Credit Confederation (CICA) and Asian Bankers Association (ABA).

Agribank has hosted a number of big international conferences, i.e., FAO Conference in

1991, APRACA Meeting in 1996 and 2004, CICA International conference on

agricultural credit in 2001, APRACA Meeting on fishery in 2002.


http://en.wikipedia.org/wiki/State_Bank_of_Vietnam

http://en.wikipedia.org/wiki/State_Bank_of_Vietnam

http://en.wikipedia.org/wiki/Vietnam

http://en.wikipedia.org/wiki/Hanoi

http://en.wikipedia.org/wiki/Ba_Dinh_District

http://en.wikipedia.org/wiki/Security

http://en.wikipedia.org/wiki/Finance

http://en.wikipedia.org/wiki/Banking

http://en.wikipedia.org/wiki/National_bank

http://en.wikipedia.org/wiki/Types_of_business_entity

http://en.wikipedia.org/wiki/File:Agribank_logo.png


1.1.2. Nature of organization

Agribank of The Vietnam Bank for Agriculture and Rural Development is the

largest commercial bank in Vietnam by total assets. It is a state-owned corporation under

a special status. According to a report by the United Nations Development Programme,

Agribank is also the largest corporation in Vietnam.

Apart from business activities, as a big enterprise, Agribank has shown its corporate

social responsibilities towards the nation’s social welfare program.

With the position of a leading commercial bank in Viet Nam, Agribank has shown its

great efforts, reaching encouraging achievements, and contributing greatly to the nation’s

industrialization and modernization as well as economic development.

1.1.3. Business volume

Agribank is the largest bank in Vietnam by most measures: capital, total assets, staff,

operating network, and clients. Its capital as of March 2007 was VND 267.000 billion,

with an equity of VND 15.000 billion and total assets of almost VND 239.000 billion.

The bank operates 2.200 branches nation-wide with 30.000 staff.

In 2010, Agribank’s in Top 10 of 500 largest enterprises in Vietnam.

Main products and services:

- Transaction accounts - Insurance- Stock brokerage- Investment bank- Asset-based lending- Consumer finance- Trade- International payments- Foreign exchange


http://en.wikipedia.org/wiki/Foreign_exchange_market

http://en.wikipedia.org/wiki/Wire_transfer

http://en.wikipedia.org/wiki/Trade

http://en.wikipedia.org/wiki/Consumer_finance

http://en.wikipedia.org/wiki/Asset-based_lending

http://en.wikipedia.org/wiki/Investment_bank

http://en.wikipedia.org/wiki/Brokerage_firm

http://en.wikipedia.org/wiki/Insurance

http://en.wikipedia.org/wiki/Transaction_accounts

http://en.wikipedia.org/wiki/VND

http://en.wikipedia.org/wiki/United_Nations_Development_Programme

http://en.wikipedia.org/wiki/Commercial_bank


1.1.4 Competitors

Agribank’s business fields are getting more and more competitive with the attending of

many banks:

State-owned banks:- Vietnam Bank for Industry and Trade (VietinBank)- Joint Stock Commercial Bank for Foreign Trade of Vietnam- Bank for Investment and Development of Vietnam- Housing Bank of Mekong Delta

Urban Joint-Stock Commercial banks:

- Orient Commercial Joint Stock Bank- Asia Commercial Bank- Hanoi Building Joint-stock Commercial Bank- Maritime Commercial Joint Stock Bank- Sai Gon Thuong Tin Commercial Joint-stock Bank- Eastern Asia Commercial Joint Stock Bank- Vietnam Export – Import Commercial Joint Stock Bank- Nam A Commercial Joint Stock Bank- Saigon bank for Industry & Trade- …

1.2. Organization structure

1.2.1. Organizational chart

Agribank has been operated for a long time; therefore, the company has an effective

structure to manage every single activities. For a more logical and clearer view on

Agribank’s organization structure, please take a look at Figure 1:Ngo Thi Thu Trang 9 ATCA K14

http://en.wikipedia.org/wiki/Asia_Commercial_Bank

http://en.wikipedia.org/wiki/Orient_Commercial_Joint_Stock_Bank

http://en.wikipedia.org/w/index.php?title=Housing_Bank_of_Mekong_Delta&action=edit&redlink=1

http://en.wikipedia.org/wiki/Bank_for_Investment_and_Development_of_Vietnam

http://en.wikipedia.org/w/index.php?title=Joint_Stock_Commercial_Bank_for_Foreign_Trade_of_Vietnam&action=edit&redlink=1

http://en.wikipedia.org/wiki/Vietinbank

http://en.wikipedia.org/wiki/Vietnam_Bank_for_Industry_and_Trade


Figure 01: The organization structure of Agribank

Source: http://www.agribank.com


http://www.agribank.com/


1.2.2. Number of employees

Agribank is the biggest commercial bank in VietNam with an operating network of 2,300

branches and transaction offices nationwide which have been connected online. In 2010,

Agribank has extended the network by opening its first branch in the Kingdom of

Cambodia.

