06. Message from the Chairman of Board of Directors. 22. Organizational Structure during

Transcription

1 ANNUAL REPORT

2 ENDLESS FAITH

3 06. Message from the Chairman of Board of Directors YEAR JOURNEY 16. MB NETWORK 22. Organizational Structure during Business Goals & Development Strategy for Risk management 24. MEMBERS OF BOARD OF DIRECTORS &SUPERVISORY BOARD 32. MEMBERS OF Board of Management ANNUAL REPORT 2014

4 CONTENT 36. Human resource IMPORTANT MILESTONES IN Awards and achievements in Report of Board of Management 58. REPORT OF THE BOARD OF MANAGEMENT 68. SUSTAINABLE DEVELOPMENT 73. FINANCIAL REPORT ANNUAL REPORT 2014

5 Message from the Chairman of Board of Directors Ladies and gentlemen, 2014 was a year of changes, difficulties and challenges for the whole banking industry in general and for Military Bank (MB) in particular. After two years of implementation, the credit institution re-structuring process has attained certain promising results and the safety ratios of the bank system have been apparently stabilized and improved. However, the increased potential non-performing loans, slow credit growth and fierce competition in the bank system remain issues of great concern. Given the current socio-economic backdrop, the Board of Directors and the Board of Management with the energy and dedication of all MB staff, the Bank and its member companies have achieved significant operating results. MB itself exceeded virtually all of its 2014 targets with a profit before tax of above 3,100 billion, credit growth of 14.6%, and deposits increase of 23.2%. Loan structure has improved significantly as the proportion of outstanding loans to individuals increased, accounting for nearly 21% of the total outstanding loans compared to 14% in Operating expenses were adequately controlled and 6 ANNUAL REPORT 2014

6 allowances for loans to customers were sufficiently provided, ensuring safety in the Bank s operations was also a memorable year when MB celebrated its 20th anniversary and received the First Class Labour Medal, which is a noble reward recognizing MB s effort throughout its 20 years of formation. Under the leadership of the Central Military Commission Ministry of National Defense and the State Bank of Vietnam and with the dedicated support of other entities inside and outside the military force, MB s officers and staff of different generations have upheld the good nature and honourable traditions of the Vietnamese soldiers in an economic front: solidarity, proactiveness, creativeness, self-help, self-strengthening, overcoming difficulties, ceaseless professional ethic enhancement, renewal of work style, professional expertise enhancement, initiative promotion, operating quality improvement, and marketing the best bank products and services to individuals, economic entities and enterprises nationwide. MB has successfully fulfilled the tasks assigned by the Central Military Commission, and Leaders of the Ministry of National Defense and of the State Bank of Vietnam and has become a powerful bank and one of the top 3 commercial joint stock banks in Vietnam with 5 subsidiaries operating within the group. MB s internal governance, risk governance, financial governance, and HR governance, have developed to a new level, approaching international practices and standards. For this reason, MB has been judged by international rating agencies, audit firms, the State Bank of Vietnam and other regulatory agencies to be a credit institution with sound financial indicators, transparent statement of income, and accurately and objectively reported figures. MB s slogan solidness & confidence has been strengthened and developed throughout the past 20 years. Apart from business development, the Board of Directors have determined that the Bank s corporate culture one of the important strategic foundations, has developed strongly over time, enabling it to demonstrate our core values and uphold the prestige of the Army (strict discipline, efficiency, safety, compliance with law and social responsibility). Consequently, after 20 years of formation and development, MB has established its core culture values, namely solidarity discipline devotedness enforcement confidence efficiency. At the same time, as a listed company, MB consciously maintains and raises efficiency and transparency in governance with an orientation toward international best practices, ensuring we act in the best interests of our shareholders at all times. Ladies and gentlemen! In 2015, significant potential difficulties still exist for the world, regional and domestic economies. For 2015, the State Bank of Vietnam is strongly determined to further enhance bank re-structuring; implement monetary policies in a flexible and efficient manner, appropriately regulate interest rates; enhance credit for the economy with a growth rate of 13% - 15%; focus on non-performing loan resolution, and ensure safety for the bank system with an absolute target NPL rate of less than 3%. For MB, 2015 is the final year of implementing the strategy. For this reason, MB is strongly determined to realize strategic initiatives and consistent in reaching targets, ensuring that MB will be ranked in the top 5 Vietnamese commercial banks and continue to maintain the motto Restructuring and sustainable development. At the same time, during this year, MB will also establish a strategic orientation for and a vision to 2030, and implement focal programs for 2015 including the increase of charter capital, development of the connection channel with Viettel, development of 2 new business activities, namely life insurance and consumer finance Member companies will be closely controlled in the same manner with business units of MB and will implement their respective strategies for the period with a vision to 2030 so as to be deserving of MB membership. To complete this, the whole MB framework is committed to promoting intelligence and self-responsibilities to make contribution to the Bank, and at the same time, enhancing efforts, discipline, bravery and solidarity in implementation. Ladies and gentlemen! Over the past 20 years of formation and development, with the goal to become a whole-hearted and reliable companion of our customers, partners and shareholders, MB has made and continues to make efforts in heading towards the goal of sustainable development, adding value, and ensuring appropriate benefits for all stakeholders. It is your confidence in and support to us that brings us a strong motivation for MB to continue with our efforts and determination to successfully achieve the 2015 plan as well as the development objectives now and in the future. The Board of Directors, Board of Management and all the employees of the Bank undertake that we will continue to be a safe and sustainable financial partner for all customers, an efficient and stable investment destination for shareholders and partners, and one of the prestigious financial organizations with active contribution to the implementation of the monetary policies of the Government and State Bank of Vietnam. On behalf of the Board of Directors, Supervisory Board and Board of Management of MB, I would like to express our sincere thanks to the Central Military Commission, the Ministry of National Defense, the State Bank of Vietnam, state regulatory agencies, shareholders, customers and partners who have always supported and helped us during the past time. We hope to continue to receive your support and have you as companions in the future. I would like to thank all members of the Board of Directors, the Supervisory Board, the Board of Management and all other staff who have made great efforts to chase the targets and overcome difficulties in the past period. Wish you good health, happiness and success. LE HUU DUC Chairman of Board of Directors ANNUAL REPORT

