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BUSINESS PLAN
YEAR 2019
Ho Chi Minh City,04/2019
2
Content
DETAILED REPORT
A. MARKET OUTLOOK ................................................................................................... 5
B. PROPOSAL STRATEGIES FOR 2019 ........................................................................ 8
I. FINANCIAL TARGET: ................................................................................................. 8
II. CUSTOMER & EXTERNAL ACTIVITIES ............................................................... 9
1. Consumer banking ....................................................................................................... 9
2. Large corporate banking .......................................................................................... 10
3. SME ............................................................................................................................. 11
4. Interbank investment activities ................................................................................ 12
5. Network development and marketing activities ..................................................... 13
III. OPERATION AND ORGANIZATION ..................................................................... 14
1. Credit management ................................................................................................... 14
2. Risk management ....................................................................................................... 15
3. Banking techonology management .......................................................................... 17
4. Operation management and customer service ........................................................ 18
5. Anti - Money Laundering ......................................................................................... 19
6. Progress of 5 strategic goals and strategic intiatives .............................................. 20
7. Service customer management ................................................................................. 20
8. Internal audit ............................................................................................................. 21
9. Legal & Compliance .................................................................................................. 22
IV. HUMAN RESOURCE TRAINING AND DEVELOPMENT .................................. 23
1. Orientation for 2019 .................................................................................................. 23
2. Solution ..................................................................................................................... 23
3
EXECUTIVE SUMMARY
I. The strategic objectives for the year 2019
- Continue ABBANK's vision and strategic directions until 2020:
Focus on retail banking.
Increase the proportion of service income in income structure, including income from
traditional banking services and other services such as asset valuation, insurance
consultancy and cooperation.
Improve ROE ratio to catch up with Top 5 private joint stock banks.
Build a friendly and professional working culture.
Modern corporate governance according to international standards: Through the
implementation of the second phase of the project "Improving organizational and
operational efficiency of ABBANK"
- Maintain the credit rating (a high rating in banking market)
- Enhance ABBANK's brand position in the market
- Pay attention to the development of Digital banking to create the foundation for the
breakthrough of competitive products in the retail segment and improve risk and
technology management.
- Improve operational efficiency and optimize the utilization of equity and create a
sustainable premise for growth in the long run.
With these strategic orientations, the entire bank will continue to focus resources on three
aspects: (i) customer - external relations, (ii) operation - organization and (iii) learning and
development in 2018 to achieve financial goals.
(1) Customer - external activities include: customer banking, cooperate banking,
interbank and marketing & network development.
(2) Operation - organization include: Credit management, debt workout, risk
management, operation management, quality management and information
technology management, internal audit and legal & compliance.
(3) Learning and human resource development
4
II. Summary of 2019’ financial criterias
Unit: bil dong
+/- %
Total assets 105,720 90,237 15,482 17%
Total loans 63,030 57,325 5,705 10%
- Loan to customers 61,323 52,465 8,859 17%
- Corporate bonds 1,707 4,860 (3,153) -65%
Total deposits 86,119 67,972 18,147 27%
- Deposits from customers 82,609 64,490 18,119 28%- Funds from International FIs 3,510 3,482 29 1%
Total operating income 4,053.3 2,902.2 1,151.1 40%
Operating expense 2,188.6 1,687.0 501.5 30%
Operating profits before provisions 1,864.8 1,215.2 649.6 53%
Total credit risk provision 644.8 314.5 330.3 105%
Profit before taxes 1,220.0 900.8 319.3 35%
ItemBudget of
2019
Actual of
2018
Vs actual of 2018
III. Summary of 2019’ key financial ratios
Return on Equity (ROE) 15.7% 13.9% %/year
Return on Asset (ROA) 1.2% 1.1% %/year
Profit before taxes / Net revenue 30.1% 31.0% %
Cost income ratio (CIR) 54.0% 58.0% %
Capital Adequacy Ratio (CAR) >=9% 12.1% %
Asset Equity Ratio (A/E) 11.9 13.2 Times
Debt Equity Ratio (D/E) 10.9 12.2 Times
Equity Asset Ratio (E/A) 8.4% 7.6% %
Debt Asset Ratio (D/A) 91.6% 92.4% %
Loan Asset Ratio (LAR-Credit risk factor) 58.0% 58.1% %
Loan Deposit Ratio (LDR) (1st market) 74.2% 81.4% %
Profit before taxes / staff 259 234 Mil dong/year
Operating expense / staff 464 433 Mil dong/year
ItemBudget of
2019
Actual of
2018Unit
Detail of the 2019 business plan is specified in the attached file.
Respectfully,
An Binh Commercial Joint Stock Bank
Chief Executive Officer
Pham Duy Hieu
5
A. MARKET OUTLOOK
Vietnam economy
According to the Governor of the State Bank, in 2019, the State Bank continue to execute a
flexible and stable exchange rate to ensure market confidence; pay attention to the quality and
efficiency of supervision inspection, especially remote supervision with credit institutions;
consistently managing monetary policy to stabilize the macro-economy, control inflation.
Also, according to the State Bank, the currency rates and foreign exchange markets are stable
and synchronous. Authorities continued to buy foreign currencies to increase national foreign-
exchange reserves, resulting in the stability in the currency rates, foreign exchange markets
and ensured liquidity
The interest rate level remained stable in the context of an increase in international market
interest rates; lending rates of around 6-9% for short and medium terms and about 9-11% for
long terms. Credit structure continued to experience the positive adjustments, that mostly
focused on manufacturing, business, priority areas; credit of the high risk sectors controlled
at a reasonable level
Credit growth: in the 3rd quarter of 2018, the Governor of the SBV issued Directive No. 04
to tighten credit in risky areas such as real estate or BOT, and focus on manufacturing areas.
