Vietnam Technological and Commercial – Techcombank

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Joint Stock Bank (Techcombank) is currently one of the leading commercial banks in Vietnam in terms of total assets, loans, deposits and net income. It has built industry-leading franchises in retail deposits and SME and retail lending. In the 19 years since its establishment, it has developed a diversified range of financial products and services to cater to the financial needs of Vietnam’s 50 million strong labor force and 305,000 private enterprises.

Techcombank has successfully ridden the wave of financial liberalization and the ensuring rapid growth of the financial service sector in Vietnam to become one of the largest and most profitable banks in the country. Since the establishment in 1993, Techcombank has just set a simple aim of creating a profitable business that could contribute to Vietnam’s growing economy. Today, in 2013, the Bank’s targets are somewhat more far-reaching – to become the best bank and the leading business in Vietnam.

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The aim is to put Techcombank in the hearts and minds of the nation as the best and first choice bank. To achieve these aims, Techcombank has grown a highly capable and experienced management team who work closely with the board and supervisory committees to ensure the highest level of integrity and efficiency across our banking system. Good governance is the over-arching principle to ensure their success. Techcombank organizational structure is presented in the following chart: [pic]Techcombank shareholders meet at least one time per year.

The routine part of the general shareholders’ meeting includes approval of annual accounts, the election of the board of directors, and ratification of appointed auditors. In addition, shareholders can vote on proposals sponsored by management. Board of directors, the governing body of Techcombank of which members are elected by the general shareholders’ meeting, has full right to be on behalf of Techcombank to decide, exercise rights and obligations of Techcombank, except those which belong to authority of the General Shareholders’ meeting.

The BOD consists of 9 members, including Chairman of the BOD, First Vice Chairman, and 3 Vice Chairmen. All the BOD members are non-executive. Chairman and Vice Chairmen of the BOD are elected or dismissed by the BOD members with majority vote in the form of secret ballot or vote. A BOD term shall last 5 years. Office term of BOD members shall last no more than 5 years. The CEO board of management (BOM) is responsible for executing the Bank’s development plans and reporting on the performance status for the best interests of Techcombank.

The Board of Supervisor is a body supervising operations of the Bank in accordance with legal regulations and Charter of the Bank. The board of supervisor consists of 4 members including Head of the Supervisory Board, where half of the Board is executive member. The Audit Control & Compliance Department performs the Bank’s internal audit functions and reports to the Board of Directors and Supervisory Board. The Board of Directors (BOD) Standing Committee is established to enhance interaction and information exchange between the Board of Directors and the Board of Managers on operations of Techcombank.

It helps the Board of Directors be timely informed of the business performance of the bank, thus giving comments to support the Board of Managers in terms of direction. Audit and Risk Committee is responsible for some nomination and remuneration functions and duties relating to audit, verification, supervision and management of risks of banking operations as assigned/ delegated by the Board of Directors. Another committee established by the Board of Directors is the Nomination &Remuneration Committee. This Committee is in charge of performing some nomination and remuneration functions and duties which the Board of Directors assigns.

Besides the Head Office located in Hanoi, Techcombank also has Representative Offices in Southern region and Central region to control the operation of the bank’s nationwide branches. The Bank’s Governance is supported and enhanced by the activities of 4 divisions. Firstly, in order to establish a robust Risk management strategy, Techcombank has a separating Risk Division. This division specializes in providing businesses and management at different levels with more specific information on the Bank’s overall market risk to ensure the business safety and effectiveness of the bank’s operation.

Secondly, the Legal Division provides legal supports to the bank. And the other two governance divisions are Financial & Planning Division and Strategy & Development Division. The Executive Committee (EXCO), under the leadership of the Chief Executive Officer. It is through EXCO that the business of the Board is driven. EXCO develops strategy, refines it and delivers in a way to ensure implementation and achievement of business plans. EXCO ensures best practice implementation throughout the organisation and supports the board.

The Assets and Liabilities Committee (ALCO) is responsible for balance sheet planning from risk -return perspective including the strategic management of interest rate and liquidity risks. The Credit Risk & Problem Loan Management Committee is in charge of appraising long-term and medium-term projects, managing credit risk, market risk, and operation risk. The financial investment committee, the property investment committee, and IT investment committee play the role of providing consultancy for Board of directors in making as well as implementing investment plans relating to their fields.

The aims of marketing and branding division are introducing savings and current account products with superior features and added value to meet customer requirements at different stages in their lives; promoting insurance products and competitive money transfer services to increase the proportion of fee income generated by the PFS Division; developing bancassurance and structured finance products, particularly for Priority Banking customers; and developing a long-term loyalty program to bring added value to customers. The Transaction Banking Division is a product-focused business unit which provides services such as cash management and trade | |finance solutions to business clients. In addition, the division also provides transaction banking solutions through multiple | |delivery channels, including Techcombank’s internet banking platforms (F@st E-Bank and F@st-I-Bank), ATMs and SMS Banking.

With | |strengths of wide branch network, advanced technological platforms and so on, Techcombank’s Transaction Banking Division operates | |based on deep understanding of each customer’s needs and requirements. |The Cooperate Banking Division is organized with six sections: Deposit Section is responsible for maximizing profit from inactive | |capital by providing diversified products; Credit Section provides variety solutions through flexible and stable financing source;| |Monetary Management & Liquidity Section helps clients to manage cash flow effectively and on time; Trade Finance & Guarantees | |Section supports trading activities by effective financial solutions responding to all trade finance and payment needs;

| |International Payment Section provides fast and professional international payment service; and Foreign Exchange & Risk Prevention| |Section deals with defining risk management strategy for foreign exchange and managing properly exchange rate. | |Financial Institutions Division of Techcombank is in charge of licensing, examining, and investigating currency exchanges, credit | |unions, consumer finance companies, title insurance companies, and money transmitters. | |Techcombank established the Personal Financial Services Division in September 2007, based on 2 operations which are both | |specialized and linked with each other: namely product development and business development.

This segmentation aims to manage, | |implement and develop strategies in retailing and cooperating with partners. | |Human Resources Division aims include attracting, motivating, training and retaining the best talent in the market to continuously| |support the bank’s goals and mission; ensuring employees are fairly compensated based on their performance; designing benefit and | |work programs that allow employees to manage their needs; developing growth oriented leaders; and assisting The Board of | |Management on human resources matters. | |Commercial banking division covers all activities related to monetary management and commercial finance in Techcombank.

|Markets division researches the market, builds up and carries out business strategies of Techcombank by cooperating with Sales & | |Distribution division in operating and supervising the business activities. | |Sales & distribution division includes sales strategic planning, quality control and network development. The division sets sales | |targets and allocate to each region to supervise the implementation and management of ATM system. | |Operation & IT division provides support and develops technology products and services for the business activities of Techcombank. | |Besides, the division also participates in operating, implementing and supervising the Bank’s technology projects; and managing | |the information security systems of the Bank. |

This current organizational structure of Techcombank was first initiated in the middle of 2009, in which specialized divisions with separate functions and responsibilities were established based on a modern global bank model. The major difference is the creation of a specialized Sales and Distribution Division independent of the business and support functions. This allows Techcombank to develop better insights and thus effectively respond to the banking needs of each customer segment. As the first Vietnam bank to apply this model, Techcombank has demonstrated its determination to develop specialization and provide the best and most appropriate products and services to customers. Notes: There is no information about the product committee and the senior credit committee. It will be supplemented afterwards if possible.

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Vietnam Technological and Commercial – Techcombank. (2016, Oct 02). Retrieved from

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