Analysis of capital modification by savings at vietnam prosperity joint stock commercial bank, ham nghi da nang branch, period 2020 2022

DUY TAN UNIVERSITY
INTERNATIONAL SCHOOL
PSU DIVISION

GRADUATION THESIS
ANALYSIS OF CAPITAL MODIFICATION BY SAVINGS AT
VIETNAM PROSPERITY JOINT STOCK COMMERCIAL
BANK, HAM NGHI - DA NANG BRANCH, PERIOD 2020-2022

Lecturer: MSc. Dang Le Vu
Student: Nguyen Thi Minh Lanh
Grade: K25PSU-QNH
Student code: 25202410048
Danang, 2023


DISCLAIMER
I certify that the attached thesis is my original work. No other person’s work
has been used without due acknowledgement. Except where I have l clearly stated
that I have used some of this material, it has not been presented by me for
examination in any other course or subject at this or any other institution.
I understand that the work submitted may be reproduced and/or communicated
for the purpose of detecting plagiarism. I understand that should this declaration be
false, I am libel to be penalized under the Duy Tan University regulations.
Signature: Nguyen Thi Minh Lanh

Date: May 20, 2023


ACKNOWLEDGEMENTS
To complete this report, I would like to express my deep gratitude to Mr. Dang

Le Vu for his enthusiastic guidance throughout the process.
I would also like to thank the leadership and credit department of Vietnam
Prosperity Commercial Joint Stock Bank, Ham Nghi branch, Da Nang city for
creating conditions, guidance and support so that I can complete this report.
Due to limited time and limited understanding, it is difficult to avoid errors in
the process of making this report. Therefore, I look forward to receiving comments
from teachers as well as from the credit department of Vietnam Prosperity Joint
Stock Commercial Bank, Ham Nghi branch.
Da Nang, May 20, 2023
Author
NGUYEN THI MINH LANH


TABLE OF CONTENTS

PREAMBLE............................................................................................................1
1. The urgency of the topic......................................................................................1
2. Research purpose of the topic.............................................................................2
3. Research question................................................................................................2
4. Objects and scope of research............................................................................2
5. Research methods................................................................................................2
6. Theme layout........................................................................................................3
1.1. THEORETICAL BASIS OF CAPITAL MOBILE ACTIVITIES AT
COMMERCIAL BANKS.......................................................................................4
1.1.1. The concept of capital of commercial banks................................................4
1.1.2. Classification of capital sources of commercial banks................................4
1.1.2.1. Equity capital................................................................................................4
1.1.2.2. Additional capital.........................................................................................4
1.1.2.3. Mobilized capital..........................................................................................5
1.1.3. The role of capital mobilization activities of commercial banks................5

1.1.3.1. For the bank.................................................................................................5
1.1.3.2. For customers...............................................................................................6
1.1.3.3 For the economy............................................................................................6
1.1.4. Types of capital mobilization of commercial banks....................................7
1.2. THEORETICAL BASIS ON CAPITAL MOBILE ACTIVITIES IN THE
FORM OF SAVINGS AT COMMERCIAL BANKS...........................................7
1.2.1. The concept of capital mobilization in the form of savings........................7
1.2.2. Features of mobilizing capital by saving deposits.......................................7
1.2.3. Principles of raising capital by savings deposits..........................................9
1.2.4. Savings deposit classification......................................................................10
1.2.4.1. Classification by form of interest payment..................................................10
1.2.4.2. Categorize by customer..............................................................................10
1.2.4.3. Sort by deposit method................................................................................10
1.2.4.4. Sort by product group.................................................................................11


1.3. INDICATORS FOR ASSESSMENT OF DEPOSIT ACTIVITIES AT
COMMERCIAL BANK........................................................................................11
1.3.1. Savings deposit growth rate........................................................................11
1.3.2. Savings deposit mobilization structure......................................................13
1.4. FACTORS AFFECTING DEPOSIT ACTIVITIES AT COMMERCIAL
BANK.....................................................................................................................14
1.4.1. Subjective factors.........................................................................................14
1.4.2. Objective factors..........................................................................................16
CONCLUSION CHAPTER 1...............................................................................19
CHAPTER 2: THE SITUATION OF CAPITAL MODIFICATION IN THE
FORM OF SAVINGS AT VIETNAM PROSPERITY BANK, HAM NGHI
BRANCH IN THE PERIOD OF 2020-2022........................................................20
2.1. OVERVIEW OF VIETNAM PROSPERITY BANK, HAM NGHI
BRANCH...............................................................................................................20