Until 2012, Agribank has over 40,000 employees.

1.2.3. Main offices

Agribank’s Headquarters is in 2 LangHa Street, Ba Dinh District, Hanoi,Vietnam.

1.2.4. Introduction of the main positions

a. Supervisory Board

- Checking the financial activities of the bank.

- Monitoring the observance of the accounting regime and the security of business

operations.

- Implementing of internal audit.

b. Board of Directors

- Daily administrating the bank's operations under theỉ tasks and powers based on

the law and the charter of the bank.

c. Risk Management Commitee

- Identifying and determining the extent of the risks.

- Taking actions to prevent or mitigate the main risks.

- Deploying plans to incident response and handle unexpected hazards which can

occur.

d. Executive Board

- Consisting of the General Director who has the general administration and the

Deputy Directors who assist the General Director.


http://en.wikipedia.org/wiki/Vietnam

http://en.wikipedia.org/wiki/Hanoi

http://en.wikipedia.org/wiki/Ba_Dinh_District


- The Executive Board has the specific function basing on each overall strategy and

the objectives setting by the Board of Directors according business plans.

- Besides, they also advise the Board of Directors on issues of strategy, policy ,

directly operating all bank activities.

e. Functional Departments:

- Advising and implementing the decisions of the board of directors

- Organizing and executing business transactions and banking operations with

criterions such as efficiency, saving, conforming to current regulation.

1.2.5. Comments on organizational structure of Agribank

Agribank has a large scale, but it is still managed successfully and to increase the profit

constantly while many other businesses is going bankrupt because of the economic crisis.

Therefore, in my opinion, the organization structure of Agibank is flexible, suitable and

effective as every activity is under control.



Part 2: Description of the internship

2.1. Overview of TrangAn Branch

2.1.1. The establishment of TrangAn Branch

In accordance with No. 169 / QD-02 dated 07/05/2009, on 15/10/2009 Agribank

LangThuong was upgraded to type I branch (from type II branch) and formally adopt the

decision to rename TrangAn and open a new office at 99 Tran Thai Tong - Cau Giay -

Hanoi.

The branch is considered as one of the branches of the Bank for Agriculture and Rural

Development in Hanoi which implements of the full functions and responsibilities of a

modern and prestigious bank.

The transaction under the branch: No 1, 2, 8, 9, 11, LangThuong, NhanChinh, HangLuoc

Transaction.

In 2012, the branch received West Hanoi branch and some transactions, in spite of

difficulties, it has achieved certain success in stabilizing the organization and business

development.

2.1.2. The detailed description of TrangAn Branch

Bank for Rural Development – TrangAn branch is State-owned and runs as a commercial

bank: an intermediary financial institution to provide payment instruments, intermediate

payments, a foreign currency center, online versatile business communication...

The missions of the branch are exploitation the assigned market area and implementation

of the program of the Vietnam Bank for Agriculture and Rural Development.

The main products and services:

- Mobilizing capital in VND and foreign currencies by using customer deposits.

- Using the capital in Vietnam dong and foreign currencies to supply: short-term

credit; medium - long term credit, consumer lending services, mortgage lending

with valuable documents, trade finance service, investment, capital contribution.



- Intermediary Services: international payments via SWIFT global payments, foreign

exchange and remittance services, implementing underwriting services such as bid

security, payment guarantee and guarantee for work warranty or product quality,

the domestic and foreign loan guarantee..., electronic money transfer.

- Issuing and paying credit cards and debit cards.

2.2. Internship activities

2.2.1. Training Phase

Table: Training timetable

Time Task

02/01 – 02/14 Outlining the internship, understanding the background

theory in capital mobilization.

02/15 – 04/03 Carefully observing training activities of TrangAn Branch.

04/04 - 04/14 Taking part in training courses of the branch.

04/15- 04/29 Accomplishing the internship report and asking for

certification of internship.

