Credit Risk Management of Selected Coop Bank Branches’ PCFs in the Northern Provinces of Vietnam

Abstract

This study was conducted to propose a guideline to strengthen People’s credit funds’ credit risk management practices. It includes their demographic profile in terms of a PCF’s lending introduction (human resources, operational areas, roles, capital sources for lending, overdue debt ratio and earnings), the State Bank’s prudential ratio practices of PCFs. The study also aims at PCFs’ credit risk management practices, determination of significant differences in respondents’ assessment on credit risk management when grouped according to profile and the impacts of credit risk identification, measurement, monitoring and handling on credit risk management. The data of the research include both primary data (questionnaire) and secondary data (CoopBank’s and PCFs’ reports, article, SBV’s documents...). They are processed by interpreting the secondary data and analyzing primary data using SPSS (frequencies, mean computation, descriptive and ANOVA...). The findings are that: Generally, PCFs’ credit risk management is good. However, a small number of PCFs have some violations in SBV’s prudential ratios. Therefore, it needs close cooperation in SBV’s and CoopBank’s supervisions, inspections and PCFs’ own internal controlling and audits. The recommendation is hoped to work on well to strengthen PCFs’ credit risk management practices and mitigate credit for PCFs’ sustainable development.