2.1.1. Overview of the bank...................................................................................20
2.1.2. The process of formation and development...............................................20
2.1.3. Organizational structure.............................................................................22
2.1.4. Functions of departments............................................................................23
2.1.5. Business performance of VPBank Ham Nghi in the period of 2020-2022
................................................................................................................................. 24
2.1.5.1. The situation of capital mobilization of VPBank Ham Nghi in the period of
2020-2022...............................................................................................................24
2.1.5.2. Loan situation of VPBank Ham Nghi in the period of 2020-2022..............28
2.1.5.3. Business results of VPBank Ham Nghi in the period of 2020-2022............31
2.2. THE SITUATION OF CAPITAL MOBILIZATION IN FORM OF
SAVINGS AT VIETNAM PROPERTY BANK, HAM NGHI BRANCH IN
THE PERIOD OF 2020-2022...............................................................................35
2.2.1. Savings deposit products at VPBank Ham Nghi.......................................35
2.2.2. Operation process of savings deposit mobilization...................................35
2.2.2.1. The process of direct deposit at the branch................................................36


2.2.2.2. Online savings deposit process...................................................................36
2.2.3. The situation of capital mobilization by savings deposits at VPBank Ham
Nghi in the period of 2020-2022............................................................................37
2.2.3.1. Overview of deposit account mobilization at VPBank Ham Nghi in the
period of 2020-2022................................................................................................37
2.2.3.2. Analysis of the current situation of deposit account mobilization in the form
of interest payment..................................................................................................40
2.2.3.3. Analysis of the current situation of savings deposit account mobilization by
customers................................................................................................................. 44
2.2.3.4. Analysis of the current situation of depositing deposit accounts by deposit
method.....................................................................................................................47
2.2.3.5. Analyze the current situation of deposit account mobilization by product

group.......................................................................................................................50
2.3. ASSESSMENT OF THE EFFICIENCY OF CAPITAL MOBILE
ACTIVITIES WITH SAVINGS AT THE VIETNAM PROSPERITY BANK,
HAM NGHI BRANCH.........................................................................................54
2.3.1. Results..........................................................................................................54
2.3.2. Advantage and disadvantage......................................................................55
3.1 ORIENTATION OF THE BRANCH............................................................59
3.1.1. General direction.........................................................................................59
3.1.2. Orientation of deposit mobilization activities............................................60
3.2. SOME SOLUTIONS FOR DEVELOPING SAVINGS DEPOSIT AT THE
BRANCH...............................................................................................................61
3.2.1. Promote exploitation of potential customers.............................................62
3.2.2. Developing a diversified and comprehensive system of products and
services...................................................................................................................63
3.2.3. Strengthen marketing activities, promote brand image...........................64
3.2.4. Improve the quality of staff.........................................................................66
3.2.5. Improve service quality, enhance customer experience............................67


3.3. SOME RECOMMENDATIONS TO VIETNAM PROSPERITY JOINT
STOCK COMMERCIAL BANK, HAM NGHI BRANCH................................68
CONCLUSION......................................................................................................72


LIST OF TABLES

Number
2.1

Table name

The capital mobilization situation of VPBank

Page
24

2.2

Ham Nghi in the period of 2020-2022
Loan situation of VPBank Ham Nghi in the

28

2.3

period of 2020-2022
Business results of VPBank Ham Nghi in the

31

2.4

period of 2020-2022
The situation of depositing deposit accounts of

37

2.5

VPBank Ham Nghi in the period of 2020-2022
The situation of depositing savings accounts in

40

the form of interest payment of VPBank Ham
2.6

Nghi in the period of 2020-2022
The situation of depositing savings accounts by

44

customers of VPBank Ham Nghi in the period of
2.7

2020-2022
The situation of depositing savings accounts by

47

deposit method of VPBank Ham Nghi in the
2.8

period of 2020-2022
The situation of depositing savings accounts by
product group of VPBank Ham Nghi in the
period of 2020-2022