This credit tightening action was to restrain the overheating growth in the areas such as real
estate as well as to control inflation
Credit growth in 2018 decelerated and be likely to have the downward trend in 2019 but credit
growth was more substantial. Credit structures continue to a positive shift with a focus on
production and business, especially in priority areas, major and key projects according to the
Government's guidelines. Credit demand is expected to slow down due to the impact of
slowing economic growth and the possibility of a slight increase in interest rates in 2019.
Credit supply would be also under pressure when the risk factor in real estate loans increased
to 250% and the ratio of short-term capital for medium and long-term loans was reduced to
40% in 2019.
At the conference of implementing banking tasks in 2019, on the morning of September 9,
2019, the Governor of the State Bank Le Minh Hung said that in 2019, the credit growth rate
will be around 14% (in 2018 also 14 %). However, the management of credit growth with
banks and credit institutions will be different. Organizations which are accredited with Basel
II by the State Bank with safe and healthy operation will be given higher credit growth
although overall credit growth is still at 14%
Banking sector
Thanks to positive macro policies, banking industry is expected to be safer and healthier.
Although credit growth is forecasted to keep tighter control in 2019, credit performance is
expected to continue to be boosted thanks to lower provision expenses in the coming time.
However, total income will be reduced due to the absence of abnormal revenues from
investment securities, from bancassurance and revenues from handling bad debts.
6
Besides, the pressure of raising capital is significant, because of the capital adequacy ratio
(CAR) of banks, especially for state-owned banks that have approached 9% and if applying
Basel II standards, CAR will drop below 8%. The target set by the Government for joint stock
banks by the end of 2020 basically has the level of equity in accordance with Basel II
standards, in which at least 12 - 15 banks have successfully applied standard Basel II. By the
end of 2025, all banks apply standard Basel II, piloting the application of advanced Basel II
at state-owned commercial banks and joint-stock banks with good governance
Development trend
Financial and banking sector have been witnessing the strong impacts of The Industrial
Revolution 4.0. The key word “ Fintech” is becoming new force in financial sector, holding
the world’ cash flow. In the banking sector, the 'game' became increasingly crowded with
Timo, MoMo, MoCa, TPBank LiveBank, or OCB OMNI, in 2018 as many statements about
the digital banking revolution of banks VPBank or VIB … The list of digital banking in
Vietnam promises a big change, but most of this revolution has not yielded significant results.
The 4.0 revolution has put all commercial banks on the starting line for a new race and will
bring many new experiences to consumers.
Access to bank loans by individual and small and medium-sized businesses still faces many
barriers that lead to lucrative markets for new financial services, using a spearhead technology
platform to attack. According to International Financial Corporation (IFC), the "investment
capital gap" for SMEs lending only in emerging markets is USD 2000 bil. This iss due to the
complicated but poorly scaled process of the traditional financial model, for example, a bank
lends a small loan to a small business, but also needs a heavy amount of resources and
personnel. In addition, FinTech - a combination of finance and technology - has defined
difficulties in financial management and loan operations, which is defined as the application
of technology and innovative business models. into financial services - has become a strong
trend. Because Fintech solutions operate very efficiently and optimally for small-scale
institutions, personal consumption and SMEs are the main beneficiaries (according to
McKinsey studying 62% of FinTech startups aiming to the bank's retail service segment,
while only 11% focusing on large customer loans)
The true innovation, transformation is entirely possible only from the Open Innovation model,
taking advantage of many different elements, through a specially designed operational
program on the sharing culture of cooperation, for financial experts, technology engineers,
sales masters, macroeconomic experts, high-ranking bank leaders... to share, discuss and
criticize to come up with breakthrough solutions, the premise for financial technology
products that can really change user behavior and dominate the market. Many banks in the
world and in Vietnam also understand and choose this theory to develop the Digital Bank -
Creative Bank strategy. The strategy chosen is usually to build a Hub - a research room (Lab)
- an incubator (accelerator) program with the expectation of finding many new solutions for
the bank itself and better exploit customer capital - information that banks own. Training
programs on industry knowledge are opened, advisors who are management personnel from
banks will also be present to comment, and accompanying startups, investment departments
7
and investment fund partners will also attend presentations to select projects for investment.
However, this strategy is often limited by the number of accessible startups, the scalability of
the central operating personnel, the size of the center's infrastructure, and the bank's internal
processing process when making decisions to invest in new products, or apply new products
to the bank's distribution channel.
