ASSIGNMENT 2 FRONT SHEET

Qualification BTEC Level 4 HND Diploma in Business

Unit number and title Unit 1: Business and Business Environment

Submission date 6/12/2023 Date Received 1st submission 6/12/2023

Re-submission Date Date Received 2nd submission

Student Name Do Thi Thu Huong Student ID BH01229

Class BA06303 Assessor name Ngo The Nam

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Table of Contents
I. INTRODUCTION........................................................................................................................................5
II. COMPETITIVE ENVIRONMENT (Five Force Model - 5F)...............................................................................5
2.1 Potential competition.......................................................................................................................................5
2.1.1 Barriers to entry................................................................................................................................................................ 5
2.2.2 Market exit barriers........................................................................................................................................................... 6
2.2 Current competition..............................................................................................................................................6
2.3 Substitute products...............................................................................................................................................7
2.4 Power of Suppliers................................................................................................................................................7
2.5 Power of Buyers....................................................................................................................................................8
III. 6 FACTORS (PESTLE) OF THE MACRO ENVIRONMENT................................................................................8
3.1 Political............................................................................................................................................................8
3.2 Economic.........................................................................................................................................................9
3.3 Social..............................................................................................................................................................11
3.4 Technology.....................................................................................................................................................12
3.5 Legal..............................................................................................................................................................13
3.6 Environment..................................................................................................................................................14
IV. INTERNAL ANALYSIS OF THE COMPANY TO IDENTIFY STRENGTHS AND WEAKNESSES..........................14
4.1 Core value, mission, or vision.........................................................................................................................14
4.2 Organizational structure.................................................................................................................................16
4.3 Human resources...........................................................................................................................................17
4.4 Brand name or brand equity...........................................................................................................................18
V. SWOT AND ITS RELATIONSHIP WITH INVESTMENT DECISIONS...............................................................19
VI. CONCLUSION...........................................................................................................................................22
References......................................................................................................................................................23
TALBLE OF FIGURES
Figure 1:Ranking of total bank assets in the first 6 months of 2023........................................................................................6
Figure 2: Vietnam's inflation rate over the years...................................................................................................................10
Figure 3: Organizational structure chart of VP Bank..............................................................................................................16
Figure 4: Number of employees of listed Vietnamese banks in 2022....................................................................................18
I. INTRODUCTION
Vietnam Prosperity Joint Stock Commercial Bank (VPBank) was established in 1993. After nearly 27 years of
operation, VPBank has developed a network including 1 headquarters and up to 227 transaction points with a
team of nearly 27,000 employees pellets. VP bank's vision and mission is to become a bank with a solid position
in the Top 3 largest banks in Vietnam and a scale in the Top 100 largest banks in Asia and always pioneer
innovation and improve quality. Outstanding financial services for customers and partners. This report will focus
on explaining and analyzing factors that can impact VP Bank as well as the Vietnamese banking industry. In this
report, Porter's Five Forces Model will be applied to evaluate the competitiveness among Vietnamese banks.
Next, PESTLE will analyze factors from the macro environment that can affect VP bank. Last but not least, SWOT
will be applied to see what are the current strengths, weaknesses, opportunities and threats of this
organization, and make recommendations to VCBF about investing in VP Bank.

II. COMPETITIVE ENVIRONMENT (Five Force Model - 5F)

II.1 Potential competition
II.1.1 Barriers to entry
There are a number of obstacles that new businesses must overcome in the banking sector. Some typical
obstacles are listed below:

Investment capital: The banking industry requires a significant amount of investment capital to establish and
operate a business. The new business needs to be able to raise capital from investors, banks or other financial
institutions to meet the capital requirements of the banking industry.

Regulation and compliance: The banking industry has many complex and stringent legal regulations to ensure
the safety and reliability of the financial system. New businesses must master regulations related to capital, risk
management, information security, anti-money laundering and comply with reporting and internal management
requirements.

Build trust and customers: New businesses must build trust and reputation with customers through providing
quality, reliable financial services and properly protecting customers' personal information. safe.

