finance & business news 8 March 2018 FINANCE . 1 VN packaging industry set for growth 26 Reference exchange rate down for second consecutive day 1 Is the home appliance market becoming saturated? 27 Moody's: Vietnam banks show widening divergence 2 How do e-commerce businesses overcome difficulties? 28 Banks race to attract deposits 3 Developers marching down to the riverside 28 Significant progress made in sustainable lending reforms 4 Honesty as the best marketing policy 30 Payment services: fierce competition in market share 4 PM directs boosting support for enterprise development 31 Bank cards carrying dozens of fees 6 Vietnamese startups: the other side of the coin 32 Higher power tariff for crypto mining 7 MARD helps small farmers find vendors 33 A shake-up in key bank personnel 7 Changing retail landscape and the rise of shopping malls 34 List of banks to make no dividend payment lasts longer this year 8 Industrial zone developers: High time for action 34 Small banks holding breath for upcoming AGMs 9 Central key economic zone invites US investors 36 VN important part of Japanese bank's 'Asia-centric' strategy 10 Foreign farmers pour investments in Da Lat 37 Japanese bank signs cooperation agreement with Vinh Phuc Sweden expects to cooperate with Vietnam in water treatment 38 province 10 BIZ NEWS . 38 VPBank shares granted with margin after 6 months 11 Business Briefs 08 March, 2018 38 Vietnam needs to capitalise on CPTPP agreement 11 VN Index loses 8 points on March 7 39 PM wants early-warning system for macro-economic risks 12 March 7: Volatile afternoon as all main indexes down 39 To the next step 13 PV Oil begins trading shares on UPCoM 40 FDI in Vietnam's agricultural sector remains low 15 Part of visa fee revenue for tourism development 40 Hard for Vietnam to sue US over steel, aluminum tariffs 16 Eastern North-South Expressway feasibility study to be MoIT imposes safeguard measures on imported fertilisers 17 approved in August 41 Foreign car makers try to navigate new law in Vietnam USD5bn to be spent on Can Tho-HCM City express railway 41 after two-month hiatus 17 More Vietnamese businesspeople seek second citizenship 42 Coastal localities report bumper fishing catches 18 Amazon due to penetrate Vietnam E-Business market 42 Ministry of Finance works to handle tax arrears 18 FLC to purchase 24 aircrafts worth $3bn 43 Aviation development plan changes for sustainability Vietnam Airlines to open Nha Trang-Seoul route 43 in the future 19 Two Korean retailers to partner with VN 44 Transport a highlight of GMS Economic Cooperation Programme 21 Zalo Shop partners with Shipchung and BoxMe 44 Nearly $1.2 billion invests in major agricultural projects 22 Road to success of three Vietnamese women with essential oil 45 Vietnam, Good Neighbours International work to improve HCM City court stalls Grab trial after reopening hearing cooperatives 23 for one day 46 Hanoi to create transparent environment and investment Innovation in dire need at Mekong Delta startup contest 47 for the private sector 23 Vietnamese businesses to attend IE Expo China 2018 47 Quang Ninh: customs clearance via floating bridge linking Chinese firms keen on VN's environmental protection market 48 with China 24 International furniture expo opens in HCM City 48 Bright horizons for resort property development 24 Rural areas boast rapid growth in FMCG 25 FINANCE FINANCE Reference exchange 08/MAR/2018 INTELLASIA| VNA rate down for second The State Bank of Vietnam set the daily reference exchange rate at 22,443 VND/USD on consecutive day March 8, down 10 VND from the previous day. With the current trading band of/-3 percent, the ceiling rate applied to commercial banks during the day is 23,116 VND/USD and the floor rate 21,772 VND/USD. The opening hour rates at major commercial banks also showed a declining trend. Vietcombank cut both rates by 5 VND, listing the buying rate at 22,720 VND/USD and the selling rate at 22,790 VND/USD. The rates listed at BIDV went down by 8 VND, standing at 22,720 VND/USD (buying) and at 22,790 VND/USD (selling). Intellasia Tel: +844 2213 2244 No. 21, lane 173/63/17, Ngoc Ha Ward, Ba Dinh Dist, Hanoi Fax: +844 3759 2034 © All Rights Reserved Email: [email protected] Websites: www.Intellasia.Net www.TriTueAChau.com Vietnam finance & business 8 March 2018 Meanwhile, the rates listed at Vietinbank dropped by 49 VND to 22,676 VND/USD (buying) and 22,746 VND/USD (selling). https://en.vietnamplus.vn/reference-exchange-rate-down-for-second-consecutive- day/127551.vnp Moody's: Vietnam 08/MAR/2018 INTELLASIA| THE SAIGON TIMES banks show widening Moody's Investors Service in a recent report said that business results of Vietnamese divergence banks in 2017 show a widening divergence in asset quality and