50

LIST OF FIGURES

Number
2.1
2.2

Names of graphs, figures, diagrams
Organizational structure at VPBank Ham Nghi
The situation of capital mobilization of VPBank Ham

Page
21
24

2.3

Nghi in the period of 2020-2022
Loan situation of VPBank Ham Nghi in the period of

28

2.4

2020-2022
Business results of VPBank Ham Nghi in the period of

31

2.5
2.6

2.7

2020-2022
The process of opening a savings book at the counter
The process of opening an online savings book
The situation of depositing deposit accounts of VPBank

35
35
37

2.8

Ham Nghi in the period of 2020-2022
The situation of depositing savings accounts in the form

40

of interest payment of VPBank Ham Nghi in the period
2.9

of 2020-2022
The situation of depositing savings accounts by

44

customers of VPBank Ham Nghi in the period of 20202.10

2022
The situation of depositing savings accounts by deposit

47

method of VPBank Ham Nghi in the period of 20202.11

2022
The situation of depositing savings accounts by product
group of VPBank Ham Nghi in the period of 2020-2022

50


1

PREAMBLE
1. The urgency of the topic
In recent years, the world and domestic economic situation have experienced
many fluctuations, especially in the financial and monetary markets. As a young
and vulnerable economy, our country is still facing many difficulties due to the
negative impact of the Covid-19 pandemic and the influence of world economic and
political events. However, there are still positive signs. In that situation, the
activities of organizations in the financial sector as well as the system of
commercial banks have shown their importance.
In order for the economy to operate continuously and develop sustainably,
capital is an urgent issue and should be given top priority. Capital source and access
to capital is one of the decisive factors for the success or failure of businesses. For
commercial banks - a special form of enterprise, financial intermediaries providing
capital for the activities of other enterprises in the entire economy - capital sources
and capital mobilization play an even more important role. most important. Banks
must always focus on capital growth through mobilizing activities to ensure their

reputation and demonstrate their capacity.
Recently, the events and bad news of the bond and deposit markets have partly
affected people's psychology and disturbed the capital mobilization activities of
banks in general and money mobilization. send in particular. Although Vietnam
Prosperity Joint Stock Commercial Bank, Ham Nghi - Da Nang branch has always
performed well, it still has to bear unavoidable systemic risks affecting the branch's
operations.
After a period of practical experience and research on capital mobilization at
VPBank Ham Nghi, I realized that it is important to learn, analyze and evaluate
capital mobilization by the form of savings for the development of the bank. With
the desire to improve and enhance the efficiency of deposit mobilization of VPBank
Ham Nghi, as well as domestic commercial banks, I would like to choose the topic:
"Analysis of capital mobilization by savings Vietnam Prosperity Joint Stock


2

Commercial Bank, Ham Nghi - Da Nang branch, period 2020-2022" doing the
graduation thesis.
2. Research purpose of the topic
- To study the basic issues of capital mobilization activities in the form of
savings deposits of commercial banks.
- Analyze and evaluate capital mobilization activities in the form of savings at
VPBank Ham Nghi.
- Proposing solutions to develop savings deposit mobilization activities.
3. Research question
To achieve the goal, the author conducted research to answer the following
questions:
- What is the activity of mobilizing capital by savings deposits at commercial
banks? What are the contents of deposit mobilization activities? What factors affect

mobilizing activities?
- How is the situation of deposit mobilization at VPBank Ham Nghi branch?
- What solutions can help banks develop capital mobilization activities in the
form of savings?
4. Objects and scope of research
- Research object: Capital mobilization activities in the form of savings
deposits at commercial banks.
- Scope of the research: Fundraising activities in the form of savings at
VPBank Ham Nghi branch.
- Research period: 2020-2022
5. Research methods
- The thesis uses the methods of analysis - synthesis, comparison-contrast, and
evaluation through the information and data collected.
- During the research process, the thesis collects information and data from
reports and data at Vietnam Prosperity Bank, Ham Nghi branch, reference
textbooks, theses, internet...
6. Theme layout


3

In addition to the Introduction and Conclusion, the main content of the thesis
is presented in three chapters:
- Chapter 1: Theoretical basis of capital mobilization in the form of savings at
commercial banks.
- Chapter 2: The situation of capital mobilization in the form of savings at
Vietnam Prosperity Bank, Ham Nghi branch in the period of 2020-2022.
- Chapter 3: Proposing solutions to develop capital mobilization activities in
the form of savings at Vietnam Prosperity Bank, Ham Nghi branch.