Technology and digital transformation: Technological developments and digital transformation are changing the
way the banking industry operates. New businesses need to invest in advanced technology to provide online,
secure and convenient financial services. They also need to be able to adapt to change and skillfully use
technology to compete in the market.
Enterprise capacity: requires financial management and banking operations capacity. This includes having a
management team with experience and in-depth knowledge of the banking industry, the ability to assess and
manage risks, and a strong grasp of internal regulations and processes.

2.2.2 Market exit barriers

Financial barriers: businesses need enough capital to cover debts, risks and other financial needs. Finding and
raising capital from investors or financial partners can be a significant challenge.

Regulations and legalities: The banking sector has many complex legal regulations. Therefore, to exit the
banking market, it is necessary to complete procedures related to agreements to cancel taxes and fees,
ownership rights and other binding procedures.

 Barriers to market entry are high, so competitiveness is low.

II.2 Current competition

VPBank operates in the banking industry, where there is high competition from other banks. The important
factor here is the number and strength of competitors, as well as the ability to compete in terms of products,
services, and scale. VPBank needs to evaluate how many other banks operate in the same market and their
competitiveness. Some banks are competitors such as: MB, Techcombank, ACB...

Source: vietnambiz.vn

Figu
re 1: Ranking of total bank assets in the first 6 months of 2023
About competitors VPbank competes with 2 large banks such as MB, Techcombank.... MB is one of the leading
joint stock commercial banks in Vietnam. In the group of joint stock commercial banks, MB continues to lead in
terms of total assets with 806,238 billion VND, an increase of 10.7% compared to the end of last year.
Techcombank is one of the largest banks in Vietnam, total bank assets have increased to 732,470 billion VND.
TCB is currently managing more than 300 trillion in customer assets, accounting for 50% of the market share of
high-income customers. Banks' competition with VPBank can affect both foreign and domestic banks. Foreign
banks can compete on new and innovative products and services to attract customers. Furthermore, foreign
banks often have financial potential and the ability to invest in advanced technology. This could create a
technological competition between VPBank and foreign banks.

 In the competitive pressure model, the pressure from VP bank competitors isextremely large.

2.3 Substitute products

The rise of financial technology (fintech) has created new financial tools and services, such as e-wallets, mobile
payments, and personal financial management through mobile applications. These fintech companies often
provide faster, more convenient and cheaper services than traditional banks, and can therefore compete
directly with VPBank products.

For corporate customers, the risk of being replaced by the bank is not very high because these customers need
clarity as well as evidence and invoices in the bank's product and service packages. If problems occur while using
products or services, this type of customer often switches to another bank for those reasons and will seek out
non-bank services.

For consumer customers, it is different. The habit of using cash is created for Vietnamese consumers to often
keep cash at home or, if they have an account, withdraw it all to use when they have money. Government
agencies and businesses pay salaries through bank accounts to promote non-cash payment methods,
contributing to financial transparency for each person. For example, customers can switch to buying life
insurance, replacing bank savings products, with both insurance benefits and accumulation and still enjoy
interest. This will inevitably affect the growth rate of commercial banks' market share (Dung, n.d.).

 Substitute products pose a moderate hazard.

2.4 Power of Suppliers

The Bank's suppliers include businesses, companies and customers. Suppliers such as software, hardware,
services, and infrastructure are also important. The bargaining power of suppliers is always high because there
are many banking options with the same quality of service for depositors as Vp bank. Therefore, they can easily
switch to another bank if the savings interest is high with negligible switching costs. Besides depositors, banks
also have another powerful supplier, their employees. In highly competitive sectors, adopting sophisticated
technology and a knowledgeable workforce is a must. VPBank needs to evaluate the negotiating power of
suppliers to ensure a stable supply source and reasonable costs.

 Therefore, the supplier power of VP bank is quite high, bank need to pay attention.

2.5 Power of Buyers

VP Bank has created many services suitable for many different customer groups, ensuring everyone can use the
best bank services. For each segment, buyer power is different. Customers will have the ability to negotiate and
offer many options for banking and financial services. Competitive pressure from customers pushes VP Bank to
constantly improve and innovate to meet and exceed customer expectations. The bank understands the
importance of providing a superior customer experience and strives to provide exceptional products and
services to maintain a competitive edge in the market.

