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1. Overview of Sacombank1.1. The foundation of Sacombank

The Vietnamese transaction name: NGÂN HÀNG THƯƠNG MẠI CỔ PHẦN

SÀI GÒN THƯƠNG TÍN

The international transaction name: SAIGON THUONG TIN

COMMERCIAL JOINT STOCK BANK

Abbreviation: SACOMBANK

Headquarters: 278 Nam Ky Khoi Nghia, District 3 Ho Chi Minh City

Charter capital: VND 9,179,814,170,000.

Sacombank was established in December 21, 1991 on the basis of the

consolidated four credit institutions in Vietnam.

Officially established and came into operation on 21/12/1991, Sacombank’s

starting point was a small bank, which was found in the difficult period of the

country and used to operate mainly in Ho Chi Minh City.

1.2. The success achieved

Under the assessment of the financial group or organizations, reputable

magazines in the country as well as international bank, Sacombank was known as

one of the joint stock commercial bank leadings in Vietnam now. With the

relentless efforts of the business operations to bring the most practical utility, bank

has received many awards, certificates of satisfactory progress, merit critical nearly

17 years past. With the development orientation to become the regional bank, bank

aims to build a solid customer base through the deployment of separate product

lines and become a provider of private banking products trusted with specific

customer segments. In 17 years, bank has received many honors and prestigious

awards, notably:

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International titles

In 2010

1. January 2010: 2 Awards “Exemplary Efforts to Bring New

Card Payment Product and Services to Market Award” and “Visa Top five

clients 2005–2009 Award” voted by Visa.

2. March 2010: Award “Best Foreign Exchange Provider in

Vietnam 2010" by Global Finance

3. June 2010: Award "Best Retail Bank in Vietnam 2009" by The

Asian Banker

4. October 2010: Award "Best Cash Management Bank in

Vietnam 2010" by The Asset

In 2009

January 2009: Prize for "The Best Domestic Bank for Vietnam 2008" by The

Asset Organization – voted by Hongkong.

In 2008

1. January 2008: Award "Best Bank in Vietnam in the lending of small and

medium enterprises 2007" by the Fund for the development of small and medium

enterprises of the European Community (SMEDF) votes;

2. March and April 2008: 2 awards " The Bank has the best international

payment operations " by the Bank Of New York Bank, HSBC donated;

3. September 2008: Award "Best Bank in Vietnam 2008" by the Finance Asia

Organization poll - the United Kingdom awarded.

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In 2007

1. January, March, May, June 2007: 5 awards "The Bank has the best

international payment operations " by the bank HSBC, American Express,

Citigroup, Standard Chartered, Bank Of America awarded;

2. July 2007: Award "Best Bank in Vietnam 2007" by Euromoney – the

leading of world organization poll awarded;

3. November 2007: "Sacombank is the one of largest joint stock commercial

banks in the Vietnam and is the 4th largest bank in the banking sector in Vietnam"

by the United Nation Development Program (UNDP) reviews and ratings.

In 2006

1. January 2006: Award " The Bank has the best foreign exchange business

services in Vietnam in 2006" by Asia Money awarded through the votes of the

financial institutions in Asia Pacific;

2. March 2006: Awards "Best Bank in the lending of small and medium

enterprises in 2006 in Vietnam" by the Fund for the development of small and

medium enterprises of the European Community (SMEDF) votes;

3. May 2006: 2 awards "The Bank has the best international payment

operations " by financial groups Citigroup and Standard Chartered Bank awarded.

Domestic titles:

In 2008

1. January 2008: Certificate of Merit from the Prime Minister for

Sacombank’s collective staff in charitable activities for the community in 2007;

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2. June 2008: First Prize " Annual Report poll in 2007 " by the Department of

Ho Chi Minh City Securities Trading and Investment securities held with the

support of Dragon Capital

3. June 2008: Sacombank is one of the most favorite banking services by

Saigon Tiep Thi awarded;

4. October 2008: The flag emulation of the Prime Minister for the Sacombank

group for business activities of the Bank in 2007

5. June 2007: Award “ Strong brand Vietnam 2006 "by Vietnam Economic

Times and Trade Promotion Agency (Ministry of Commerce) held;

6. August 2007: "First Bank’s shares listed on the Vietnam stock market - the

Bank has joint venture fund management listed firstly on the stock market" by the

