The pressure of job targets exists in many sectors and industries but for finance and banking staff, these targets are much higher, not only targets about credit, deposit mobilisation but also insurance and real estate sales through affiliates. Even, some banks operate as open-ended funds.
Having demand for saving, Minh came to a bank’s transaction office on Vo Van Tan street, District 3, HCM City. She was advised that the saving deposits should go along with an insurance package of the bank’s affiliated insurance company. Of course, the premium of the aforementioned insurance package is not related to her savings book at the bank.
Not only introducing insurance products to customers, the bank staff also presented the investment in open-ended funds that the bank connects with VinaWealth, with offers about super-profit.
Previously, only employees of insurance companies “hunted” customers by making telephone calls, sending emails then now, banks also strengthen the cross-selling of insurance products. Especially, in 2-3 recent years, when credit operation of banks faced difficulties, the promotion of non-interest income is concerned.
In fact, many banks have succeeded in the cross-selling of insurance products. The revenue from the commission discount is very large, contributing hundreds billion of dong, even trillions of dong to the total revenue of banks.
In contrast, insurance companies have also attained positive results when there is no need to expand agents, network and people but can still cover operations nationwide through the widespread network of transaction offices and branches of commercial banks. This is also the reason why banks have raced to develop bancassurance with affiliate contracts amounting to dozens of years or even 20 years. Bank-insurance cooperation has been happening continuously in recent time. For example, DongABank cooperates with AIA Vietnam insurance company.
Or, to support the cross selling of insurance products, MBB has the subsidiary i.e. MB Ageas Life Insurance Co., Ltd (61 percent), Military Insurance Joint Stock Corporation MIC (69.5 percent).
The strengthening of cross-selling has helped MBB earn as much as 1.851 trillion dong from insurance service in 2017, up 7.8 times from 2016. Not only selling insurance products of subsidiary company, this bank also expands the affiliation with other insurance partners to increase revenue from insurance premiums.
Meanwhile, BIDV has BIDV Insurance Corporation (BIC-51 percent stake), Lao-Viet Joint Venture Company (LVI-33 percent stake) or BIDV Metlife Life Insurance Company (37.5 percent stake). Therefore, BIDV earned quite large results from insurance over the last many years.
In order to compete in this game, SCB acquired Bao Long Insurance Corporation with annual revenue amounting to trillions of dong. Not only so, SCB also signed contract with Bao Viet Insurance Corporation to carry out insurance products aiming at boosting insurance revenue and shook hands with VinaWealth to distribute open-ended fund.
Meanwhile, Sacombank has quickly cooperated with Vietnam Post and Dai-ichi Life Vietnam, including the provision to Sacombank non-life insurance service. In the upcoming development strategy, Sacombank plans to set up a joint venture life insurance company with a foreign partner, acquire or newly establish non-life insurance company in order to strongly increase revenues from insurance when other banks are also thoroughly exploiting this lucrative source of benefits.
The acceleration and strengthening of the link between bank and insurance partners makes the pressure on business target of bank staffs to increase. Hong Lam, a bank staff says that working for banks now is no longer just to seek for borrowers and to mobilise but also sell insurance, real estate, etc.
“I have to mobilise my family members, even relatives to sell some insurance projects so as to meet the quarterly assigned targets”, said Hong Lam.
Apart from the key task i.e. to complete the credit document, Hong Lam added bank staff are also responsible for introducing apartment projects guaranteed by the bank. Accordingly, apart from marketing about the bank’s home loan product, credit officers also introduce the project to their customers.
Minh Vy, a Sacombank staff said the bank’s monthly business target is that home loan sales must reach the level set by branch director. However, to achieve this target, he must study and understand about the bank’s affiliated projects to be able to introduce and persuade home borrowers.
Apart from competitive lending rates, banks also offer incentives to customers when purchasing apartments linked with project investors, with the expectation of attracting more borrowers.
Meanwhile, Nguyen The Anh, a credit executive of a HCM City-based bank said pressure on target is high. Not only the target for major profession, he is also assigned with target about apartment sales from the association between bank and project investor.
The Anh explained, finding apartment buyers also mean that the bank will be able to strengthen lending. The market reality shows that home loan credit, especially customer segment, is mentioned and strengthened by almost all banks, especially in recent years, when the real estate market has grown again along with the rise of the economy.
The market reality shows that home loan credit i.e. customer segment has been strengthened by most banks especially in recent years, when the real estate market has grown again along with the rise of the economy.
Currently, the outstanding home loans of most banks account for the majority in the total oustanding loans of individual segment of banks, about 50 percent, and are expected to continue growing in the near future. Therefore, banks have strengthened their cooperation with investors, not only to strengthen lending but also to sell products to increase credit.
In the context that competition in the finance market is increasingly intense, to occupy market share, banks have not hesitated to recruit dozens of thousands of employees and collaborators to “hunt” customers and provide products to consumers. Therefore, credit officer is probably the old name that cannot reflect all the work that bank employee must perform.
According to the sharing of people working in the industry, credit officers have to suffer from very large revenue pressure especially super high expectation from leaders while feedbacks about insurance products/real estate/open-ended funds are not necessarily good. If the revenue is not achieved, then they will not get salary, bonus, etc. and can even be laid off.
Working at banks has been considered as a dream job for many people because the salary and reward amounted to dozens of millions of dong. However, many employees said not all positions in bank can earn several million of dong per month. In order to receive high salary, employees have to suffer from much pressure. On the contrary, if failing to attain the assigned target, many business and credit positions at bank only receive the monthly salary of 6-7 million dong.
Survey of Navigos Group the owner of VietnamWorks and Navigos Search recently showed that as many as 90 percent of banks pay their staff about 10-30 million dong per month. In order to have higher income, credit officers have to try to sell all kinds of products. “The highest pressure is sales target”, said Anh Thu, employee at ABBank’s branch when being asked about the pressure of the work that made her feel most stressful.