 As a result, the buyer's influence on the company is moderate. Customer strengths for VP Bank can be
seen as both a challenge and an opportunity.

Opportunities: VPBank has many opportunities to develop in the banking industry, including leveraging
technology and digital transformation, enhancing personal banking services...

Threats: many large competitors, suppliers, limited human resources…

III. 6 FACTORS (PESTLE) OF THE MACRO ENVIRONMENT

III.1 Political
Vietnam is a country that maintains stability despite frequent fluctuations in the economic world. Vietnam
maintains strong growth, macroeconomic stability, managed inflation, significant energy balance, food security,
public debt and government debt have both decreased sharply... This achievement is also recognized.
maintained during the country's harshest period. COVID-19 outbreak in 2020-2021. Furthermore, a Russian-
Ukrainian war could occur. Dangers to the stability of financial and currency markets, energy security, food
security and global geopolitical challenges. Vietnam maintains its stance on macroeconomic stability, controlling
inflation, promoting growth, and ensuring major balances; The world has low growth and high inflation;
Vietnam has high growth rate and low inflation; Social security work is done well; Firmly protect independence,
sovereignty, territorial integrity and political stability. Besides political stability, the Government's policies bring
both advantages and disadvantages to the banking industry and VPBank, especially the decision to join the
World Trade Organization and the Free Trade Agreement between Vietnam and the EU.
By 2020, Vietnam has 30 strategic and comprehensive strategic partners; has diplomatic relations with 189/193
countries, economic relations with 160 countries and 70 territories. In particular, the WTO along with more than
500 bilateral and multilateral agreements in many fields, including 17 free trade agreements (FTAs) that
Vietnam participates in (15 agreements have been signed and are in effect). and two agreements under
negotiation) are large, multi-dimensional doors for Vietnam to orientate to perfect the institutional framework
for market economic development and confidently integrate into the world increasingly deeply, widely, fully,
and effectively more effective (Phong, 2022)

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is one of the major trade
agreements that removes trade barriers between 11 economies in the Asia-Pacific region, including Vietnam. In
the banking sector, participating in the CPTPP Agreement is an opportunity for expansion such as: Developing
markets abroad; receive support in consulting, training and fostering new knowledge from foreign banks and
financial institutions; Participate in a level and highly professional business playing field. Besides opportunities,
there are also many risks and challenges that require the banking system to constantly innovate, create, and
improve management capacity to not only stand firm, but also affirm its position regionally and internationally
(Khiem, 2019).

 Opportunities: Vietnam's banking industry has many opportunities to develop and increase company size
thanks to participating in trade and international agreements such as WTO and FTA.
 Threats: Vietnam's banking industry faces barriers to bad debt risks, technology crimes related to digital
transformation...

III.2 Economic
Vietnam's development in the last 30 years has been astonishing. The financial changes of the Doi Moi era,
which began in 1986, fueled rapid financial development, turning the least fortunate countries into lower-wage
countries. In 2019, Vietnam's GDP per capita reached over 2,700 USD, growing about 7%, nearly the same speed
as 2018 and one of the fastest growth rates in the district. The impact of the Covid-19 epidemic, global supply
chain disruptions, Russia-Ukraine tensions, war and other events have increased the cost of energy and basic
goods, causing persistent inflation. Inflation in 2022 Inflation is accelerating worldwide, setting records in
decades. However, Vietnam's inflation is still controlled thanks to the 2022 inflation rate increasing slightly to
3.21%.
 Source: dnse.com.vn

Figure 2: Vietnam's inflation rate over the years

Period 2011 - 2015

During this period, economic policies were applied in a harmonious manner. Specifically, tightening fiscal and
monetary policies, increasing production, encouraging exports and controlling imports... Thereby having a
positive impact on the economy and reducing inflation.

The inflation rate reached a record low of 0.63% in 2015. 0.63% is an astonishing number, the lowest inflation
rate since Vietnam started calculating inflation. According to the General Statistics Office, the main reason is
due to the sharp decrease in world gasoline prices, leading to a low inflation rate in 2015.