4

CHAPTER 1: THEORETICAL BASIS OF CAPITAL

MOBILIZATION IN THE FORM OF SAVINGS AT COMMERCIAL
BANKS
1.1. THEORETICAL BASIS OF CAPITAL MOBILE ACTIVITIES AT
COMMERCIAL BANKS
1.1.1. The concept of capital of commercial banks
“The capital source of commercial banks is all monetary means in society that
the bank can mobilize, use to lend and perform other business services of the bank.”
(MSc. Le Thi Hoai Trinh (2022), Commercial banking operations)
It can be understood that the capital source of a commercial bank is formed by
the monetary source from the bank itself and other individuals and organizations
with idle money. From there, the bank carries out its business activities on the basis
of the capital it has acquired (credit, investment...), creating the circulation of
money in the economy.
1.1.2. Classification of capital sources of commercial banks
The capital sources of commercial banks can be divided into 3 types:
1.1.2.1. Equity capital
A bank's equity capital is the actual value of its charter capital and reserve
funds and some other debit assets. In other words, equity is a self-owned resource
that the bank owns and will be used for business purposes.
Own capital includes:
- Tier 1 capital: charter capital, reserve fund for supplementing charter capital,
investment and professional development fund, retained earnings, share capital
surplus.
- Tier 2 capital: the added value of fixed assets and revalued investment
securities, financial reserve fund, general provision, convertible secondary debt.

1.1.2.2. Additional capital
Additional capital is a source of capital formed through entrusting agents to
domestic and foreign organizations or can attract capital through the payment means
adopted by the bank.


5

Additional capital includes:
- Capital in payment
- Trust capital
1.1.2.3. Mobilized capital
Mobilized capital is the monetary value that the bank obtains through the
operation of raising capital from individuals and economic organizations in the
economy by providing its products and services, and at the same time using it. use it
as a basis for other business activities. Mobilized capital is the largest source of
capital in the total business capital of commercial banks.
Raised capital includes:
- Deposit capital
- Capital to issue valuable papers
- Loans
1.1.3. The role of capital mobilization activities of commercial banks
1.1.3.1. For the bank
- Capital is the basis for the bank to organize all business activities:
A commercial bank is an enterprise dealing in commodities, especially
currency. Therefore, it is both a means and a main business object. Capital is the
starting point in the business cycle, so it is necessary to take care of the growth of
capital during the operation of the bank.
- Capital determines the business scale of the bank:
The capital source determines the expansion or contraction of the bank's

business activities. Banks with large capital often provide credit and investment
product portfolios with a more diversified structure and larger scale than banks with
small capital sources. Large capital can help banks meet their loan needs, increase
solvency and diversify services to customers.
- Capital determines the solvency capacity and ensures the reputation of the
bank:
Reputation is a decisive factor to the survival, brand and development of the
bank's operations. The larger the mobilized capital, the higher the customer's


6

confidence in the bank. The bank's reputation is reflected in its ability to pay
customers, its high solvency shows that the bank has a large available capital. With
high capital mobilization capacity, the bank can expand its business activities and
affirm its position.
- Capital determines the bank's competitiveness:
Large capital creates favorable conditions for the bank to expand its credit
relationship with customers in terms of size, volume, term and interest rate. With
strong financial capacity, the bank can operate in a versatile way, disperse risks and
strengthen its competitive strength in the financial market.
1.1.3.2. For customers
- The customer is the person who directly opens a savings account at the bank.
In addition to enjoying interest rates to ensure profitability, customers are also
assured of the safety of idle capital. In other words, saving is a profitable investment
with an extremely low level of risk. When customers open a savings account at the
bank, they will be committed to keeping information confidential from the bank.
Besides, the bank is obliged to refund the full amount whenever the customer
requests it.
- When depositing savings, customers can enjoy accompanying services