7 8 ANNUAL REPORT 2014

8 GENERAL INFORMATION: 20-Year journey Business Goals & Development Strategy for Risk management MB network Organizational Structure during Members of the BODs & Supervisory Board Members of the Board of Management Human resource ANNUAL REPORT

9 20-YEAR JOURNEY MB was established on 4 November 1994 to support military enterprises businesses. Its initial capital did not exceed 20 billion, which was much smaller than that of other banks at that time. Starting as a small bank, MB achieved stable and steady development, and became the only profitable bank during the 1997 Asian financial crisis, which occurred three years after its establishment; annual growth rates of 20% to 30% have been maintained during the succeeding years. Its business growth and expansion was also marked in this period as the Bank became a member of the interbank forex market (1997); acquired 10,000m2 ASEAN Hotel (1999); and established its Treasury and Forex Department (1999). Thang Long Securities Company, MBS was established in 2000 and its asset management company, MB AMC was established in These are significant milestones of MB, forming the foundation of a management model for a universal and modern financial group. At the end of this period, as its development was beyond its initial purposes, MB became a financial institution providing services covering almost all Vietnamese customer segments. 10 ANNUAL REPORT 2014

10 With the idea of developing a corporate financial institution and a millitary enterprise to a Commercial Joint Stock Bank, after an active preparation period of 18 months, on 04 November 1994, MB started its official operation with head office at 28 Dien Bien Phu, Hanoi, with a charter capital of 20 billion and 25 employees Following such a significant development period, MB embarked on a restructuring plan for its comprehensive development, expanding its market share and accelerating rapid, robust and stable growth during the period from 2003 to 2008, with a vision to Some outstanding events of MB in this period were: becoming the first bank to undertake an Initial Public Offering (IPO) in Vietnam with a total par value of 20 billion in 2004; entering a trilateral cooperation agreement with Vietcombank and Viettel, and cooperating with Citibank (2005) to develop foundation of financial products and services with hi-tech content; expanding to other operational fields under its comprehensive list of financial products service chain development; and optimally supporting customers by establishment of Hanoi Fund Management Company (HFM the current MB Capital Management Joint Stock Company (MB Capital) (2006). Following this rapid development, MB was successful in increasing its charter capital to 3,400 billion (2008) and to 5,300 billion (2009). Significantly, in 2010, MB commenced implementation of its strategic development plan for the period from 2011 to Building on the success of MB s first 15 years of operations, the bank embarked on implementing its development strategy for the period from 2011 to 2015 with a vision to 2020 to strengthen all operations and to be in the top three leading joint stock commercial banks in Vietnam without state-owned controlling shares. In 2011, the first year of this period, MB s military administration function was transferred under the control of the Ministry of Defense, the Communist Party of the Bank was under the Central Military Commission. The Bank also successfully went public on Ho Chi Minh Stock Exchange (HSX); and expanded its operations in overseas market by establishing its branch in Cambodia. The most notable mark of MB in this period is the breakthrough to the first rank in three consecutive years 2012, 2013 and 2014 regarding operating profits and performance in comparison with other joint stock commercial banks without state-owned controlling shares; and is currently considered the fifth largest bank in Vietnam. At the end of the period from 2003 to 2010, MB commenced operations in foreign market, with the establishment of its branch in Laos, coming into operation on 30 December ANNUAL REPORT