Period 2016 - 2020

The economy is strictly regulated so the inflation rate is always stable at 4%. 2020 is the year the Covid - 19
pandemic has complicated changes, strongly affecting the growth of different fields and industries.

From 2021 - 2022

In 2021, despite being affected by the Russia-Ukraine conflict and global supply chain bottlenecks during the
Covid-19 pandemic, Vietnam's inflation is still well controlled. With an inflation rate of 1.84%, Vietnam is a
"headwind" in the global high inflation trend.

Currently, Vietnam is among the few countries with an average inflation rate of 4-6%. In 2022, the inflation rate
will increase slightly at 3.21% (Thanh, 2023).
According to data published by the General Statistics Office, in 2020, despite a sharp decline in growth and most
economic indicators, Vietnam is among the rare countries that still maintain positive GDP growth. 91% (first
quarter increased by 3.68%; second quarter increased by 0.39%; third quarter increased by 2.69%; fourth
quarter increased by 4.48%); Inflation, although the highest in the past 5 years, is still within the range set by
the National Assembly.

Vietnam's stock market has overcome the "year of Covid-19" spectacularly, with a strong recovery, record high
liquidity, along with the strong participation of a new class of investors.

The whole country had 134.9 thousand registered businesses, down 2.3% compared to 2019, but the average
registered capital per business reached 16.6 billion VND, up 32.3%.

The combination of all the above factors shows that in 2021, our country's economy will maintain stability amid
the impact of the Covid-19 pandemic. The banking industry in general and commercial banks in particular will
continue to play the role of "athletes" supporting businesses and individuals to restore production and business
amid the impact of the Covid-19 pandemic (Thanh, 2021).

 Opportunity: Our country's development stage and GDP are still good. Due to good state control, with the
world economic situation, this is an opportunity for businesses to develop and increase revenue.
 Threats: Borrowing costs will increase with interest rates. This can raise finance costs and have an impact
on your ability to invest, grow or expand. Banks may have difficulty dealing with bad debts of businesses
in the context of the current economic recession.

3.3 Social
According to data published by the General Department of Population and Family Planning, as of December 31,
2020, Vietnam's population is estimated to be 97,757,118 people, an increase of about 876,000 people
compared to 96,903,947 people the previous year. In 2020, the natural population growth rate is positive
because the number of births exceeds the number of deaths by 945,967 people. Due to migration, the
population decreased by 69,492 people. The sex ratio in the total population is 0.997 (997 males per 1,000
females), lower than the global sex ratio. The global sex ratio in the world in 2020 is about 1,017 males per
1,000 females. This is a suggestion for commercial banks to keep in mind when developing policies to approach
customer groups.

Deloitte's 2020 survey shows that the trend of safe indoor consumption is clearly increasing when 62% of
Vietnamese consumers said they will eat at home often instead of going out to eat like before the pandemic
outbreak. Covid-19 epidemic. The market also witnessed rapid growth in cosmetic products when up to 87% of
Vietnamese consumers washed their hands regularly with soap. Besides, the survey results also show a
widespread shift to e-commerce in consumer trends by increasing the frequency of online transactions. More
than 50% of Vietnamese consumers have reduced the frequency of shopping at supermarkets, grocery stores
and markets, of which 25% have increased online shopping. Consumers, especially urban youth, have high
familiarity with digital technology and e-commerce.

Stemming from these general trends, online transactions through the banking system are a trend that
customers are interested in, especially young people. This requires the banking industry in general and
commercial banks in particular to improve regulations and technology infrastructure to better meet customer
needs (Thanh, 2021).

 Opportunity: The number of consumers grows with the population, giving banks access to a more talented
and diverse workforce. Banks can take advantage of these opportunities to develop markets and increase
revenue.
 Threats: Inequality can stem from differences in income and consumption between demographic
countries, putting pressure on banks to use services to meet diverse customer needs .