8
B. PROPOSAL STRATEGIES FOR 2019 I. FINANCIAL TARGET:
1. ABBANK’ business performance targets in 2019
Unit: bil dong
+/- %
105,720 90,237 15,482 17%Loan 63,030 57,325 5,705 10%
Retail 25,926 22,507 3,420 15%
SME 15,568 9,826 5,742 58%
Corporate 21,386 24,150 (2,765) -11%
Treasury 150 843 (693) -82%
Deposit 86,119 67,972 18,147 27%
Retail 37,583 30,696 6,887 22%
SMEs 6,623 3,681 2,942 80%
Corporate 41,913 33,595 8,319 25%
In which: IFC+ ADB 3,510 3,482 29 1%
Government Bonds 14,000 13,380 620 5%
Credit institutions Bonds 1,700 1,462 238 16%
Economic Orgnizations Bonds 3,028 7,247 (4,219) -58%
Shares - 2 (2) -100%
Long-term Investment 444 529 (85) -16%
Total of investment 19,172 22,619 (3,448) -15%
Net interest income 3,114.3 1,995.6 1,118.7 56%
Income from services 469.3 337.0 132.3 39%
Other income 469.7 569.7 (99.9) -18%
Total income 4,053.3 2,902.2 1,151.1 40%
Operating Expense 2,188.6 1,687.0 501.5 30%
Earning before Credit Provision
Expense 1,864.8 1,215.2 649.6 53%
Total provision expense 644.8 314.5 330.3 105%
EBT 1,220.0 900.8 319.3 35%
Deposit
Investment
Business
Result
ActualBudget of
2019
Actual of
2018
Vs actual of 2018
Total loan
Total asset
Total assets in 2019 is planned to increase by VND 15,482 bil ( equivalent to 17%) in
comparison with that in 2018 with the expectations of the increase in loans from 2 markets,
corresponding with the increase in deposits from customers and interbank market.
Profit analysis
The planned EBT would be VND 1,220 bil, increases by VND 319.3 bil ( equivalent to
35%) in comparison with that in 2018. In which:
- Total income increases by VND 1,151.1 bil ( equivalent to 40%), including:
+ Net interest income increases by VND 1,118.7 bil ( equivalent to 56%)
9
+ Net service income increases by VND 132.3 bil ( equivalent to 39%)
+ Other incomes decrease by VND 99.9 bil ( equivalent to 18%)
- Operating expenses increase by VND 501.5 bil, increase by 30% in comparison with
those in 2018. In which: mainly due to an increase in expenses for staff to meet the
demand on scale development and an increase in expenses for assets stemming from
huge investment on technology in 2019...Other expenses would be controlled
effectively
- Total provisions for credit risk and VAMC bond in 2019 are about VND 644.8 bil,
there is nearly VND 330.3 bil higher than those in 2018
Overall, the planned EBT in 2019 is expected to show high growth rate with EBT of
VND 1,220 bil
2. Debt settlement plan for 2019
- ABBANK would collect/ handle VND 816.9 bil and control official NPL under 3%
of total outstanding loans in compliance with the SBV’ requirement
- Centrally train and guide professional skills related to debt workout for staff in
Workout unit and business units
- Take advantage of Resolution 42/2017 to improve results of debt settlement and asset
seizure
Unit: bil dong
Principal 740.8
Interest 76.2
Total 816.9
Item Plan2019
II. CUSTOMER & EXTERNAL ACTIVITIES
1. Consumer banking
1. 1 Strategic orientation and central goals for 2019
- Develop account and individual customer services through coordination with
electricity agencies, foreign companies, microfinance companies and Large
Corporate, SME Division to implement the cross-selling program. Implement direct
sales campaigns throughout the system
- Promote bancassurance
- Promote and increase sales activities through partner channels
- Implement internal programs to boost sales
- Product development: enhances the functionality of services to bring more
convenience to customers
10
1. 2 Business target for 2019
Unit: bil dong
(+/-) %
Deposit 37,583 30,696 6,887 22%
Loan 25,926 22,507 3,420 15%
Number of customers 900,000 863,246 36,754 4%
Card 85,000 62,638 22,362 36%
Number of ATM (accumulation) 229 207 22 11%
Number of POS (accumulation) 1,950 1,394 556 40%
ItemBudget of
2019
Actual of
2018
Vs actual of 2018
2. Large corporate banking
2. 1 Strategic orientation and central goals for 2019
Deposit:
- The rate of payment deposits on total deposit maintains at 32%;
- NIM deposit is at least 1.2%;
- Promptly control and issue deposit prices to ensure competition with the top banks
having similar scale (HDBank, VIB, TPBank ...), but the price will be more
competitive than the top and state-owned banks (ACB, TCB , MB ...);
- Keep and slightly increase traditional strategic partners, expanding target customer
groups such as hospitals, FDI, insurance, schools...;
- Promulgate programs to promote payment deposit, deposit certificates
Loan:
- Loans must be accompanied by increased fees and deposits (especially payment
deposits), prioritize short-term credit growth. For medium and long term, limiting
loan for long-term projects, appropriate threshold for suitable customers, limiting the
concentration of large outstanding loans for customer / group of customers not
belonging to target customers, distributing risks by inviting syndicated banks;
- Maintain LDR of large corporate segment at 64%;
- A minimum NIM for large corporate segment is at least 2.2% (average of both VND
and USD);
- Focus on exploiting large corporates for cross selling to SME, individual customers
and especially chain products
Services & guarantees :
- Focus on developing high – tech products: Tax, treasury, customs, fax,
internetbanking, central account management services …;
- Cooperate with financial institutions to promote the collection and payment services;
- Build and deploy product packages to increase international payment fees, and
exploit contractors;
- Promote bancassurance ;
- Increase the number of banking products used by each customer, to 6 products and
services.