2.2.2. Internship contents

As obviously be seen from the above schedule, the major content of my internship was

getting familiar to capital mobilization, one of the most important issues of TrangAn

branch, along with understanding the strategies of capital raising in this branch.

2.2.2.1. Mobilization scale of TrangAn branch:

In the operation of the banks, capital mobilization plays an important role, because it

helps them create essential capital for their activites. It maintains the development of the

bank, decides the bank’s scale. Therefore, Agribank TrangAn branch always puts

considerable efforts into creating an abundant capital, seeking for mobilizing resources to

growing stronger.

Figure 02: The size and structure of capital raising



(Unit: VND)

2011 2012 2013

Mobilized fund 859,385,438,082 1,043,190,182,520 1,995,188,466,301

1. Receiving investments, trusts and loans 3,917,210,561 2,283,182,653 6,039,275,597

1.1. Deposits from financial istitutions 3,278,727,611 1,897,699,703 5,929,792,647

1.2 Loans from domestic financial institutions 638,482,950 385,482,950 109,482,950

2. Total interest-bearing deposits 849,021,194,417 994,534,466,279 1,983,884,498,104

2.1 Domestic interest-bearing deposits 662,681,846,716 718,708,614,918 1,003,754,620,294

2.2 Savings 185,215,036,216 274,481,584,447 978,494,858,509

2.3 CDs and time deposits 1,124,311,485 1,344,266,914 1,635,019,301

3. Issuing valuable paper 2,606,000,000 695,000,000 5,067,392,000

4. Other liabilities 3,841,033,104 45,677,533,588 197,300,600

4.1 Accounts payable liabilities 1,297,412,462 25,605,990,529

4.2 Payable interests and fees 0 19,582,112,690

4.3 Foreign exchange 2,543,620,642 443,515,946 197,300,600

4.4 Unearned revenue 45,914,423

Total capital 872,707,905,655 1,068,840,733,411 1,996,371,175,159

Source: Business statement of Agribank TrangAn 2011-2013

As we can see from the above table, the branch’s capital has continued to grow in the

recent years. In 2013, the branch’s deposits is more than 1,995 billion, accounting for

99.9% of the total capital of the bank, while the figure is 98.5% in 2011. This indicator

shows that the deposits scale of the Bank has been growing and met bank’s demand for

emergency capital. Mobilized capital volume of TrangAn branch also shows a fluctuation

over the years: from 98.5% in 2011 to 97.6% in 2012 and 99.9% in 2013. In this period,



deposits always took a large proportion in total mobilized fund: occupied 97.3% in 2011,

93.0% in 2012 and 99.4% in 2013. Although the growth of deposits in 2012 has

decreased, it is still accounted for large sales assistance in raising capital structure.

2.2.2.2. Structure of mobilization in TrangAn branch:

a. Classification under the economic sectors:

For professional capital raising, the extremely important thing is identifying accurately,

completely capital resources, because it concerns to many factors, such as the content of

the raising capital policies or business plan of the bank. When identifying the source of

capital, the bank will regulate the flow of money reasonably to ensure its liquidity at the

highest level. Capital structure divided by economic sectors of TrangAn branch is shown

in the following table:

Figure 03: Structure of raised funds through the years

39.09%

51.32%

6.08% 3.51%

2011

deposit from resident

deposit from corporation

deposit from other financial institutions

valuable paper

42.37%

47.90%

4.83% 3.90%

2012


51.21%

39.02%

6.85% 2.92%

2013


Holistically, in total bank capital, the mobilized fund from population and economic

entities accounted for the largest proportion, from 70% to 80%. The rest is from financial

institutions and issuing valuable papers.

Therefore, mobilization of TrangAn branch has been formed from many different sources,

and diversified structure in the ongoing growth. It indicates that the branch has suitable

policies and effective measures in its capital raising.

b. Classification under the term of deposit:

Figure 04: Resources of mobilization in the period

(Unit: million VND)

2011 2012 Change 2013 Change

Non-term Deposit 371,751 664,463 +292,711 634,500 -29,963

Short-term deposit 939,161 1,431,150 +491,989 2,079,750 +648,600

Medium and

Long-term deposit

645,673 460,013 -185,661 810,750 +350,738

Total 1,956,586 2,555,625 +599,039 3,525,000 +969,375


The above table shows that short-term capital in TrangAn Branch takes a large proportion

of the total mobilized funds. In 2011, short-term resources in the branch was 1,310,912

million compared with 67% of total deposits. In 2012, this indicator increased 784 700

million in comparison with 2011 and accounted for 82.06% of total deposits. And it

reached 2,714,250 million in 2013.



