VID Public Bank is a joint venture bank between Bank for Investment and Development of Viet Nam and Public Bank Berhad, Malaysia. The Bank was established in May 1992 and after 19 years in operations; it now has one Head Office and seven branches in major cities of Viet Nam.

Being the first joint venture bank in Vietnam with enthusiastic & well-trained staff force and enormous support from Public Bank Malaysia in term of management skills, VID Public Bank has been one of the most profitable and prudent banks in Vietnam. However, given the early stage of development of financial markets in Vietnam, management of Vietnamese banks in general and of VID in particular still falls behind world’s best practices.

In 2008, facing the fluctuation of market interest rates and the effect of global financial crisis, the Bank has shown several weaknesses in business and risk management. Especially, the Bank’s mismatch between asset and liability in term of volumes, maturity and interest rate due to its lack of proper bank-wide Asset-Liability Management (ALM) was the main reason of profit decrease in the first 6 month of 2009. These and many other situations showed that VID Public Bank needs to re-examine, reassess and improve its asset and liability management in order to enhance the risk-return profile of the bank’s portfolio, thus maximize two main targets of ALM, namely the interest income and the net present value of assets minus liabilities. The thesis attempts to address these issues.

. The thesis structure

Introduction

Chapter I: Theoretical Framework

Chapter II: Asset and Liability Management at VID Public Bank

Chapter III: Empirical Results and Economic Analysis

Chapter IV: Recommendations to improve Asset and Liability Management in VID Public Bank

Conclusion