General director of Vietnam Technological and Commercial Joint-Stock Bank (Techcombank) Nguyen Le Quoc Anh shared with us about the bank’s operation plan in the last months of the year.
According to Quoc Anh, the shareholder has assigned the bank a pre-tax profit of 11.75 trillion dong this year, and by this time the bank is determined to do better. In the last three months, besides speeding up operations, the bank will also focus on preparing for the 2020 plan.
At the beginning of the year, he mentioned that the government’s policies this year were tighter, so there must be changes to adapt.
First of all, he asserted that the State has issued the tightening policies to protect the system. Once he knew that, he realised what was good, what was needed to protect the bank and his responsibility was to take action in advance.
For example, about the ratio of short-term capital for medium and long-term lending, if the State reduced to 40 percent, then the bank had to lower to 35 percent, and when it reduced to 35 percent, the bank must adjust to 30 percent.
As people were concerned about the increase in the lending ratio for real estate, the bank must also prepare in advance to reduce lending to this group and not be passive about changes in policies. generally, we anticipated and went one step ahead.
Among the stricter policies related to bonds, of which Techcombank is an active member in this market, does the fact that the State Bank of Vietnam (SBV) warns about the risk of bond investment affect the bank operation?
Frankly yes.
When that circular came out, the bank also carefully prepared to ensure that when people had investment needs, the bank had to solve it. Banks that issue bonds for large businesses must choose partners to ensure safety and transparency for investors.
Strictly speaking, it has two dimensions, on the one hand, it is guaranteed for bond investors, and on the one hand, bond issuance businesses must have prestige to ensure the ability to repay debts.
In the long run, Vietnam’s banking system must use financial markets to have enough resources to help large enterprises raise capital. Large businesses are the foundation of the domestic economy, and when the economy is strong, we cannot simply rely on the capital of the banking industry. If we rely on banks, we will be stuck and not develop.
Therefore, Techcombank has been one step ahead and made efforts to jointly build and develop a large and healthy corporate bond market in Vietnam, which means ensuring safety for the investors, large enterprises and Vietnam’s banking system.
Among Techcombank’s partners, Vingroup is very large, even some people say if Vingroup sneezes, Techcombank has a headache. Hence, in the near future, are you planning to expand to other large customers to reduce risks?
Previously in the United States, it was said that whenever the GM car company sneezed, the whole United States caught the flu, so was our case. The reason why? Because Vingrouprip is very big and active in many economic fields, from real estate to retail, industry, technology, health and education in Vietnam. These are the key and important sectors of an economy that a bank serves.
The other problem is that, if the question is how many percentages of our profits or of our revenue come from a corporation, that’s not a big number.
When Techcombank works with a large corporate customer, the bank not only serves that business, but also organises to serve an entire ecosystem around, with financial needs from partners to their customers. Moreover, large corporations never use only financial services and deposit arrangement of a bank. They all have to find other sources of capital, from financial markets both at home and abroad.
Techcombank’s zero dong e-Banking policy helps customers save hundreds of billion dongs per year, but is it fair to investors when other banks collect fees and have more profits and pay more dividends?
Techcombank focuses on long-term value, but the long-term value of every business always comes from customers. I often interpret that CEO = CustomersEmployeesOwners, meaning that the priority is the customer first, then the employee and then the investor.
Because the long-term value of investors comes from customers and staff members to be profitable. Without them, the bank can not make profits and the investors will not reap the expected value.
Therefore, we give priority to investment in our employees, since then our staff will have the basis to advise on the best services and solutions for our customers. After that, customers stick and always look to the bank for services.
Based on that argument, we have just launched a free transaction programme. Strictly speaking, a bank is essentially a place to mobilise capital and borrow money from people. If the loan service from the customer is always guaranteed to bring high benefits, then customers will trust the bank’s services, and then return to use the service many times. Using banking services many times a day is a factor that adds value to the bank, and ultimately benefits the investors.
