Tóm tắt Luận án Credit administration in Laos’s commercial banks

Misnistry of Education and Training University of Economics Ho Chi Minh city KONGCHAMPA OUNKHAM CREDIT ADMINISTRATION IN LAOS’S COMMERCIAL BANKS Speciality: Banking and Finance Code: 62-34-02-01 ECONOMIC DISSERTATION ABSTRACT 2015 The dissertation was finished at : ......................................................................................................................................................................................................................................................................................... ......................................................................................................................................................................................................................................................................................... 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The thesis will be defend in the council at ....................................... .......................................................................................................................................................... At hourø date month year Research at :. ABSTRACT Chapter 1 INTRODUCTION 1.1 Thesis reason Until now there were some topics and research on credit activity, but no research topic specificed and updated the calculation of credit administration operations and improving credit quality commercial banks in Laos. From the fact that the thesis chosen the theme: "CREDIT ADMINISTRATION IN LAOS’S COMMERCIAL BANKS " to the study is derived from the urgent needs that are posed in practice in Laos now. 1.2 Thesis purpose - Chemical system to clarify the basic theoretical issues of governance of commercial banks credit activity in the economy. - Analysing the current situation credit management activity of commercial banks in Laos during the current period. - Giving the achievements and limitations of the credit administration operations in Laos’s banks; on that basis, providing solutions for credit management of commercial banks in Laos in the process of international economic integration. 1.3 Object and scope of study - Audience research : the dissertation research focused on credit management in general banks in the Republic of Lao People's Democratic . - Research scope: + Administration credit activities of commercial banks and due to limited Laos time and scale up the thesis was mainly focused on the activities of credit administration perspective mobilized resources management, credit growth and governance of commercial banks NPL Laos . + The situation was focused on the period 2008-2013 . 1.4 Data and methodology The thesis also uses general scientific methods of economic , inductive method , to investigate methods and typical survey , analyswas , mathematical methods , with the support of the calculation software and other relevant studies to highlight the depth and content of the research study . Raw data are collected after being counted , selection , editing , encoding and analysing, evaluation , and use of tables , graphs ... to illustrate the content analyswas which specify conclusions to ensure reliability for the research results . Chapter 2 THE OVERVIEW OF CREDIT ADMINISTRATION COMMERCIAL BANK 2.1 Basic issues about commercial bank In part of the thesis presents basic issues as the concept of the commercial banks, functions, roles and activities of commercial bank credit ... Because banks are diverse activities, professional technical complexity, change over space and time, again bearing the stamp of the economic and social environment in particular, should be scientifically very difficult to give a brief definition of banks was widely accepted. According to the Banking Law of the Republic of France, "Organization was considered the commercial banks are all publicly owned or private enterprises, where all branches or agencies of foreign banks, which was the main activity carried out operations treasury, credit operations, financial operations with deposits received by individuals, businesses or non-profit organizations .... ". The Law of the People's Democratic Republic of Laos capital was built on the foundation of European law, particularly the Law of France due to the impact from the Indochina era days ago, was now also subject to the influence of the Republic Vietnam socialist neighbors. Thus, banks as a currency trading firms have operations covering three areas: - Business debt (capital creation) - Operations have (loans, investments and trading) - Business Brokers, intermediaries (the payment service, agents, consultants, information, safe- keeping...) These areas are closely related, closely interwoven in banking activities on the domestic market as well as internationally; We support and promote each other grow, create more reliable and form of the bank brand. The media sponsor banks usually carry the following general characteristics: - Always a stock form of debt, was a deed confirming a financial sovereignty or sovereign tangible assets whether expressed in any shape or form. - In relation to the two entities: the creditors (lenders, investors, housing subsidies) and debtors (borrowers, investment recipient, the recipient) - Provides three service groups: + Share between the two entities on the solvency of the financing instrument (capable shifting assets into cash and vice versa at a low cost) + Share Risk + Share information (opportunities for profit) Credit Bank activities are the credit relationships between the bank with a side of the other actors in the economy , in which the bank acts as both a borrower that the lender has , in other words , banks restaurant was a financial intermediary temporary movement of capital from capital surplus to the deficit . Price (interest rate ) of bank loans to borrowers fixed income was that customers have to pay during the entire duration of the loan. Actors in relation credit bank activities are banks, government , businesses and households. Objects used in credit relationships was money , so it was not subject to limitation under the goods and multidimensional multimedia campaign . Thesis was the outstanding advantages and distinctive features between credit bank activities with other types of credit . Rules of Credit activity: - First, loan repayments and interest after a certain time - Second, the loan assets of equivalent value as ensuring - Third, loan purpose, according to the agreement from the previous plan( under the dongda signed ) 2.2 The overview of credit administration in commercial bank In the overview of the governance of commercial banks credit activity, the thesis was analyzed the basic contents of the administration activities of commercial banks include: Management of commercial bank capital lending, policy and sector borrowers credit investments of commercial banks, loan conditions, credit limits, network Administrator banks, interest rates and loan fees, loan duration and repayment periods and debt classification and risk provisioning credit, loan security, policy and debt management identify problems. Besides, the thesis was also presents the factors affecting the governance of commercial banks' credit activities as the economic environment - society in which banks operate, Profitability and risk of the loan different fiscal policy, monetary and credit administration of the State, quality staff and organizational structure of the bank's network, banking technology. And indicators to assess the effectiveness of credit administration activities of commercial banks. Lending capital management of commercial bank When research administrator credit bank activities, researchers often do not see the capital policy as a content of credit management. However the reality shows that, when studies of the commercial bank credit management, policies need to see capital as a basic content of credit management Policy borrowers and investment sectors of the commercial bank credit Many research papers have not mentioned the borrowers as the content of the commercial bank credit management, but customers see as governance principles that guide commercial banks to credit, credit is a strategy of the bank: " Stand at strategically speaking, a credit administration to attract customers, maintain and develop the customer to expand the scope of activities of commercial banks. " Loan condition Credit administration reflects the principles appropriate to the nature of credit, that is: to use loan funds for the purposes agreed in the credit agreement; Full repayment of principal and interest on time agreed in the credit agreement. Credit limits Commercial banks can not fund the entire loan demand implementation of customer projects to minimize risks. Administration of the commercial bank credit to build must not exceed the credit limit prescribed by law. The rules are: (1) the maximum loan to a borrower; (2) the maximum loan against the value of collateral; (3) the maximum loan for limited group of customers of credit; (4) the maximum rate used short-term mobilized capital for long-term loans. Commercial bank system administration Network operations often multiple levels of each commercial bank, central and branch level are often based in major urban centers, cities and provinces and towns, followed by the transaction. Banking Technology develops, intermediate levels tended to decrease gradually. Loan fees and interest rates The primary goal of commercial banks was profit, the content of the credit administration of commercial banks to determine based on thesis goal. Lending rates have been formed according to the market mechanism based on demand and supply in the market and the principle to cover the cost of raising capital and management costs, wage costs, offset risk and reasonable profit. Basel I and Basel II Pact Advantages of Basel I and Basel II : Basel I focus on a unique risk management solution is "the minimum capital requirements." While Basel II focuses more on internal methods of the banks, evaluation of inspection activities, supervision and discipline on market principles. Therefore, the power of national regulators are increased because they need to assess the capital adequacy of banks, taking into account the specific characteristics of its risks. Basic contents of the administrator of the commercial bank credit operations When research administrator credit bank activities , researchers often do not see of content sources was a constituent of credit management. However the reality shows that, when studies of the commercial bank credit management, policies need to see capital as a basic content of credit management, because: In terms of theory, the term Credit (Credit) was derived from the Latin word Credo, which means "trust and confidence". From that showed credit operations of banks in a broad sense was the use of reputable financial institutions to mobilize their own kinds of idle funds in the economy and using it to extend credit to those who have demand for loans was a bank trust. In other words, raising capital activity was an array of active credit policy under which raising capital was a basic content of credit management. Indicators to assess the effectiveness of Management of the commercial bank credit operations The size and growth of raising capital resourse - Scale of mobilization: the scale mobilization at a time that the entire balance of that type of capital mobilized by commercial banks have been at that time. It includes savings deposits with and without term, payment deposit, loans of organizations and individuals in the province. When evaluating thesis criterion, to assess its proportion compared to the plan, compared with the previous year. Market share of the raising capital To accurately assess the competitiveness of the banks at different times, need to consider in relation to comparable mobilization of credit institutions in the province and at the same time and in relation to comparable the size and growth of capital and the growth of commercial banks' customers that over the years. Entrepreneur credit and growth Entrepreneur credit - Entrepreneur credit : all amounts that are investment banking customers are households and individuals , enterprises and other economic sectors operating in the region. Thesis index reflects the size of the investment credit to customers in the province . When evaluated , to evaluate its proportion of total loans , compared with the industry and other economic areas , compared to the plan , compared with the previous year . Entrepreneur credit market share - Entrepreneur credit market indicators of a commercial bank , a commercial bank branch was determined by the percentage of the bank 's regional Entrepreneur credit in total investment in the province Entrepreneur credit of all credit institutions. Methods of evaluation criteria are the same criterion 2 . 2.3 Literature review In previous studies, the author presents the research related to credit administration activities at commercial banks in the world Due to limited in scope and duration, should dissertation research focuses on the aspects to be considered as a very important activity of credit administration in commercial banks that Lao administrator of mobilization, credit growth, and controlling bad debt in the banking system of Laos. Non-performing loan management Most empirical studies examine the impact of the macroeconomic environment to bad debts, as well as administrator effectiveness bad debt and bank credit. Rinaldi and Sanchis-Arellano (2006) analysed of bad debt of households in the European countries and provides empirical evidence that disposable income, unemployment and financial capabilities have strong impact on bad debt. In research on the Nordic banking system in the period 1993-2005, Berge and Boye (2007) have found that the problem loans (NPLs) are very sensitive to real interest rate and unemployment rate. Credit growth As Arellano (1990) points out three-phase method least squares (3SLS) is a convenient method for the estimation of the linear model using panel data with a relatively short time and includes the latency of the dependent variables. The applied research methods commonly used to estimate 3SLS equations with lags of the dependent variable (for example, in the study of Hall, 1987; and Sab and Smith, 2002) Ability to repay Most previous studies on the evaluation of factors affecting the ability to repay the majority of customers rely on credit scoring model to design model studies a