Center for Vietnam record book (VIETBOOKS) and Securities Trading Center Ho

Chi Minh City awarded;

7. October 2007: Award “The typical enterprise in Ho Chi Minh City in 2007

"by the newspaper Saigon Businessmen awarded;

8. November 2007: Award "The reputable quality of Vietnam Business 2007

by Market Research Centre Asia Pacific and the Ministry of Industry and Trade

selection;

In 2006

1. January 2006: Sacombank’s collective staff and employees have been

awarded by Governor of SBV for excellent achievement and contribution to

complete the task in 2005 Bank

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2. May 2006: Vietnam record "The bank has branches for women only in

Vietnam" by the HCMC Securities Trading Center and Vietnam record books

awarded;

3. June 2006: Award "Famous Brand in Vietnam 2006" by the Journal

Buniness Forum of VCCI Vietnam, Media Life Company (LIFE) and market

research company AC Nielsen Vietnam's implementation;

4. July 2006: Award “Vietnam Corporate’s Reputation - Quality 2006 "by

magazine advertising trade information Vinatax, Ministry of Trade and Industry

Ministry Central.

5. December 2006: The bank was assessed and graded A in the classification

table of the State Bank Vietnam in 2006 for joint stock commercial bank.

On 16/05/2008, bank created a new milestone in the history of formation and

development with the establishment of the Sacombank’s Bank Financial Group.

Currently, the Group financial participation of the members:

1.3. Members of Sacombank

1.3.1. Direct members of sacombank

- Saigon Thuong Tin joint stock commercial bank (Sacombank), the nuclear

role of coordination activities of the Group;

- Saigon Thuong Tin commercial bank securities (Sacombank-SBS);

Members of strategic cooperation

- Saigon Thuong Tin Commercial Bank financial leasing companies

(Sacombank-SBL);

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- Saigon Thuong Tin Commercial Bank remittance company (Sacombank-

SBR);

- Saigon Thuong Tin Commercial Bank debt management and asset

exploitation company (Sacombank-SBA);

- Jewelry Co., Saigon Thuong Tin Commercial Bank (Sacombank-SBJ);

1.3.2. Members of strategic cooperation

- Saigon Thuong Tin Investment Joint Stock Co (STI);

- Saigon Thuong Tin Real Estate Joint Stock Co., (Sacomreal);

- Tan Dinh Import Export JSC (Tadimex);

- Investment - Architecture - Building Toan Thinh Phat Joint Stock Company;

- Management investment fund in Vietnam JSC (VFM);

Sacombank has 03 prestigious foreign strategic partners holds nearly 30% of

share capital:

- Dragon Financial Holdings of Britain, to contribute capital in 2001;

- International Financial Company (IFC) under the World Bank, to contribute

capital in 2002;

- The Group Australia and New Zealand Bank (ANZ), capital contribution in

2005.

Sacombank has effective cooperations with other economic organizations at

both domestic as well as oversea such as Hoang Anh Gia Lai, Huu Lien A Chau,

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Truong Hai Auto, COMECO, Truong Phu, ISUZU Vietnam, Prudential Vietnam,

EVN, SJC, Bao Minh, Habubank, Military Bank, Baruch Education Group Ltd BVI

(BEG) ,City University of New York (CUNY)...

1.4. Organizational structure

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1.5. The special branches

1.5.1. Outside working hours transaction office

On 28/07/2008, Saigon Commercial Bank (Sacombank) officially opened a

trading room Cay Go (belonging to Binh Tay Branch) at No. 129A Minh Phung,

Ward 9, District 6, Ho Chi Minh City. This is the first-time outside working hour

transactions office of Sacombank, operating from 8:00 to 20:00 from Monday to

Saturday. Earlier, from10 / 7 to 26/7/2008, Sacombank also opened respectively

four transaction offices include: Lach Tray transaction office (Hai Phong), Lang

Cha Ca transaction office (Tan Binh), Chu Se transaction office (Gia Lai) and Chau

Doc transaction office (An Giang), bringing the total number of transactions of the

entire bank system up to 233 points in 45/64 provinces and one representative office

in Guangxi, China. Cay Go outside working hours transaction office of Sacombank

serves the needs of outside the working hours of the customers who are officials,

public employees, businesses and people in the area ... Minh Phung, District 6 and

District 11. Cay Go transaction office made all financial-banking services such as

receiving these types of deposits in dong, dollar and gold with attractive interest

rates, credit to many diverse forms and procedures fast ... fast money transfer

service in the domestic and abroad, a reasonable fee through a network of nearly

233 active transaction in 45/64 provinces throughout the country and to carry out

the following services: international payment, guarantees, payroll income

households, ATM services, trading and foreign exchange, oversea national currency

exchange and other financial advice ...