3.4 Technology
In banks, the technological environment can be seen as the source that shapes the way the world works. Every
year, the advancement of technology and its applications has created more advanced products that better meet
customer needs. Furthermore, technology application also helps organizations improve efficiency. According to
research by leading technology experts in the world, in the next decade, there will be 5 changing trends, which
are: (i) The profound impact of artificial intelligence (AI) through virtual assistant on devices such as smart
phones, smart speakers, televisions, refrigerators; (ii) Personal data has become a valuable asset and currently
social platforms such as Facebook and Google are giants holding these "oil fields"; (iii) Facial recognition
cameras are everywhere and China is the leading country in using this technology for security purposes; (iv) 5G
connection will open up easier, faster and broader connectivity for billions of devices in the future; (v) "Virtual
reality" is expected to replace Smartphones in the new decade through new applications such as: Glass, VR,
AR...

Under the influence of the Covid-19 pandemic, two emerging trends will reshape the way of doing business and
play an important role in helping businesses expand their operations in the competitive post-Covid-19 world:
non-cash payments and cloud computing services. The trend of moving to cloud platforms also occurs in
government operations. In order to limit the spread of the epidemic, many countries have accelerated the
process of digitizing administrative activities, building information portals and supporting the development of
national digital platforms.

Obviously, recent trends and major changes in technology require the banking industry in general and
commercial banks in particular to invest in technology infrastructure, upgrade system software and application
software for compatibility with the above changes. At the same time, recruit and train information technology
human resources in both quantity and quality to accelerate the digitalization process and build applications to
increase interaction points and enhance convenient customer experiences row.

 Opportunity: Technology helps banks easily find information, manage data, access markets and interact
with customers quickly and effectively, thereby increasing customer experience.
 Threats: Technology also brings information security risks to bank customers.

3.5 Legal
In 2020, there are a number of regulations related to banking activities in effect such as: (i) Circular No.
22/2019/TT-NHNN dated November 15, 2019 of the Governor of the State Bank regulating limits, Safety
assurance ratio in operations of banks and foreign bank branches; (ii) Circular No. 05/2020/TT-NHNN dated May
7, 2020 regulating refinancing for the Bank for Social Policies according to Decision No. 15/2020/QD-TTg dated
April 24, 2020 of the Prime Minister regulating the implementation of policies to support people facing
difficulties due to the Covid-19 pandemic; (iii) Circular No. 22/2018/TT-NHNN dated September 5, 2018 of the
Governor of the State Bank of Vietnam guiding on procedures and documents for approving the expected list of
personnel of commercial banks and non-governmental credit institutions. foreign banks and bank branches; (iv)
Circular No. 33/2013/TT-NHNN dated December 26, 2013 of the Governor of the State Bank guiding procedures
for approval of foreign currency cash export and import activities of licensed banks...

The 2020 Enterprise Law has notable new contents such as: eliminating regulations on notification of enterprise
seal samples before use; adding subjects not allowed to establish businesses, changing the concept of state-
owned enterprises. Thus, it can be seen that, with changes in new laws, new points in Laws such as: Investment
Law 2020, Enterprise Law 2020 will have the most impact on banking activities in general and especially New
circulars issued by the State Bank in 2020 require banks to update and adjust their internal regulations to
operate in accordance with State regulations. In addition, the EVFTA Free Trade Agreement effective from
August 1, 2020 is a big boost for Vietnam's exports, helping to diversify markets and export products, especially
agricultural products. , seafood as well as other Vietnamese products that have many competitive advantages.
This is a suggestion for banks to have interest rate policies for businesses in this field.

 Opportunity: Legislation protects brand value and prevents copying or intellectual property infringement.
 Threats: VPbank need to comply with legal regulations promulgated by the state in the banking sector. As
VP bank is a commercial bank, they must come into compliance with the law.

3.6 Environment
Environmental pollution is becoming a common problem for all mankind. Particularly in Vietnam, the current
situation of environmental pollution is at an alarming level, specifically shown as follows: soil sources are
polluted and become barren, lacking nutrients, unsuitable for plants; Polluted air environment causes acid rain;
shielding dust and smoke; increased greenhouse effect, in which in 2019, the pollution level in Vietnam reached
an average of 97, fine dust P.M 2.5, 3 times higher than the level prescribed by the World Health Organization
(WHO). with high pollution levels are Ha Tinh, Bac Ninh, and Hanoi; Water pollution is the most serious problem
in our country today, destroying living organisms in the water.