depending on deposit packages, amount, deposit term and policies of each bank.
1.1.3.3 For the economy
- Capital mobilization is the premise for the bank to perform the credit
intermediary function, provide timely and meet the capital needs for life and
business activities of all other individuals and organizations in the economy.
Therefore, it is possible to partly reduce the risks that hinder socio-economic
development.
- Exploiting and taking advantage of idle capital in the economy, promoting
capital rotation, and at the same time solving money stagnation and capital deficit in
society. Since then, capital mobilization contributes to promoting economic growth
and ensuring social security for the country.
- Along with the economic development and commercial banking system, with


7

a diversified product and service portfolio to meet the specific needs of each
customer, making payment easy and convenient. than. In addition, the more capital
mobilized into the banking system, the less free money in the economy. That makes
the management of the State easier and more convenient in making appropriate
policies.
1.1.4. Types of capital mobilization of commercial banks
- Receiving deposits: deposits from individuals, economic organizations and
other entities in the economy (payment deposits, savings deposits, margin
deposits...)
- Issuing valuable papers: short-term valuable papers (proposals, bills, shortterm certificates of deposit...), medium and long-term (proposals, bonds, stocks)
- Borrowing capital: loans from the State Bank, commercial banks and other
credit institutions, loans from the capital market and from other sources (trust
sources, payment sources...)
1.2. THEORETICAL BASIS ON CAPITAL MOBILE ACTIVITIES IN

THE FORM OF SAVINGS AT COMMERCIAL BANKS
1.2.1. The concept of capital mobilization in the form of savings
- The activity of raising capital in the form of savings deposit of a bank is
understood as the activity of receiving deposits from the population through the
form of savings and ensuring the full repayment of principal and interest as agreed
upon to customers upon arrival term.
- Savings deposit is money that customers deposit into a savings account at a
bank for the purpose of accumulation, profit and safety.
- Savings deposit includes short-term, medium- and long-term savings
deposits
1.2.2. Features of mobilizing capital by saving deposits
- Savings deposits are an important source of capital of commercial banks,
accounting for a high proportion in the total capital structure:
Stemming from the desire of people with idle money in society, most people
want to ensure the safety of their property and earn a profit even when not in use.


8

The form of savings deposit is a product that is highly suitable for the above needs.
Therefore, the capital mobilized from savings deposits is very large and accounts
for a large part of the total mobilized capital although the number of customers is
not much.
- Most savings deposits from residents have short term:
Term savings deposits are deposited in banks usually with a term of 1 year.
Stemming from the psychology of preventing unstable financial situation of each
customer and wanting to choose a short-term savings package with the highest
interest rate. Along with that, the difference in interest rates on the interest rate table
of 1-year and over 1-year savings deposits of banks is usually not large. Although
most savings deposits are short-term, most customers often withdraw interest when

due and send back the principal amount or combine both principal and interest to
start a new term. Therefore, savings deposits will still maintain stability in the
bank's mobilized capital.
- As a highly stable source of capital:
Customers deposit savings at the bank as a profitable investment channel
through earning interest from the deposited amount. If there are no unusual events,
the customer will not request a withdrawal before the maturity date. The amount in
the savings account will not change during the period and will be used for my
business activities
- As a source of capital that is very sensitive to interest rates:
Because the main purpose of saving money is to earn profit, the interest rate is
the main factor that directly affects people's decision to deposit money. Regardless
of other factors, banks with higher deposit rates will be given priority. Therefore, it
can be said that savings deposit channel is a capital mobilization channel with high
sensitivity to interest rates. In order to mobilize large capital sources, banks must
offer attractive interest rates to attract customers, and at the same time must make a
reasonable balance between deposit interest rate and lending interest rate so as not
to affect profit and loss. bank growth.
In fact, besides interest rates, capital mobilized from savings deposits is also