Occasion of the opening, Cay Go transaction office implemented the

promotions with incentives for customers such as free distribution of domestic

payment cards, a 50% service charge related to the student’s support products,

reducing 50% - 100% transfer fee system, free door collection of deposits from 300

million or more ... along with attractive gifts for customers in the transaction .

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1.5.2. Chinese-Vietnamese branch

Not only does Sacombank offer customers to the modern products of banking

services, professional service style, but also Sacombank seeks to explore the ways

to reach customers in an innovative way. And the formation of the Chinese-

Vietnamese branch of Sacombank also was originated from that idea , in order to

has the best services for the current Chinese customers, and attract new customers

who are from Chinses-speaking like China, Taiwan, Hong Kong, ..etc with the

products, services and room services which specific trait Chinese tradition.

Currently, Vietnam is considered one of the countries which is the most

attractive for foreign investment and neighboring country-China- as well as the

Chinese-speaking countries to foster the growing trade relations with Vietnam.

However, many investors have difficulty in language communication because

Chinese is not the common language of communication in the world. Besides, in

nearly all Vietnamese banks, service staff using the Chinese language is very

modest in which most of them know only Cantonese and Mandarin. Foreseeing

these problems, banks have quickly developed a model of branches which are

specialize to serve the customers using only in Chinese: from Mandarin, Cantonese,

... to Chaozhou, Fujian. Not only can the staff of Chinese-Vietnamese branch use

Chinese fluency, but they also actively cultivate knowledge of the traditions,

customs, Chinese culture to understand and serve customers in the most dedicated

ways. Additionally, all photos, uniforms, decoration, ... of Chinese-Vietnamese are

bearing Chinese culture. Chinese-Vietnamese branch officially went into operation

in 08.10.2007 at 382A-B Tran Hung Dao, District 5, Ho Chi Minh City, which

dedicated to those serving overseas the Chinese for more than 500,000 people are

living and working in the city. HCM, which is up 30% of Chinese business

ownership. The birth of the branch was again marked by outstanding step in the

strategy to target the specific model of banking. Chinese-Vietnamese branch not

only meet all the demand of these products, banking services like other branches

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throughout Vietnamese bank system, but the branch also has the exclusive products

that is only in the Chinese-Vietnamese branch.

1.5.3. March 8 Branch (8/3 Branch)

In the current era, the role of women in the modern society is increasingly

being raised. The women not only give the thoughtful care to the family happiness,

but also are very successful in social activities. As a result, it’s undeniable for the

progress of women as well as their positions that are worthy to respect. With the

hope for confirm the advantages of modern women today, especially for the

emphasis on the role of "financial management" in the family, Saigon Commercial

Joint Stock Bank (Sacombank) had formed these ideas and built successful banking

model which specifically dedicated to women with a meaningful name: Sacombank

March 8 Branch. The first branch was officially opened and to work on Ho Chi

Minh City’s financial markets on the meaningful time 08/03/2005. March 8 Branch,

in addition to providing all the products and services like that the other branches in

the entire system, March 8 Branch also study the needs, interests and habits of

customers to form the typical product or services for customers like Au Co deposit

accounts, First Ladies credit cards, ... Interestingly, the main impression used to

attract customer for this branch is: the entire staff, employees and customers are

women. It also has made a big difference in the business of the Sacombank

compared to other banks. With a team of young female staff which has energetic,

enthusiastic and professional service, 8 March branch always works hard and

commit to offer customers the best utility of financial services.

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2. Current situation of Sacombank activities

2.1. The financial situation of the bank

2.1.1. The Sacombank’s network

In 2009, the bank has established 96 new branches and 46 transaction offices,

which bring the total number of transaction offices up 310 points in 46 provinces

and cities throughout the nation, and these systems continues to be a leading of

entire Vietnam commercial banks system on the scale of network transactions.