The Covid-19 epidemic began appearing in Vietnam from January 2020 until now, the total number of Covid-19
cases is 2,448 cases (as of March 1, 2021). Covid-19 affects all aspects of socio-economic life: The economy's
demand (consumption, investment, export) has decreased, thereby reducing production activities and growth of
the economy. economy. The Government's current measures are mainly aimed at stimulating aggregate
demand and restoring production. Regarding supply factors, the Covid-19 pandemic disrupted input and labor
supply chains.

Thus, with the effects of the environment and the impact of the Covid-19 pandemic, commercial banks need to
readjust their operating targets, research and develop loan products in the field. green energy, implementing
epidemic prevention and control measures in transactions, at the same time, applying interest rate policies to
support businesses, upgrading technology systems to facilitate online transactions. (Thanh, 2021)

 Threats: Climate change and resource management factors could affect credit risk and asset valuations.

IV. INTERNAL ANALYSIS OF THE COMPANY TO IDENTIFY STRENGTHS AND WEAKNESSES

IV.1 Core value, mission, or vision
Vision: To become a bank with a solid position in the Top 3 largest banks in Vietnam and in the Top 100 largest
banks in Asia, contributing to promoting the sustainable development and prosperity of the country and
community.
Mission: Pioneering innovation, improving the quality of outstanding financial services for customers and
partners, developing effectively and bringing sustainable prosperous values to shareholders, community and
society.

5 core values include: Aspiration, Integrity, Efficiency, Discipline, Creativity.

VP Bank's vision and mission are very consistent with the bank's characteristics and help the bank move in the
right direction, when the bank has properly focused on realizing its purpose and core values, at the same time.
while achieving significant achievements in building the community, customers and shareholders. The bank's
vision and purpose are very different and meaningful, demonstrating the bank's ambition and determination in
developing the bank and in business, bringing the best experience to customers through providing High quality
financial products and services, professional support and advice. The bank's actions also clearly demonstrate
those goals, including: the "Light up Vietnam" campaign to encourage the spirit and steadfast will of Vietnamese
people after the modern era. pandemic. The campaign includes activities of lighting up iconic buildings across
the country, giving savings books to orphans due to COVID-19, and free medical examination and treatment for
poor small businesses in many provinces and cities across the country. .

Besides the strengths of vision, mission and core values, VP Bank still has weaknesses. VPBank's vision can be
said to be too general and not specific. A more specific and clear vision can help decide on a more specific
strategy and direction. Although VPBank emphasizes innovation and creativity, it can be difficult to implement
and implement new ideas. Management processes can also hinder innovation and creativity. In general, VP
bank's vision and mission are consistent with the bank's characteristics and have helped the bank move in the
right direction. However, VP bank needs to continue to improve its vision and mission to achieve its set goals
and core values.
IV.2 Organizational structure

Figure 3: Organizational structure chart of VP Bank

VPBank has an organizational structure consisting of many departments such as: Board of Directors, Sales
Department, Risk Management Department, Accounting Department, Credit Department, Human Resources
Department, Communications and Marketing Department. Each department has its own function that
contributes to the development and success of the company.

Board of Directors: 01 Chairman, 02 Vice Presidents, 01 independent member, 01 executive member and 01
ordinary member are jointly responsible for leading and operating all activities of the bank.

The bank's business unit is divided into many different units:

Personal Business Department: This unit specializes in providing financial products and services to individual
customers. These can be deposit products, loans, credit cards, personal insurance products and investment
solutions.

Corporate Sales Department: This unit focuses on providing financial products and services to corporate
customers. These can include business loan products, import/export financing, cash flow management and
other financial solutions for businesses.
Finance Business Department: This unit focuses on providing more complex financial solutions and services to
large customers, including corporate finance, project finance, procurement finance and other financial services.
other special financial services.

Investment Banking Business Department: This unit is responsible for providing investment banking services and
solutions to customers. These can include asset management, portfolio management, investment consulting
and other services such as stock brokerage.

In addition to the above business units, VPBank also has other support units such as the Risk Department,
Accounting Department, Asset Management Department and many other units to manage the bank's
operations.