11
2. 2 Business target for 2019
Unit: bil dong
(+/-) %
Deposit 41,913 33,595 8,319 25%
Loan 21,386 24,150 (2,765) -11%
Number of customers 3,108 2,845 263 9%
Revenue from service and guarantee 190 97 93 97%
ItemBudget of
2019
Actual of
2018
Vs actual of 2018
3. SME
3.1 Strategic orientation and central goals for 2019
Parnership activities
- Effectively implement the programs issued in 2018, including successful linkages of
industrial parks under the loan program for customers leasing industrial parks and the
program of Department of Planning and Investment (DPI) to develop the number of
business units signed cooperation with DPI, and the number of successful referrals
from DPI.
- Deploy cooporation program for car loans with partners in 2018;
- Develop a new partner program based on key products for SME customers;
- Accompany and sponsor the Southern Advisory and Start-up Advisory Council.
Trade activities and cash flow management
- IFF-ABB Smart Agricultural Finance Project piloted in the Mekong Delta region. It
is expected to deploy two products: products for SME customers in agriculture and
products specific to Agricultural Cooperatives.
- Deploy term online automatically products deposit;
- Complete the target of VND 3 bil in 2019’ insurance service revenue, the key product
is Mortgage Credit Security.
Credit activities
- Credit products, guarantees: Build, manage and improve products and services for
SME segment towards specialization, increasing efficiency and competitiveness in
the market, for existing products and new products / new markets.
3.2 Business target for 2019
Unit: bil dong
(+/-) %
Deposit 6,623 3,681 2,942 80%
Loan 15,568 9,826 5,742 58%
Number of customers 27,451 24,565 1,710 7%
Revenue from service ( excluding
guarantee)77 39 37 95%
Guarantee fees revenue 85 44 41 91%
Trade service revenue (USD mil) 326 309 17 6%
ItemBudget of
2019
Actual of
2018
Vs actual of 2018
12
4. Interbank investment activities
4.1 Strategic orientation and objectives for 2019
Liquidity and treasury activities
Ensure liquidity for the ABBANK with reasonable liquidity ratios. In addition, comply
with Circular 36/2014 and Circular 06, the solvency ratio for each type of currency of
ABBANK is always higher than required level of SBV, the maximum ratios of short-term
funds to be used for medium and long-term loans is controlled under 40%. Moreover,
large cash flow scenarios are constructed on daily basis, creating the fundamental for
liquidity and treasury management to ensure safety and Gap limits which are approved
by ALCO. Interest rate movements in the market are closely monitored on daily basis,
internal interest rates are applied under the new mechanism and adjusted in time
Fixed income activities
- Money market activities
+ Ensure liquidity for the whole ABBANK system ;
+ Continue match tenor trading (GAP) for both VND and USD from 3 months to 6
months tenor and within allowed limits ;
+ Promote repo and swap transactions in order to diversify business types ;
+ Establish new relationships with credit institutions that have few transactions with
ABBANK, implement transactions with secured or mortgaged assets for these
partners.
- Government bonds and valuable papers issued by other credit institutions
+ Government bonds: Monitor closely market movements in order to make timely and
profitably purchasing decisions for the Bank. Boost transactions and capital turnover,
focusing on trading bonds with tenor less than 5 years limit risks. In addition, when
meeting big "wave", bonds with tenor over 07 years would be transacted, reducing
duration to increase profits. At the same time, new products would be researched to
put into business
+ Bonds of credit institutions: In 2019, the Division expects to buy short-term valuable
papers of VND 2,000 bil issued by Credit Institutions to increase income for the
Bank;
+ Corporate bonds: Strengthen observation, follow and urge to recover corporate bonds
with maturiry date in 2019, ensuring capital safety .
FX trading and derivative activities
- Increase interbank transactions, boost USD trading position to improve sales and
profits. With the goal of reaching USD 70 bil in the interbank market (spot, term,
currency swap) and the profit of VND 177 bil
- Develop new customers to achieve growth in sales volume with individual customers
and corporate customers, reaching USD 2 bil in 2019;
Parnership (FI)
13
- Promote cooperation with strategic partners, IFC, Maybank and domestic and foreign
financial institution partners to serve international payment activities, capital and
other cooperation;
- Collect information and assess partners to grant transaction limits in 2019
- Promote the implementation of World Bank's capital loan projects such as Rural
Finance Project II (RDFII), Sustainable Agriculture Transformation Project
(VNSAT).
4.2 Business targets for 2019
Profit target
Unit: bil dong
(+/-) %
Monetary (283) (698) 415 40%
Bond investment 1,269 1,237 32 103%
Exchange currency 177 177 - 100%
Financial investment 32 34 (2) 95%
Profit/ Loss from other activities (8) (59) 52 13%
Total Trading profit before provisions 391 487 (96) 80%
Total Banking profit before provisions 797 204 594 392%
Total Treasury & Banking profit before provisions 1,188 691 498 172%
Provisions - (19) 19 0%
Total Treasury & Banking profit after provisions 1,188 672 517 177%
ItemBudget
of 2019
Actual
of 2019
Vs actual of 2018
5. Network development and marketing activities
5.1 Network development plan for 2019
- Expand the network (3 branches and 5 transaction offices);
- Implement the renovation and relocation of branches and transaction offices of the
Plan 2018 to move on 2019 and new arising .
5.2 Marketing and brand development activities in 2019
Strategic objectives :
- Increase the brand value of ABBANK ;
- Consolidate brand positioning : The friendly and social responsible retail bank ;
- Renew Brand’s positioning: The happy, modern, active bank .