2.1.2. Sacombank’s charter capital

By the end of 2010, the charter capital of Sacombank reached 9,179 billion

VND which climbed to 37% over the previous year and increased 18 times

compared with 2004, obtained an average growth rate of 56% per year to take

continuously a lead of entire Vietnam commercial bank system on the scale of

equity.

Figure 2.1.2: Charter capital of Sacombank from 2004 to 2010

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2004

2005

2006

2007

2008

2009

2010

505740

1250

2089

4449

6710

9179

2.1.3. Sacombank’s total asset

By the end of 2010, total asset reached 146,000 billion VND, increased to

48% compared to last year and was higher 20 times than that of 2004, with

profitability of asset reaching to 85%.

Figure 2.1.3: Total assets of Sacombank from 2004 to 2010

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2004 2005 2006 2007 2008 2009 2010

730410395

14454

34776

64573

98648

146000

2.1.4. Capital mobilization

The remainder of capital mobilization, by the end of 2010, obtained 129,000

billion VND, went up 50% from last year and exceeded on 64% of the plan,

including funds which entrusted by the foreign financial institutions, reached 2325

billion VND.

Figure 2.1.4: Capital mobilization of Sacombank from 2004 to 2010

2.1.5. Loan and debenture

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2004 2005 2006 2007 2008 2009 2010

64359176

12260

21338

55692

86000

129000

Total outstanding loans in 2010 was 80,000 billion VND, witnessed 45%

upward over the previous year, including individual loans, households accounted

for 49%. In addition, Sacombank also adjusted the 19.4% of total assets into

debenture to reduce risk, create more profitability and flexibility of the bank

liquidation

Table 2.1.5: Total outstanding loans and its growth rate of Sacombank

from 2004 to 2010

Year 20

04

20

05

20

06

20

07

20

08

20

09

20

10

Total

outstanding

loans

4,

729

5,

986

8,

425

14

,394

35

,378

55

,172

80

,000

Gro

wth rate

0

%

2

7%

4

1%

7

1%

14

6%

5

6%

4

5%

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2.1.6. Business’s result

Profit before tax was 2,400 billion VND in 2010, with 132% of the plan and

up to 26% compared to the previous year.

Figure 2.1.6: Profit before tax of Sacombank from 2004 to 2010

172004 2005 2006 2007 2008 2009 2010

0

500

1000

1500

2000

2500

125

198

313

611

1528

1905

2400

2.1.7. Investment activities

Sacombank not only enhances addition equity for companies under

Sacombank, but also be interested in the investment securities fund through capital

contribution or share purchasing to in the business potential to diversify the

portfolio to reduce risk, and improve efficiency .

In 2010, international payments of Sacombank reached $ 3048 million, went

up to 59% over the previous year in which exports payment witnessed $ 401.7

million upward trends, up to 119% over the previous year and import payments

reached $1693 million, went up to 59% over the previous year. Domestic sales

payment obtained 536,561 billion VND, up to 36.6% over the previous year.

On a financial index (based on independent of SBV’s audit reports)

- Rate of return on total equity (ROE): 39.16% (plan> 30%).

- Rate of return on total assets (ROA) : 2.91% (plan> 2%).

- Capital adequacy ratio: 11.07% (defined> 8%).

- The percentage of short-term capital funds for long-term loans: 25.50%

(defined <40%). ---- Rate of loan on capital mobilization: 62.63% (plan = 65%)

- Overdue debt ratio: 0.39% (plan <2%).

2.2. Current situation of Sacombank’s Human resources Department

In late 2006, Vietnam officially joined the WTO. Integration process makes

the domestic companies to face pressure in all aspect due to the open economy.

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Vietnam receives more foreign enterprises to compete with many remarkable

competitive advantages. In the field of human resources attraction, the advantages

of foreign firms are high salary, good promotion in which the domestic companies

are unable to compete. Besides, from early 2007 until now, with the warming of the

banking and financial markets, especially stock markets, plus the advent of massive

banks, consulting firms and business investment securities, businesses, especially

"shortness of breath" of banks in attracting and maintaining human resources,

leading to fierce competition on the labor market on wages, regulations and policies

preferential treatment, while creating a wave of staff moving between businesses.

