ANZ CEO sees changes in Viet Nam’s future

Saturday, April 19, 2008
CEO of Australia-New Zealand Bank in Viet Nam Dam Bich Thuy speaks with Thanh Nien about staying competitive in Viet Nam’s changing financial marketplace.
Many see banking as an easily “fruitful” endeavor. Is this true?
Dam Bich Thuy: The reality is that banking is not as easy as you may think. It is a risky business.
The idea that it is easy to gain huge profits in a short time is false.
After banking for a while, many bankers often reinvest in other highly lucrative industries.
Sooner or later, I think mergers and acquisitions will begin to play a much larger role in Viet Nam’s banking sector.

You say it’s not easy to profit in banking. However, Vietnamese banks’ financial reports show huge earnings.
It’s true that banks operating in Viet Nam are profiting.
But it should be attributed to the favorable conditions of the economy, such as its high growth rate, not to the easiness of the trade.
In the long run, if an economic crisis occurs, small banks with weak management will suffer.
Many big banks in the US have struggled since the real estate bubble burst.
In playing the high-risk banking game, high-level management capabilities are quite critical.
The increasing number of banks alongside a shortage in highly skilled workers is putting a lot of pressure on lenders as competition will grow stronger and market shares will shrink.
Like you say, competition in the banking sector is getting fierce. What does it take to be a winner in the banking industry?
The issue here is what factor can produce the best core advantages in a bank? I think the difference is their human resources.
A bank with a friendly, helpful and committed staff can satisfy customers even when the bank’s services are nearly the same as other lenders.
Banking is a rich breeding ground for professionals who are able to master high-quality customer service.
Vietnamese people are very fond of foreign companies. However, it seems that it is not true in banking services. Is there any conflict here?

With tangible goods, people can see and touch them and it is easy to judge the quality of the products after using them once.
For intangible services like banking, service quality is proven through people.
The modern setting of foreign banks’ offices may sometimes feel foreign to lower-middle class Vietnamese.
For me, a modern setting is not enough.
If you are a foreign bank with unsuitable services and you don’t know how to treat customers, then you’ll never be successful.
At ANZ, we combine a high level of service quality with staff commitment and a good command of cultural understanding to serve Vietnamese customers.
As we expand, ANZ will surely have a wide range of products for low-income customers and we will always maintain our image as a friendly bank.
In your opinion, what stands out as a landmark moment in ANZ’s establishment in Viet Nam?
In 1993, ANZ established its first ATM in Hanoi and it immediately transformed the area as people came from all over the city to use the machine, or even just to see it.
At that time, Vietnamese people were completely unfamiliar with ATMs.
Many people did not understand how the system worked and were curious to approach the machine and observe.
Now with more than 50 ATMs placed at the most convenient locations across the country – such as supermarkets, hotels, buildings across the country – ANZ’s ATM network is closer than ever to customers and it is still expanding.
What do you think of the pace of economic growth in Viet Nam and the future of banking here?
As Viet Nam integrates further into the world economy via the WTO, its own economy grows.
But as exports increase significantly, the country will also become more vulnerable to external shocks.
International trade is equivalent to 150% of Viet Nam’s GDP, according to Citibank, a striking figure that indicates just how large an impact a global slowdown would have on Viet Nam’s economy.
The pace of economic growth here very much depends on the government’s macroeconomic policies that may or may not ensure that we sacrifice all other things just for the sake of achieving high growth.
I believe 2008 will see lot of new macroeconomic policy introduced by the government to curb inflation and manage sustainable growth more effectively. (Thanh Nien)