Specific activities
- Main idea: “An Binh is Happiness” with target customers: multi-generation
Vietnamese families, office women, SMEs
+ Main channels : Outdoor Advertising (OOH), Program Sponsor (TV sponsor), radio
+ PR : Roadshow, activation, booth sale ... at transaction points or big selling points -
where many families are gathered (supermarkets, trade centers - gathered in Hanoi,
14
Ho Chi Minh and Da Nang, Can Tho); Co-branding; Express corporate social
responsibility ( CSR); Digital Marketing; Develop brands on Digital channels
- Communication activities : Press cooperation , Handling crisis , External PR , Internal
PR , Event organization
- Promote products and services : Rejuvenation customer and increase new customers
- Support communication promotion for business units : Direct marketing , Advertising
in business units , Managing business unit image
- Market research : Conduct market research activities through self-organizing research
groups or outsourcing professional market research units as a basis for brand and
service development activities. Build a centralized data warehouse for marketing to
efficiently access and exploit data.
III. OPERATION AND ORGANIZATION
1. Credit management
1. 1 Orientation and main focus in 2019
- Conduct asset appraisal, credit reevaluation and credit approval according to
ABBANK's credit policy and strategic objectives .
1. 2 Main activities for 2019
Credit appraisal and approval
- Develop a process of credit appraisal procedures to ensure compliance with credit
policies throughout the ABBANK system .
- Continue to implement project : Credit document transferring system
- Participate in Scorecard Project ( A Scorecard) for SME segment
- Participate in LOS Project (Loan Origination System)
Asset appraisal
- Number of valuation assets: 28,000 assets
- Number of consulting fees for mortgage of assets expected to be collected: VND 18
bil
- Quality control: 04 areas
- Survey of minimum price frame in 13 areas including: TP. Ho Chi Minh City, Hanoi,
Da Nang, Can Tho, Dien Bien, Nghe An, Thanh Hoa, Thai Binh, Lang Son, Tien
Giang, An Giang, Binh Phuoc, Long An .
Credit monitoring
- Review and complete credit monitoring process. reporting system in line with new
operating model of ABBANK
- Directly monitor in business units in accordance with the approved plan. with a target
of at least 60% of the total system credit in 2019 (with sufficient conditions for
recruitment personnel upon request).
- Continue to carry out quarterly remote review for high-risk potential customers such
as customers with large quotas, mortgage customers to claim debt / inventory / stocks
15
2. Risk management
2. 1 Credit risk management
Orientation for 2019
- Credit policy
+ Review credit policies in accordance with legal regulations, State Bank and credit
development orientation of ABBANK .
+ Systematize and simplify credit policies. improve the quality and application of
documents effectively .
+ Increase the independence between business and credit appraisal and approval
departments to enhance the quatily of credit approval .
+ Promulgate Credit Risk Appetite. Credit Risk Limit and Orientation in 2019 to
orientate bussiness activities of ABBANK in 2019.
- Credit Portfolio : measure, monitor and control credit risk limits. credit portfolio.
provide periodic and irregular reportings/warnings for competent authorities to make
timely decisions to balance between risk and profit.
- Continue to upgrade / build the remaining scorecard (Consumer, large enterprise) and
rating system, to comply with Circular 13/2018.
- Social environment : implement the Environmental and Social policy and the process
to appraisal. review. assess the impact of environmental and social risks on customers
having existing loans at ABBANK as well as propose plans to prevent and minimize
risks.
Implemented solutions
- Review and amend to ensure the uniformity of the credit policy system .
- Propose additional credit approval workforce at the head office, gradually reduce and
proceed to revoke the credit approval authority of Business units .
- Automate reporting system in order to save time and human resources. standardize
related data sources. build tools for data extraction. statistics. automatic data analysis
according to the request of the Executive Board and related departments/ devisions.
- Develop a system of managing social security risks in credit granting activities
(ESMS), and a set of social security risk assessment tools by manufacturing and
business sectors.
2. 2 Market risk management
Orientation for 2019
- Identify, describe, evaluate, quantify, control and monitor market risks, liquidity and
interest rate risks in banking books in accordance with the State Bank's regulations
and in accordance with the reality situation of ABBANK
- Develop policies / tools / models to manage and minimize market risks, liquidity and
interest rate risks in banking books .
- Coordinate with Banking Technology Division to improve the quality of risk
reporting .
Solution
16
- Review and adjust regulations / policies / processes related to market risks, liquidity
risks and interest rate risks in banking books in accordance with State Bank
regulations and situation reality of ABBANK.
- Supervise limit compliance and study to relevant limits .
- Make periodic / extraordinary reports on market risk, liquidity and interest rate risk
in the banking book to help competent authorities make timely decisions, ensure
liquidity and balance between risk and profit.
2. 3 Operational risk management
Orientation for 2019
- Develop, adjust and perfect the system of operational risk management documents,
focusing on documents and policies meeting requirements in Circular 13/2018.
- Enhance the quality and effectiveness of risk reports from the team of risk
management staff (RO).
- Standardize of operational risk data through the collection of RO information from
the Risk Management Software .
- Develop a plan to maintain business operations (BCP) in the whole bank, and
complete relevant policies.
- Focus on advising on solutions to prevent and reduce risks, helping business units to
limit losses caused by operational risks .
Solution
- Complete policies and procedures on operational risk management :
+ Build and submit BOD to issue risk appetie and risk limits for operational risk .