In such circumstances, the leadership always clearly identifies the importance

of human resources as well as employment policy to maintain a young, dynamic,

creative, but also full of skill and experience. As an illustration, a total of

Sacombank’s staffs in end of 2009 was about 5470 people, including 2802 women

and 2668 men.

The intelligentsia staffs take over 77% of Sacombank’s human resources from

Intermediate level and above:

- Doctor: 1 (male)

- Master: 47 (female 13)

- University: 3224 (female: 1701)

- Colleges and Secondary level: 970 (678 female)

Sacombank's human resources personnel are young, bravery, experience:

- Under 30 years: 3906 (2209 women)

- 30 to 40 years: 1311 (497 women)

- Over 40 years: 253 (female 96)

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To maintain staffs, The governor of the Bank is always interested in

improving the quality of life of staffs: Annual salary increases are considered

relatively high rate (on February 2009, a number of staff positions is increased to

50% of salary), with holiday‘s bonus like 30/04, 1 / 5, 2 / 9 and the end of the year

In addition, Sacombank also has other remuneration such as mortgage credit,

vacation, tourism, health care, community activities.... At the same time,

Sacombank always interested in staff’s career orientation by building personnel’s

legacy, regularly training for employees at all levels from managers to employees in

order to improve the quality of human resources, gradually forming staff’s

competence and experience step by step, undertaking common task to become "the

best multi-functional retail bank in Vietnam" of Sacombank. Thanks to those

policies, despite intense competition for such personnel, the rate of employees who

quit the job due to dissatisfaction had decreased from 12.6% in 2007 to 7.6%.in

2009.

2.3. The community activities of the Bank

Customer-oriented in business and community-oriented in social activities is

always the guiding principles of the bank actions to contribute to happiness and

prosperity to the country. Sacombank has a lot communities programs such as:

"Sacombank - nurture the dream" is a scholarship program for poor pupils and

students each year at a cost of billions which is extracted from the welfare fund. The

program which began in 2004, has now awarded thousands of scholarships to

individual pupils and students throughout the country and has received many

supporting comments, praise from the community. The scholarship "Sacombank -

nurture the dream" reflect the concern, support and encouragement of the leader as

well as collective staffs of Sacombank to the poor pupils and students. Particularly

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in 2009, the bank has given nearly 2,000 scholarships in which each is worth $ 1

million for pupils and students in 44 provinces across the country.

The running cross-country named as "Run together with Sacombank for public

health" in 2008 have been implemented in 44 provinces with a total cost over 5

billion VND, which attracted the participation of more than 40,000 athletes who are

pupils, students and staff of organizations, departments, associations, unions……

The main purpose of the program is to contribute to the local authorities and

provinces in promoting competition to improve health in life. Besides, in order to

create infrastructure for recreation and community activities, Sacombank spent

more than $ 1.2 billion budget for the donated benches for the community in all

provinces.

These activities have been implemented since 2003 and it is being continued

to maintain over the coming years.

There are also many other activities, the bank such as "On charity Tet",

"Sacombank – speak for thanks" ... .

3. Goals and Direction of Banking Operation in next time

3.1. Assessing the situation of the Banking

3.1.1. General situation of economy

3.1.1.1. Market demand

Despite high inflation, Vietnam's economy is still on growth in which incomes

and living standards of people are improved so that the accumulating demand for

savings is a leading key factor concern of most people.

In 2010, Vietnam has established a new economic zone such as economic

zone of Hai Ha - Quang Ninh, Dong Nam - Nghe An, Hon La - Quang Binh ....

These place which attract huge investment, are opportunities and growth potential

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of financial services to banks. The banking services will grow stronger in the export

processing zones and industrial zone.

3.1.1.2 . Competitive pressure

The banking sector continues to innovate the mechanism according to

international practices and standards to meet the requirements of integration. The

foreign banks in Vietnam will appear more, which is established by economic units

with strong financial resources and create the growing competitive pressure in many

ways, the level. According to the schedule of WTO, Vietnam will have the

appearance of the banks with the 100% foreign capital, which will create

competition in the financial-banking sector. However, it also is a catalyst for the

development of domestic banks when the banks have to find the way how to survive

in the cut-throat world such as some commercial bank seeking to expand rapidly the

network of new products and services to attract customers.