Figure 05: Comparison of mobilized resources

2011 2012 20130

500000

1000000

1500000

2000000

2500000

371751

664463 634500

939161

1431150

2079750

645673 460013 810750

Year

Non-term deposit

Short-term deposit

Medium and Long term deposit

Billion VND

The chart shows that the medium and long term deposit has a high growth rate over the

years. Although, in this period, the economic situation and foreign political unrest there

has voided significantly affecting the operations of the banks in general, TrangAn branch

with its appropriate policy still has maintained the mobilization as well as medium and

long-term sources.

c. Classification under the deposit structure:

In addition to distinguishing mobilization under different economic sectors and maturity,

the determination of capital raising under the deposit scale is also important. It helps

banks maintain relationships with individuals, businesses and organizations that have

frequent demand of using foreign currency. Raising capital structure under deposit

structure is specified in the following table:



Figure 06: Mobilized resources under deposit structure

Unit: million VND

2011 2012 Change 2013 Change

Local currency 1,308,741 2,218,942 +910,201 2,871,911 +652,969

Foreign currency (in VND) 647,845 336,683 -311,162 653,089 +316,406

Total 1,956,586 2,555,625 +599,039 3,525.,000 +969,375


From the above table, we can see that the local currency volume which the branch

mobilized has been relatively stable and increased steadily over the years. In 2012, it

raised 910 201 million in comparison with 2011 and in 2013, it increased by 625 969

million compared to 2012. Also, with the data of the recent 3 years, it can be said that the

local currency is the main source of the branch’s deposit and the amount of raised capital

is relatively large and takes a very high proportion of total deposits.

That is why the branch needs to invest more to foreign currency mobilization, and build

more specific strategies to satisfy the customer service and increase the amount of foreign

currency.

2.2.2.3. The proportionality between capital raising and use of funds in the

branch:

We can see the relationship between mobilization and use of fund is an organic

relationship, and they are interdependent. Ruggedness and stability of the mobilized funds

resources depend not only on raising funds but also on the use of capital. If the

inadequacy between mobilization and use of capital inadequacy interferes with the

operation of the bank, the bank must change their interest rates. This dynamic could

create uncertainties both in the mobilization and in the use of capital, and hinder for both

customers and the bank.



Therefore, the implementation of the plan to balance business capital, ensure

proportionality between the mobilization and use of capital and ensure the solvency of the

business has always been the question for any bank.

2.2.3. Internship process

My first stage of training was to reinforce my knowledge in capital mobilization as well

as understanding its effects on branch’s profit. From 1st February to 14th February, my task

was reading material about capital raising that the juniors in branch gave and finding

more information about this issue on the internet. This helped me a lot to capture a view

of this topic at the recent stage.

This time period later provided me with a synopsis of the process of strategic planning of

TrangAn Branch. The major activity of mine in this period was to observe and take notes

all about precious experience and practical tips from my supervisor when taking out

capital mobilizing activities. This is a crucial step in my internship when I decided to

choose an activity of all specialize in.

At the next stage, I had an opportunity to apply everything that I had learned to take part

in making a plan for developing with the support of my supervisor. I was asked to make

comments on the plan and give some ideas of coordinating the experienced staff to take

part in real activities of capital raising in the branch. This duty is an opportunity for me to

get nearer to practice and a challenge as well. I had learned many useful things when

practicing thanks to my supervisor’s recommendations.

I spent the two final internship weeks completing my report to submit my supervisor for

improvement in data and reality, the sign of verifying the internship. During the

internship, besides these above work, I helped my supervisor with many other clerical

works such as photocopying, printing and delivering documents.



2.3. Critical analysis

In 2013, Vietnam's economy witnessed a drastic change in the quality of commercial

banks with the powerful growth of profit, scale of capital as well as increased

competition. Agribank TrangAn also reached their development goals:

- For scale of mobilization: TrangAn branch has pursued development goals and

business strategies to expand the scale constantly, and improve business

performance. Thereby, their raising capital volume has increased over the years

and this situation also has created favorable conditions for the implementation of

bank lending activities and its investments. Moreover, the proportion of deposit

being large helps them reduce costs and increase profits.

- Regarding the structure: Like other commercial banks, the main mobilization

source is from short-term deposit, however, this source of the branch does not

fluctuate much. Medium and long-term deposit has been upward, though not

enough to meet the market’s demand, it still has positive changes, indicating the

bank's focus on medium and long-term capital.