+ Update, amend the operational risk management tools (RCSA. IMDC. KRI) to align
with the risk appetite, risk limit and business strategy of ABBANK .
+ Update and amend Risk profile to align with actual risk status .
- Motivate a risk management culture in the whole banking system :
+ Create more risk warning news, timely update high risks and frauds which regularly
occur in the market or at ABBANK .
+ Build up documents and carry out face-to-face training or elearning related to
operational risk management and provide guideline on implementing risk
management tools (IMDC. RCSA).
- Collect risk information from risk officer (RO): Enhance communication activities to
motivate ROs to report risks .
- Develop risk status management software :
+ Guide and collect risk reports from all of the ROs through risk status management
software
+ Coordinate with IT division to research, update functions and improve risk status
management software comprehensively .
- Business continuty plan (BCP): Propagate the online information channel on BCP to
supply policies, guidelines and information related to BCP in a timely and fully
manner so that all staffs can access .
17
2. 4 Basel project
Orientation for 2019
- Complete the Project of Risk weighted asset calculation system on schedule in
accordance with the Circular 41
- Golive RWA system
- Implement the Project of Risk Appetite improvement, develop and implement the
internal capital adequacy and assessment process
- Implement preparatory activities for Accomplishing Market risk management
framework according SBV and Basel II’s requirements
- Update internal policies and procedures within RWA project scope
Solution
- Collaborate with consultant and system contractor to catch up with the plan signed
by the contract between the parties
- Periodically report on project progress, quickly update difficulties and issues to find
solutions
- Ensure supports and commitment from top management to facilitate the
implementation of the project
3. Banking techonology management
3.1 Orientation for 2019
- Focus on key projects that help to improve the capability to support business
development and internal management; minimize risks in banking activities; apply
high technology in products and services of digital banking channels, providing new
experiences for customer and creating competitiveness in the banking sector
- Continue to invest in information technology infrastructure, especially in modern
security solutions to reduce transaction costs and prevent risks and be more
professional .
- Strengthen supervision on IT service quality to ensure its stability and safety in
accordance with service management standards such as: ITIL. ISO27001.
Meanwhile. deploy IT solutions to meet information system standard under the State
Bank of Vietnam's Circular No. 18/2018/TT-NHNN.
3.2 Solution
- Big data warehouse with tools to analyze / evaluate customer behavior
- Apply modern technology in business activities
- Ecosystem to connect with business partners
+ Solution to connective services management with external partners including Fintech
– API
+ Seek and maintain relationships with high technology partners, establish a creative
work environment (Co-working Space)..
- Build capacity of management and administration
- Build capacity of risk management according to international standards Basel II
+ Deploy the credit risk management model (RWA SA).
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+ Deploy capital adequacy system .
+ Deploy the market risk model .
- Ensure flexibility and stability of IT infrastructure
+ Standardize application structure according to international standards (SOA, Open
API, microservice).
+ Apply international standards in IT service management ( ITIL. ISO27001-2013;
ISO20000)
- Ensure security for IT systems
- Deploy the next phase of United Communication projects .
4. Operation management and customer service
4.1 Credit operation center
- Upgrade the Internal Document Transferring System in line with new business model
under Decision No. 64/QĐ-HĐQT.18.
- Develop applications to complete Limit. Collateral. LD Loans and Guarantee on T24
Corebanking
- Regularly manage and update credit-related documents and regulations to make sure
that all documentary staffs and credit-admin staffs are able to approach these .
- SLA and Transaction safety ratio reach 95% and 90% respectively .
- Ratio of Claims from business units: under 5%.
- Check and review the compliance of business units before and during process .
- Issue, review and update internal documentary folders related to credit operation
4.2 Local payment center
Orientation for 2019
- Improve service quality and increase productivity :
- Reduce the transaction processing time by 20% after deloying and stabilising the
strategic project to improve the capacity of automatic bank transfer
- Increase productivity by 5%
- Risk control :
+ System risk: Coordinate with IT to completely upgrade payment system in
accordance with the SBV’ roadmap .
+ Operation risk: Coordinate with relevant departments to give warning of risks in
payment activities at the Center .
Solution
- Implement the project upgrading the interbank payment system (CITAD) under the
guidance of the State Bank according to the IBPS2.5 data exchange standard to serve
the whole domestic payment transaction.
- Deploy new applications on T24: 12 applications, key applications such as :
+ Application for State Budget Transactions
+ Application for foreign currency payment
+ Applications related to ebanking
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4.3 International Payment Center
- Golive Swift GPI project to make international transfer service more convenient, that
strengthen competitiveness
- The rate of the transaction that meets the processing time requirements is over 95%;
STP rate is over 96%; Transaction safety rate is under 98%.
- Develop 10 applications for trade services
- Collaborate with correspondent banks to seek for business opportunities to develop
trade finance cooperation products and find out solutions to improve the quality of
the supports of correspondent banks.
- Apply AML- FATCA system for all international payment transactions
4.4 Customer service center
Orientation for 2019
- Improve the customer’s satisfaction
- Standardize and improve service quality, focusing on counter operation
- Take advantage of the role and the responsibility of the HO Cash & Counter
Management to the transactions at the business units
Solution
- Maintain and ensure the stability and smoothness of the Contact Center system in
order to ready to receive and process customer’s feedback 24/7: The stability rate is
over 98%, the receiving and handling incoming call rate is over 98%, The recalling
and handling missed call rate is 100%
- Support and interact closely with customers through Webchat channel .
