"Analyzing the quality of medium and long-term credit at TCB-Phan Xich Long branch"
Abstract
This thesis main purpose is to focus on the quality of medium and long- term credit, of Vietnam Technological and Commercial Joint Stock Bank- Phan Xich Long Branch. The main issues of Phan Xich Long Branch are the sudden increasing in bad debt ratio last year and a decrease in medium-long term credit performance in 2015. From 2011 to 2014, the, the outstanding loan keep increasing but suddenly drop in 2015, the main reason for this decreasing was because of bad debt recovery policy, and comparing to 2014, the total medium and long-term outstanding loan decreased 10.10%. One of the reasons for this decreasing trend is the overdue debt amount, which raised 16%, another one is the medium and long-term bad debt number, which increase 3.74% in 2015 comparing to 2014. By interviewing with the staffs, the author found out the main reasons for the cause of this bad performance in 2015: first of all, because overdue debt from past years had met the end of their payment periods. In some case, even the grant period was out of date, and these debts became bad debt in 2015 as a consequence. Moreover, the Vice- President of TCB PXL also admits that they not apply thoroughly the solutions to prevent the credits that have problem. Even though the branch conducted planning to meet with customers, but the plan was set up only when the debt had incurred problems. And another reason is stated by their President during the interviewing: their credit staffs had applied the credit provisions rigidly. When the overdue debt have not meet their payback time, they could also have some potential risks already, but during the process of inspecting and supervising, the manager did not ask their credit staffs to classify the outstanding loan so that they can think about the solution for each different levels of loan. However, the branch did show its effort in controlling the credit granted to firms. The number of bad debt that belong to group 5 has decreasing a great amount from 2013 to 2015, even though, it raise a little from 2014-2015, this amount still smaller than 2013. The decreasing of medium and long-term credit in 2015 is another result from the ineffectively in using capital, the turnover ratio were decent, but drop a little in 2015. In the end, the most important problem that the branch needs to focus in 2016 is to decrease the bad debt amount, and increasing the medium and long-term lending and
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collection amount. And its seem that aside from the unflavored economic situation, the staffs lack of ability is the most disadvantage that PXL branch is having right now, therefore increasing the staffs skills is necessary to raise the performance of this branch.