3.1.2. Evaluating the Sacombank’s activities

3.1.2.1 . Strength

Sacombank is considered as one of the banks which own the large scale of

capital with the reputable leader in banking and financial sector in Vietnam.

Sacombank’s brand has been spread throughout the domestic market and also has

been reaching to international markets. Sacombank has retail networks covered all

provinces and cities in the nationwide. The bank still continue to bridge the

relationship with customers increasingly and establish the relationships with several

strategic domestic partners as well as that of abroad. Furthermore, Sacombank

strengthen a contingent of young, capable and dedicated staffs to carry out the

business goals and direction in the future development of the Bank.

3.1.2.2 . Weakness

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Uniformity of development and governance requirements under the system are

not really parallel so that the Bank has not achieved the best performance as

expected in the business activities in the context of the banking sector which is fast

growing in recent times. Growth of the economy with high competitive pressure,

especially the financial-banking sector so the professionalism of staffs are not the

highest in the sales department.

3.1.2.3 . Opportunities

Economic growth and stability is high in which macroeconomic policies on

economic development with its open and integrity create more opportunities for

business. Economic integration facilitate the broad cooperation with other

organizations and international financial institutions to improve management skills,

capital sources and joint ventures for investment and business development and

brand reputation. In addition, consumption demand is growing as its population and

the product of bank services are interested more and more people. However,

majority of the population may not fully approach to these banking activities as well

as other banking products, and many small and medium enterprises is not fully

accessible to the bank's capital. Therefore, the chance for Sacobank to attract the

potential customer is still high.

3.1.2.4 . Threat

Human resource’s high qualified and experience are increasingly rare and

fierce competition among banks, along with other financial institutions and other

economic. The need for using the services and banking products is concerned more

and more by people with high demand of diversity, products and services quality. In

addition, several economic organizations with strong potential financial participants

establish new branch in Vietnam so that these new participants will lead to create

pressure for strong competition in the future.

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3.2. Business objective in 2011

3.2.1. Common goal

The achievements in 2010 and previous years created a basic foundation for

the Bank with the forming of comparative advantage for Sacombank. As a result,

the goal for 2011 is to continue to accelerate bank, safe and stability of bank, which

conducted comprehensive restructuring items of Bank activities, including

restructuring the legal framework, restructuring activities and capital restructuring,

using efficiency, safety and sustainability capital.

Also, banks offer feasible solutions and innovation, along with the schedule

and route taken to overcome those limitations and the comings of inadequate that

we already have identified, analyzed and assessed.

3.2.2. Specific objectives

- Perfect a new restructuring model the bank and put it into operation

effectively, improve and maximize the potential of collective management staff and

all staff,

- Continue to improve banking technology as well as regulations and

procedures,

- Promote investments through subsidiaries, joint ventures, cooperation,

association, capital contribution,

- Develop constantly new products and services,

- Diversify structure of using capital and enhance role of risk management

activities of the Bank,

- Improve the business relations of coordination among Bank units,

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- Develop the processes and implement the effective management of operating

costs to the system to raising the efficiency of business operations,

- Improve competitiveness through training, administration skills, reasonable

reward mechanisms to make the engine of growth,

- Continue to develop network activities.

In 2011, Sacombank will open 14 additional transaction in the country, the

two branches of Laos and Cambodia and a representative office in China (launched

on 08 / 01 / 2008), which bring the total number of Scombank transaction office in

the end of 2010 is over 470 points with the presence in 54 provinces and cities

across the country and three neighboring states.

3.2.3. Financial objective for 2011

- Charter of 2011 to reaches about 6,494 billion VND, up to 46%,

- Total assets reaches over 93,000 billion VND, go up 46% over the previous

year,

- Total capital mobilizes over into VND 80,000 billion, up to 45%,

- Total outstanding loans reaches 45,000 billion VND, up to 30%,

- Pre-tax profit of banks reaches more than 1,800 billion, up to 24%.

Some objectives of quality financial activities in 2011:

- Capital Aquadecy Ratio (CAR): 11% - 12%

- The ratio of profit on average total assets: 2% - 2.5%

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- Rate of return on average total equity: 29% - 30%

- Overdue Debt Ratio: <2%

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