- Collect, report exactly customers’s responses on time and take responsibility to
analysis and provide recommendations to the Directors and related departments units
.
- Standardize the skill sets of the Teller/ Supervisor/Cashier/ Counter by providing
training courses to each position .
- Simplify the Teller forms to improve the customer satisfaction .
- Control the implementation of KPIs, SLAs and assess the quality of services and
tellers .
- Work with other departments as focal point to develop the program of Cash
Management in T24 to reduce the operational risk at bank counter .
5. Anti - Money Laundering
Orientation for 2019
Execute AML tasks in a safety and effective manner in line with regulations of Laws
and international commitments
Solution
- Issue and control ABBANK's internal regulations on anti - money laundering
prevention based on the current law of Vietnam and international commitments .
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- Work as focal point department, preparing reports requested by the Anti-Money
Laundering Department under the inspection agency of the State Bank or other
competent State bodies for transactions and activities related to the prevention and
combat of money laundering according to the law.
- Supervise, support and guide business units in implementing anti - money laundering
activities. Receive related information from units and make reports in compliance
with the law .
- Active Anti-money laundering software in the whole system .
6. Progress of 5 strategic goals and strategic intiatives
23 Stategic projects until 2020
- Ensure the updates of deploying projects, fitting to timeline and following the vision,
orientation, objectives and strategic initiatives which have been approved by BOD;
- Continue to work with strategic experts and software agencies to deploy Phase II to
upgrade Strategy Map KPIBSC
Digital Banking
- Objectives
+ Attract 1 mil customers and earn the profit of VND 200 bil in 2019
+ Develop the foundation for Digital Banking Division in 2019, including: 5-year
vision and 2-year plan (2019-2021), digital platforms, sharing partner system,
strategic partners and programs, product / service sales channels, management
process, human resources
- Roadmap of the first 5 years ( from 2019 to 2022) includes 3 stages
+ The first stage until the end of 2019: Complete the target of the profit of VND200
bil and one mil customers
+ The second stage – Connection and diffusion (2020): Take advantage of one mil
customers and increase by 20% in new customers
+ The third stage – Development and exploitation (2021-2022): Revenue > VND300
bil / year; Top 3 Vietnamese Digital Banks; Cooperate with 70% of big partners
7. Service customer management
Orientation for 2019
- Improve regulations on service quality in order to perfect the document system for
different positions at the Business Unit .
- Control and review regularly in order to improve of awareness and routine of
compliance with internal and external service quality activities .
- Conduct internal as well as external customer satisfaction surveys to acknowledge
feedbacks. improve existing issues and provide results for KPIs .
Main activities in 2019
- Internal service quality activities :
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+ Operate, control and evaluate SLAs implementation of HO units by different
channels, provide SLAs KPIs for HO units. After that. build SLAs for Business
Units, or build end-to-end SLAs for 1-2 processes.
+ Build improvement process and research, survey, implement Kaizen competition
Program
+ Deploy logistic support channel as the channel to receive, analyze and
handle/monitor the requests related to internal service quality .
- Customer service quality activities :
+ Implement service quality checking through channels: mystery customers. direct
checking. camera. online test. customer survey. SLA. ... Assess quality of call center
service. Organize service quality training courses in the whole system. implement
service quality emulation programs.
+ Implement internal and external customer satisfaction surveys .
8. Internal audit
Orientation for 2019
Develop an auditing plan for 2019 based on the risk assessment in accordance with
Circular No. 13/2018 / TT-NHNN dated 18/05/2018 and KPMG consultancy (if any) to :
- Fully perform the functions and tasks of the Internal audit department
+ Complete all audit plan /audit fieldworks/ unscheduled audit in 2019.
+ Monitor and implement internal projects as planned .
+ The results highly appreciated by the Supervisory Board; Board of Director and
General Manager .
- Reach quantity and quality indicators of Work - (Key Performance Indicators (KPIs)
2019 of the Internal audit department)
+ Conditions that affect the performance of the department in 2019.
+ Main KPIs of the department (Financial Indicators / Operation. Risk Management.
Quality of Service / Customers. Learning. Development and Other Indicators)
- Cost and budget efficiently management: According to data from the financial
accounting department .
Solution
- Register and upgrade the Initiatives / Projects for implementation in 2019 to support
audit plan /audit fieldworks/ unscheduled audit more efficiently with the aim to
reduce time and increase productivity for IAD. includes:
+ Improve the interface and information of IAS system .
+ Develop the follow-up system automatic monitoring and warning system to business
units
+ Develop more automatic reports according to professional requirements .
+ Upgrade an audit fieldword module
- Strengthen coordination with Human resource department to recruit more staffs for
Internal audit department as planned
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9. Legal & Compliance
Orientation for 2019
- Provide legal advices and legally support to the whole system to perform the
functions and duties of Department .
- Improve the process with a focuse on improving the quality of consultancy, reduce
consultancy time and provide solutions to improve the legal knowledge for the
business unit, that reduce the content of consultancy about the same problem
throughout the system.
- Standardize sample forms and contracts and adopt mechanisms to reduce the adoption
of exceptions through the review of repeated exceptions ,
- Manage the authorization system, internal documents. control legal documents before
issuing .
- Work as representatives of ABBANK to participate in various proceedings (plaintiffs.
defendants. persons with related rights and obligations) in a number of cases to
protect the rights of ABBANK, except for related cases to debt processing.