Accounting Department: Ensures the bank's financial management, accounting and financial reporting

Human Resources Department: Manage human resources policies, recruitment, training and employee
development.

Risk department: assess, control and manage risks related to the bank's business activities to ensure stability
and sustainability in business activities and protect the interests of customers and the bank.

However, due to its complex organizational structure and careful workflow, VPBank may have difficulty
responding quickly and flexibly to changes and unexpected situations. This is a weakness that VP banks need to
pay attention to. This can cause lost opportunities and create delays in adapting to the fast and changing
business environment.

IV.3 Human resources

According to the results of an annual survey on the best places to work in Vietnam, conducted by human
resources service provider Anphabe and market research company Nielsen, VPBank was honored as one of 5
businesses with happy human resources happiest in Vietnam. This is the first time Anphabe has included the
"Happy Human Resources" model in the survey. Accordingly, employees of a business are only "Truely Happy"
when they are connected to the company in both thought and feeling, which then turns into action with
support and attachment to the company.
 Source: nguoiquansat.vn

Figure 4:Number of employees of listed Vietnamese banks in 2022

In addition to being named one of the five workplaces with the happiest human resources, VPBank is also
honored to be ranked 26th in the list of 100 best workplaces in Vietnam, and one of four banks with the best
working environment best job.

It can be said that without a reasonable human resource management strategy and policy, VPBank would have
difficulty achieving such a high ranking. At VPBank, internal activities are regularly organized for employees to
participate, closely connecting departments and branches across the country from North to South. But the key
point for a bank to become a happy workplace is that the gap between generations in the bank is almost non-
existent. At VPBank, division directors and senior leaders are always encouraged to regularly organize activities
and participate with young people. That ideology has played a very important role in building corporate culture
and helping to shorten the gap between generations. The staff is well-trained and highly qualified, especially in
the banking sector. This is a notable strength of VP bank (vpbank, 2023).

However, the bank's human resource weakness is facing a serious shortage of human resources in building and
operating digital banks. According to bank leaders, the number of employees with enough vision, knowledge
and skills to meet digital transformation in Vietnam is not much, while training resources are still limited.

IV.4 Brand name or brand equity

Vpbank is one of the top 10 banks in Vietnam that is trusted and favored by everyone. This is a brand that has
been built and developed over a long period of time and VPBank is the only private bank in Vietnam in the top
250 most valuable banks globally. At the announcement ceremony of the Top 100 most valuable brands in
Vietnam 2023, according to the organizing committee, VPBank is one of four businesses with the highest brand
value growth in Vietnam this year.

VPBank's brand value is valued at nearly 1.3 billion USD by Brand Finance - the world's leading brand valuation
consulting company.

Thus, over the past 7 years, since Brand Finance first valued the VPBank brand at 56 million USD, the bank's
brand value has now increased 23 times.

Thanks to an increase of 32 places compared to 2022, VPBank's brand value has jumped to position 173 out of
the 500 banks with the highest brand value globally. This is also the fourth consecutive year VPBank's position
has improved in this ranking (L.Thanh, 2023).

VP bank owns a strong brand and has high brand value. This is one of the strengths that needs attention from
VPBank.

Besides, the bank is currently facing a number of scandals that have reduced customer confidence. For example:
A VPBank customer reported losing more than 2.1 billion VND in savings in his account. After sending the
payment request, the customer was "surprised" to learn that the entire amount at VPBank was transferred to 3
accounts at VietinBank, MB and BIDV. This is a weakness that VP Bank needs to pay special attention to to
regain customer trust.