profitability. According to the firm's just-released report, the 2017 results for the 14 Vietnamese banks rated by Moody's show that asset quality improved moderately year over year. Profitability also improved, driven by robust macroeconomic conditions and growth in core income. By contrast, capitalisation deteriorated because of rapid asset growth and cash divi- dends. However, the banks' funding profiles weakened mildly, as they increased their FINANCE reliance on market-sensitive liabilities, mainly borrowings from other banks, to fund loan growth with cheap short-term funding sources. "For 2018, we expect that the banks will continue to improve their asset quality and profitability, while capitalisation will weaken," said Eugene Tarzimanov, a Moody's vice president and senior credit officer. However, Rebaca Tan, a Moody's analyst, said the credit profiles of banks with strong- er capital buffers and lower asset risks would be further distanced from the other banks. On asset quality in particular, Moody's said that the improvement in 2017 versus 2016 was helped by problem asset recoveries and write-offs, as well as credit growth. The asset weighted-average problem loans ratio at the 14 rated banks fell to 5.7 percent at the end of 2017 from 6.7 percent the year before. Notably, four banks fully wrote off Vietnam Asset Management Company bonds that they had received in exchange for problem assets, and Moody's expected more such write-offs in 2018. Problem loan coverage ratios also improved, although they are still at levels that are weak by international standards. Moody's said that the banks' asset quality will im- prove further in 2018, due to recoveries, but rapid credit growth could mask asset risks. With profitability, Moody's pointed out that the banks' asset weighted-average return on assets rose to 0.9 percent in 2017 from 0.7 percent in 2016. Profitability will continue to improve in 2018, on the back of the same factors that drove up profitability in the prior year, in particular, robust macroeconomic condi- tions and growth in core income. As for capitalisation, the asset weighted-average ratio of tangible common equity to to- tal assets for the banks slipped to 5.5 percent in 2017 from 5.7 percent in 2016, pres- sured by declines at State-owned banks, in particular. Nevertheless, some banks, such as Vietnam Prosperity Commercial Bank (VPBank), Vietnam Technological and Commercial Bank (Techcombank), and HCM City Devel- opment Bank (HDBank), strengthened their capital bases through the sale of new shares. Moody's expected that more Vietnamese banks would increase capital by issuing new shares in 2018. However, overall capitalisation levels will remain under pressure over the next 12 months from credit growth and dividend payments. Moody's explained that in terms of funding, the banks' funding profiles weakened moderately, as seen by the system-wide asset weighted-average loans-to-deposits climbing to 86 percent in 2017 from 85 percent in 2016. This trend could continue in 2018 because loan growth remains rapid. english.thesaigontimes.vn/58650/Moody percente2 percent80 percent99s-Vietnam- banks-show-widening-divergence.html Intellasia 8 March 2018 2 / 49 Vietnam finance & business 8 March 2018 Banks race to attract 08/MAR/2018 INTELLASIA| DTCK deposits On the very first days of working after Tet holiday, the market witnessed numerous deposit rate promotions within two to three days. However, that is only the starting point for the race in mobilisation among banks which is becoming increasingly attrac- tive. High interest rates and good promotions are still the tools that overwhelm the so- called "service quality". Some banks assigned employees to call customers and notify them that they would en- joy interest rate of up to 8 percent per annum if depositing money on 12-month term, while the rate was only 7.4 percent per annum on the same term not long ago. In addition, many banks have launched promotional programmes to attract deposi- tors. HDBank is offering a bonus deposit rate of up to 0.7 percent per annum. Mean- while, from now until April 30th, when opening Mang Non or Ong Vang savings book at Maritime Bank, customers will have an additional effective way to make their finan- cial plan in the Year of Dog and immediately receive a lucky money. FINANCE Will lending rates fall when mobilisation gets hot? There is a worth mentioning story in this race of mobilisation, that is when using inter- est rate as a tool to attract capital, bank will not be able to lower mobilisation costs and strive to reduce the cost of lending as directed by the government and the State Bank of Vietnam (SBV). In 2018, SBV aims to increase total means of payment by about 16 percent and lending by about 17 percent.