- Perform the function of the compliance unit as the second barrier according to
Circular No.13/2018/TT-NHNN and the new organizational structure at ABBANK.
- Build up tools, reporting system, professional process to promote remote monitoring
and direct monitoring
- Manage cost and budget effectively and economically
Solution
- Colect and synthesize the legal consultancy which regularly arise, to formulate legal
guidance and frameworks for business units to apply .
- Improve legal analysis, legal newsletters, legal forums.
- Review, standardize and revise the contract forms and create new contracts/
exemption documents to reduce exceptions.
- Focus on raising the professional qualifications of staff members through training,
self-training, professional seminars and classes .
- Recruitment / train qualified staffs to serve the overall goal of the Department.
- Complete regulations and operational procedures for each part in the Department to
ensure uniform operation. Use SLAs to measure results, quality of work.
- Complete professional procedures for compliance monitoring; build a system of
reporting and applying information technology to receive and exploit information and
databases in the system.
- Review and evaluate the internal document system (DMS) and request the drafting
units / divisions to review and adjust to ensure the compliance and control of internal
document quality. In terms of the internal documents of the departments: review the
regulations and procedures issued before 2018 for updating. modify and supplement
them in line with the reality of operation. the regulations internal regulations and
relevant laws.
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- Strengthen direct supervision, handling of complaints, denunciations, internal
denunciations to handle violations to ensure compliance, deterrence and preservation
of ABBANK's image
IV. HUMAN RESOURCE TRAINING AND DEVELOPMENT
1. Orientation for 2019
Personnel development objectives at ABBANK :
- Attract and retain potential employees, talents and key personnel ;
- Improve labor productivity and service quality provided to staff;
- Build a positive working environment ;
- Improve human resource management .
Training and development activities of ABBANK in 2019 is focused on the following
points
- Develop learning culture, learning community at ABBANK to improve employees’
s voluntariness and creativity, innovation throughout the system ;
- Upgrade the talent development program with the aim to define the following
positions for long-term plan ;
- Standardize the training on the curriculum framework, the syllabus – lecturers, the
periodic test and the attachment of the learner's results to the their assessment /
management (promotion. work performance…)
2. Solution
Salary & remuneration policies :
- Convert the new salary system based on the results of the project "Evaluation of work
and wage restructure";
- Implement payroll calculations on new HR software ;
- Build 2019 Salary Budget and Plan for 2020;
- Develop ABBANK care 2019 program
Human Resource Management :
- Implement the Job description project in harmony with the new organizational model;
- Implement new HR software ;
- Carry out the human resources work: Manage labor contracts, personnel records,
manage SLAs of the Division .
- Carry out the rewarding and disciplining in the whole bank ;
- Review and revise internal documents: Rebuild ABBANK internal labor regulations
;
- Bring the Division Portal into official operation ;
- Continue to implement the mobile management program ;
- Organize programs: Teambulding, team emulation programs.
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Training & Development :
- Design and implement ABBANK Talents program to retain outstanding personnel,
supply personnel to the positions of Board of Managers, Head of Business Units and
developing leadership / expert capacity for talented people;
- Review and adjust job title training programs after 03 years of implementation;
design / adjust training programs – successor development ;
- Continue programs and activities to develop the learning community at ABANK:
prioritize training programs, online learning, professional competitions ...;
- Strengthen overseas training programs (including Europe and Asia)
Recruitment
- Recruit as planned in 2019;
- Meet the demand of personnel management as requests by the ABBANK’ units ;
- Update and issue documents relating to recruitment and staff management at
ABBANK ;
- Deploy and participate in Career Day of universities nationwide and Career Talk
Program to strengthen ABBANK's employer brand as well as create and attract good
human resources for ABBANK ;
- Cooperate with Marketing department to implement marketing programs to promote
the bank’s recruiting brand ;
- Conduct market surveys to capture recruitment market trends. thereby adjust and
renew recruitment at ABBANK ;
- Build and deploy the Future ABBankers 2019 (Internship Program) to create human
resources for business units ;
- Collaborate with the Banking Technology Division to develop New staff’s records
management and test online application.
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APPENDIX 01
ABBANK’ financial plan for 2019
Balance sheet
Unit: bil dong
+/- %
Total asset 105,720 90,237 15,482 17%
Cash 1,527 860 667 78%
Deposits at SBV 2,036 2,172 (136) -6%
Deposits at and Lending to other credit
institutions 18,247 9,119 9,128 100%
Trading securities - - -
Investment securities 18,346 21,151 (2,805) -13%
Loans 60,435 51,815 8,619 17%
Customer loans 61,323 52,465 8,859 17%
Provision (889) (649) (239) 37%
Long-term investment and capital
contribution 444 529 (85) -16%
Fixed assets 1,440 970 469 48%
Derivatives and other financial assets - 108 (108) -100%
Other assets 3,246 3,513 (267) -8%
Liabilities and equity 105,720 90,237 15,482 17%
Due to Government and SBV - 6,753 (6,753) -100%
Deposits and borrowing from other
financial institutions 11,017 9,344 1,673 18%
Funding from other credit institutions 936 1,152 (216) -19%
Derivatives - - -
Deposits from customers 78,439 62,547 15,892 25%
Valuable papers 4,170 1,943 2,227 115%
Other liabilities 2,309 1,673 635 38%
Owner' equity 8,849 6,825 2,024 30%
Criteria Plan 2019 Result 2018Compared to Result 2018