2.3.1. Strengths

To achieve the above achievements, the branch has taken advantage of their strengths

cleverly:

- The branch has been constantly growing in both scale and structure, developing a

network-wide mobilization.

- The bank’s brand is prestigious and firm.

- The branch has set out the reasonable objectives, tasks, measures and long-term

strategies for raising capital, added and improved rules in order to promote

individual initiatives.



- In recent years, the bank has implemented a flexible mobilizing policy basing on

the basic analyze, estimated trend, and used regulated floating rate instruments to

attract customers.

- As a part of a state-owned bank, the branch could get the attention and guidance

from the Government as well as other departments.

- For staff, the branch has created an attractive and favorable working enviroment to

attract good employees, encouraged them in studying and improving their

specialist knowledge.

2.3.2. Weaknesses and main causes

a. Weaknesses:

Although TrangAn branch’s profit has went up through the years, this branch still has

drawbacks needing to be tackled:

- Although the deposit scale has increased in recent years, but its growth rate is slow

and not commensurate with the growth rate of long-term credit needs of the

organizations which is increasing due to intensive investment in the economy.

Saving deposit showed an upward trend, but the branch has mainly focused on

products catering for deposits by maturity. This leads to many difficulties in the

diversification of traditional credit products, and spread risks.

- Mobilization of the branch has concentrated mainly in the local currency deposit

while public favor is keeping money in gold or dollar. Therefore, mobilized funds

in the branch has not achieved maximum effect compared to resources.

- Interest costs have accounted a large of proportion but also showed a downward

trend while cost-benefit has increased, resulting in total funding costs of banks at a

high level but do not attract customers.

b. Main causes:

Subjective causes:

- The forms of capital mobilization and the branch’s products is not rich and special

compared with other banks.



- The service has not been diversified and intensively innovated.

- Advertising and marketing activities are not extended.

- The quality of staff still has limitation.

- Technology has not been invested by intensive and comprehensive way.

Objective causes:

- In recent years, the rate of inflation in our country at a high level, the average price

index rose sharply. Gold prices rose sharply, the dollar devaluation. These factors not

only affect economic activities but also impact negatively on activities of bank’s

raising capital.

- Financial market has many fluctuations.

- Investors have been more invested in other sectors which help them earn more profit

such as gold, dollar speculation.

- The branch has to deal with many challenges in competition with both domestic and

foreign banks.

- The population still has ignorance and distrust in banking.

- The spending habit using cash still accounts for a large proportion of the majority

population, leading to restrictions on the expansion of banking services ...



Part 3: Solution, Recommendations and Conclusion

3.1. Solutions:

a. Expanding capital mobilization forms

Firstly, the branch need to extend the forms of deposit: savings, deposits using card,

savings bonuses, accrued savings, and diversified terms of saving deposits. Flexibility on

the duration is an attraction to customers.

Secondly, attracting customers by enlarging services for medium and long – term deposits

such as the owner can flexibly switch when necessary, from which banks can increase the

proportion of medium and long-term funding.

Thirdly, developing the purposeful deposits. The principal clients of this method is

someone earning not high but stable intending to spend in the future, and having needs to

procure valued assets but their savings in a short time cannot satisfy. If the branch catches

the purpose of customer deposits, they can advise customers on time and the specific

payment methods, such as:

- Old-age savings and accrued savings

- Housing Saving

- Savings of expensive equipment procurement

b. Strengthening marketing ad:

The expansion of the bank's activities by active promotion, advertising, propaganda takes

an important part of the branch’s development.

c. Diversifying services, along with raising their quality

The bank's activities are closely linked with each other. Therefore, to strengthen capital

mobilization, the branch should also develop related services. Currently, the payment

deposit is a very attractive market, and if the branch well developed in some ways as

opening a free account for in order to actively reach out to both individual and



corporation, developing payment services in domestic and international cards in order to

meet demand of deposits and withdrawals by clients.

d. Improving the quality of service

- Staff attitude needs to be polite, enthusiastic, friendly.

- Recruitment and training staff in order that they have not only professional expertise

but also plentiful knowledge of many aspects. They also need to be nimble,

resourceful, and can answer the questions expertly and satisfy customers.

- Paying attention to segment of customer care at the transaction counter from drinking

water to defending customer’s vehicles.

- Launching of the emulation movement for workers performing their allocated

business objectives.

- Good performance in working, performing civilized, and clean transactions.

e. Training and improving staff quality regularly

- Supporting staff of the training by opening professional training sources in the

branch.