9

affected by many factors such as bank's reputation, brand coverage...
- The cost of mobilizing large savings deposits:
Because it is more stable and less volatile than current deposit, the cost of
management and service provision of savings deposit is low. However, having to
pay a high deposit interest rate leads to high interest expense on mobilized capital.
Besides, the non-interest expenses associated with savings deposits (insurance, gifts
for customers, salary and bonus for employees...) also make the total cost of saving

deposits much higher. other forms of mobilization.
- As a passive source of capital, affected by the income and spending habits of
customers:
The essence of savings deposit mobilization is to take advantage of the idle
money in the population. Therefore, in this case, the commercial bank is a passive
organization and the capital source depends on the financial situation as well as the
habits of the population. The higher the customer's income source, the more safetyoriented mentality, the larger the savings deposit and vice versa. In addition, when
the economy is unstable and other investment channels become risky, people will
switch to more bank savings options.
- Diversified and flexible deposit terms:
In order to meet the different needs of each customer flexibly, the bank offers
more and more diverse savings deposit packages with deposit terms: 1 month, 3
months, 6 months, 12 months...
1.2.3. Principles of raising capital by savings deposits
- Principle 1: Capital mobilization must be based on loan demand. The bank
must calculate the demand for spicy to determine the amount of capital to mobilize.
To ensure a balance between mobilized capital and capital use in order to improve
the bank's operational efficiency.
- Principle 2: The bank receiving the customer's deposit must be responsible
for repaying in full and on time both principal and interest according to the previous
agreement between the bank and the customer.
1.2.4. Savings deposit classification


10

1.2.4.1. Classification by form of interest payment
- Prepaid interest savings deposit:
It is a term savings account whereby customers who deposit money into a
savings account will receive interest right from the beginning of the deposit term.

The principal amount will be refunded by the bank at the end of the deposit term.
- Postpaid interest savings:
It is a savings deposit that customers receive the principal and interest at the
time of maturity at the end of the period.
- Savings deposit with periodic interest payment:
It is a savings deposit where customers receive interest according to a
previously agreed upon term with the bank, usually monthly, quarterly or annually.
The principal amount will be refunded by the bank at the end of the deposit term.
1.2.4.2. Categorize by customer
- Savings deposits from residents:
A savings deposit that a commercial bank has mobilized from individuals with
idle capital available in the society in various forms with a commitment to ensure
safety of money source and fully repay the principal and interest on time.
- Savings deposit from businesses:
It is a savings deposit that a bank receives from organizations and businesses
in the economy that have temporarily idle cash sources and do not need to be used
for business activities, for the purpose of earning profit for a period of time certain.
1.2.4.3. Sort by deposit method
- Deposit savings directly at the counter:
A savings deposit whereby customers go directly to a bank's branches or
transaction offices and ask employees to open a savings account. Through direct
deposit, customers need to present documents and provide all the information
required by the teller when opening and withdrawing savings.
- Send savings online:
A savings deposit whereby customers only need to deposit money and
complete related procedures through the internet banking application provided by


11

the bank. Through online deposit, customers do not need to go to the bank's
branches or transaction offices, however, customers are required to have an internet
banking account before opening an online passbook.
1.2.4.4. Sort by product group
- Group of Savings in installments products:
This is a savings deposit that the bank can mobilize through the provision of
products suitable to the segment of customers who have idle money to spend in
small amounts in stages and have long-term financial accumulation needs.
- Group of High interest rate products:
A savings deposit that a bank can raise through the provision of savings
products suitable to the segment of customers who have a fixed amount of idle
money for a certain period of time and expect to enjoy the highest interest rates on
deposit amount.
- Group of Flexible withdrawals products:
A deposit that a bank can raise through the provision of savings products
suitable to the customer segment that wants to preserve the benefits of interest as
well as is afraid of the risk of interest rate fluctuations as well as the amount of
money they receive interest received from time to time.
- Group of Interest in advance products:
A deposit that a bank can raise through the provision of savings products
suitable to the segment of customers who have idle money but want to receive
interest in advance to serve spending.
1.3. INDICATORS FOR ASSESSMENT OF DEPOSIT ACTIVITIES AT
COMMERCIAL BANK
1.3.1. Savings deposit growth rate
Growth rate (difference) of savings deposits: is the change in both the value
and rate of savings deposits that commercial banks mobilize over time.
- The first issue that is considered when considering the results of savings
deposit mobilization of a commercial bank is the size of capital, or the size of the
amount of deposit accounts that the bank has mobilized.