V. SWOT AND ITS RELATIONSHIP WITH INVESTMENT DECISIONS

SWOT
VP BANK External environment (5F, PESTEL)
Opportunities:
1: There are many growth
opportunities in the banking
industry, including leveraging
technology and digital
transformation.
2: Vietnam's banking industry
has many opportunities to
develop and increase company
size thanks to participating in
trade and international
agreement.
3: Inflation and GDP are
controlled.
4: Consumers develop the
market, revenue increases.
5: Technology helps banks
easily find information, manage
data, access markets and
interact with customers
quickly.
6: The law protects brand value
and prevents copying or
intellectual property
infringement.
Threats:
1: Many large competitors,
suppliers, limited human
resources…
2: Vietnam's banking industry
faces barriers to bad debt
risks, technology crimes
related to digital
transformation...
3: Check borrowing costs have
increased in t’he context of
the current economic
recession.
4: Income differences between
demographic groups.
5: Technology also brings
information security risks to
bank customers.
6: Banks need to comply with
legal regulations promulgated
by the state in the banking
sector.
7: Climate change and
resource management factors
could affect credit risk and
asset valuations.
 Strengths:

1: Strong brand, high S-O Strategies:

brand value S1, S4, O1, O2, O3, O5
2: Was honored as 1 of 5 On October 20, 2023, Vietnam
businesses with happy Prosperity Bank (VPBank)
human resources. completed the transaction of
3: Clear organizational private placement of 15% of
S-T Strategies
structure on the roles and shares to Sumitomo Mitsui
responsibilities of each Banking Corporation (SMBC),
department. officially making the second
largest bank in Japan.
4: Core values, vision and becoming a strategic
mission are consistent shareholder to cooperate with
with the bank. VPBank.
Internal

Weakness

1: There is a serious
shortage of skilled human
resources in building and
operating digital banks.

2: Loss of customer trust

when depositing money at W-O Strategies W-T Strategies
banks.

3: Complex organizational
structures and
conservative work
processes, which can
make it difficult to
respond quickly

VP Bank has used its strengths to take advantage of its opportunities. Here are some important factors:
Vietnam's global integration brings many opportunities and developments for VP Bank to reach international
level. In addition, when inflation is stably controlled in Vietnam, this can create a more stable and easier
business environment for Vietnamese banks like VP Bank when they want to expand their business into the
market. other countries like Japan. When inflation is controlled, prices and interest rates increase more slowly,
which can help maintain stable loan prices and achieve growth targets in the 5-year development strategy
(2022-2026).

Competitive opportunities in Vietnam: VP Bank has built a solid foundation with the most modern digital
transformation technology, launching the best products and services. This will help the bank provide diverse
and high-quality products and services to the domestic market and will expand to other countries, meeting the
growing needs of customers. The bank has built a strong brand that is a strong private bank with a high level of
prestige and high profits.

In addition, thanks to the vision, mission and unbeatable value in 2023, Vietnam Prosperity Bank (VPBank)
completed the private placement transaction of 15% of shares to Sumitomo Mitsui Banking Corporation (SMBC),
officially making Japan's second largest bank a strategic shareholder to accompany VPBank in the upcoming
development journey. The offering agreement for SMBC is part of the capital increase plan implemented by
VPBank from 2022 to strengthen long-term financial capacity and help the bank achieve growth goals in the
third 5-year development strategy ( 2022-2026). Thanks to that, VPBank's total equity capital will be increased
from VND 103.5 trillion to approximately VND 140 trillion. The bank's capital adequacy ratio (CAR), according to
calculations by international credit rating organization Moody's, will increase to nearly 19% - leading among
banks in Vietnam evaluated by this organization. (Thanh, 2023)

VI. CONCLUSION
In summary, this report has provided analysis of VP Bank's banking environment through analyzing the macro
environment using the PESTLE framework and the competitive environment using the Five Forces model. Macro
environmental factors, including political, economic, social, technological, legal and environmental aspects, play
an important role in shaping the business landscape. Each factor has an overall impact on the overall business
environment and it also affects VP Bank in specific ways. Internally, the company's strengths and weaknesses
are determined by analyzing various factors. Core values or mission, organizational structure, human resources,
brand or brand equity Brand. These factors contribute to a company's competitive advantage or pose challenges
to its operations.

Furthermore, the correlation between the company's strengths and weaknesses with external macro factors
was explored. Through examining an actual business decision by VP Bank it demonstrates internal factors such
as core competencies and financial strength as well as external factors, including the macro environment and
competitive forces , affects the decision-making process. This analysis highlights the importance of aligning
internal capabilities with external opportunities and threats to make effective business decisions.

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