- Organizing more forms of discussions between Head Office and branches, among

branches in the same locality.

- Implementing flexibility labor plans in order that the branch can ensure human

resources match the requirements of branch operations in each period

- Arming staff with marketing knowledge and reasoning, enabling them to be

important chains in collecting and processing information in time to meet customer’s

demand and enhance communication skills and disseminate of banking products.

f. Innovating technology in raising capital

Banks need to perform simple procedures and shortening time of transaction. The

Headquarter needs to build regulations on the maximum time for each transaction and

deployment to all staff members, basing on ensuring the legality, secure property for the

customer.



3.2. Recommendations

a. For Agribank:

- Assisting the branch subordinates in the mobilization of capital and business

operations, promptly reforming related documents as a legal and professional basis to

expand the products and services.

- Supplementing labor to ensure required staff number to complete the work, limiting

overcrowding, creating opportunity time for staff to study and improve professional

skills.

- Strengthening infrastructure for branch and modernization of equipment in business

operations of the branch.

- Regularly organizing workshops to exchange experiences between the branches,

collecting comments and recommendations of subordinate branches, from which

setting out the suitable regulation basing on the current reality.

- Improving the financial mechanism for the exchange branch members, this is an

important driving force to promote business activities.

b. For The State Bank of Vietnam:

- Expanding foreign relations with foreign financial institutions, enlisting the helpful

and sponsorial funds with low interest rates, extending credit relations, operating

Vietnam dong exchange rate flexibly and consistently with market operation

situation.

- Making healthy the banking system, highlighting the responsibility of banks,

improving management quality and establishing mechanisms to prevent risks,

ensuring the health and safety of the banking system.

- Controlling the commercial bank’s activity frequently and directing the provincial

branch, the city to host the conference among banks in the area to negotiate a

commitment on interest rates mobilizing and lending to each region.



c. For the Government

- Gradually perfecting and reinforcing healthy business environment, building

synchronized law system, ensuring the legitimate rights of investors, businesses and

banks, encouraging people to non-cash payment .

- Paying attention to the interests of the banks and encouraging them to mobilize for

medium and long term funds because they are very important sources, creating

facilities for the industrialization and modernization of the country, considering to

reduce income tax for banks.

3.3. Conclusion

Raising capital is regarded as very important measures serving the cause of

industrialization and modernization, making a decisive contribution to the cause of

national construction. In particular, the scale and structure of capital is the basis for

ensuring safety and profitability target of the bank. Thus, it requires commercial banks in

particular and the banking system in general in our country must constantly innovate to

operate, offer solutions and appropriate measures to promote the idle capital in resident.

Furthermore, the government also need to enforce policies and measures to support the

development activities of the banking system in order to uphold maximum internal force

and contribute to stability and develop the economy, improve people's lives.

Agribank TrangAn, in recent years, has raised a substantial amount of capital with a

reasonable scale and diversity structure and satisfied its capital demand, sponsored for

long term projects which have features as: large-scale, long payback period. However, the

unbalance between the domestic currency and foreign currencies, short-term and long-

term still significantly affect the operations of the branch.



In addition, despite of the fact that there are many competitions as other banks, especially

foreign banks and financial institutions, with a relatively large amount of capital, many

advantages in technology and human resources, Agribank TrangAn branch has constantly

given the strategies to occupy and expand the market. All achievements they reached are

testament to the efforts of all staff here.

After a period of internship, I have gained not only much more practical knowledge in my

major but also precious experience in working in a professional environment.

In term of knowledge, my internship gave me more acquaintance in capital mobilization

of commercial banks. Before the internship, I did not understand all about this field;

however, after that, I can figure out the importance of capital raising and steps to make an

effective plans to improve the bank's capital. Besides, the professional working

environment make me more responsible for things that I have done. Moreover, the

internship helps me to identify my career’s direction. In general, this is an interesting and

important time with practical experience and theory reinforcement.

In conclusion, my internship period is very useful to my study at the university. I have

realized that from the theory to the practice is a long journey which needs great efforts,

experience, and a heart for learning and daring to face difficulties and challenges.



References

1. Annual report of Agribank 2011-2013.

2. Business statement of Agribank TrangAn 2011-2013.

3. The writing of The State Bank of Vietnam No. 169 / QD-02 dated 07/05/2009.

4. Other information in the websites:

http://www.agribanktrangan.com

http://www.agribank.com


http://www.agribank.com/

http://www.agribanktrangan.com/

internship- capital mobilizing in agribank trangan

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