11 MB s strategic goals Target of growth for the period Top 3 Commercial joint stock banks in Viet Nam Annual Growth rate times more than domestic banking industry s average growth rate Vision for the period The Customer Convenient Bank The Community Bank The Professional Commercial Bank The Transaction Bank LEADING RISK MANAGEMENT Fast execution AND delivery culture 12 ANNUAL REPORT 2014

12 In 2010, MB engaged McKinsey, one of the world s leading consultancy firms, to develop strategy for the period MB implemented this strategy over that period with the goal of being ranked in the top three joint stock commercial banks in Vietnam in MB is expected to be a convenient bank with three pillars, community banking, professional banking, and transaction banking complimented by two platforms: leading risk management and excellent credit appraisal; and customer-oriented fast execution and service delivery culture. After four years of implementing strategic solutions, MB achieved vigorous and comprehensive changes across our operations, which demonstrates that the bank is on the right track. MB is focused on being a convenient, modern and multi-functional bank that serves both organizations and individuals by continuously developing its distribution networks. In 2014, MB had 224 transaction points located in 42 provinces nationwide, 120 of which were new (2.3 times increased) compared to the number in Its distribution network has been also developed by agents and the channels of Viettel. MB continues to strive to integrate information technology (IT) in its ongoing operations, governance and management activities. To this extent, the Bank has developed and implemented modern technology infrastructures including typical strategic plans such as BPM, CRM, and Data warehouse/mis... The infrastructure of a transaction bank is developed with technology in cooperation between the Bank and Viettel Telecommunication, e-banking products (BankPlus, BankPlus Master Card, Ebanking, ) MB has been developing several risk management tools and related infrastructure in accordance with Basel II. The credit risk management framework follows three lines of defense model, which allows segregation of risk management/credit policy and appraisal/implementation of the credit policy to facilitate rapid credit growth with proper risk control. The Bank has completed operational risk measurement tools, policies and framework; implemented centralized credit assessment and credit support to enhance credit quality and sales capacity of its branches. MB always seeks solutions, such as improvement of internal procedures, regular measurement and control employing tools such as ISO, SLA, LSS, and building a customer-oriented service provision culture, to monitor and enhance thoroughly customer-oriented service quality, the key point to distinguish the leading bank. Operational procedures are automated to be more professional and services are more promptly provided to customers with ensured operational risk management. Particularly, the human resources solution covering training, planning, evaluation, reward and corporate environment contributes to developing qualified and efficient staff. Moreover, MB has been developing and operating the business administration model of a full service financial group, in which the Bank is the core and its subsidiaries operate in different fields such as insurance, securities, asset management and real estate The bank is also successful in restructuring its organizational structure and operating procedures for banking-corporate products and services connection and enhancement of the overall competitiveness of its entities. ANNUAL REPORT

13 QUẢN Quản Risk TRỊ trị management RỦI rủi ROro In 2014, the economy saw positive changes, the macro economy gradually recovered and stabilized, and the financial markets also improved. Operations of local credit institutions (CIs) saw remarkable changes in structures and bank restructuring was robust to form a safer and more efficient financial market. However, the economy still bore several potential risks, difficulties and challenges. In such context, risk management (RM) in MB, following the centralized RM model, has vigorously changed to an advanced and modern RM platform, approaching global practices and meeting the overall business strategy of MB. The three lines of defense risk management model not only allows segregation of duties between business, risk management and internal audit functions but also supports business development in accordance with MB s risk management principles. Therefore, MB successfully converted business opportunities, controlled its risks in accordance with MB risk policies and risk appetite, balanced risk and profit, and ensured safety, efficiency, and appropriate direction of the Bank s operation. During the period of , a variety of solutions were implemented to enhance RM capability. These included the development of the non-performing loan management and recovery software, management of limits in the core banking system, development of the software to classify and approve credit for individual customers and micro SMEs, development of tools for market risk management and treasury transaction monitoring, development of the anti-money laundering software, and early warning system.. Risk quantification models following advanced approaches were also studied, developed and put into practice with initial positive results. Redesigning and automation of credit granting and approval procedures and other banking procedures follow good practices to ensure segregation of duties within each procedure following the end-to-end principle and optimally arrange checkpoints, which helps increase productivity, decrease transaction processing time, and minimizing customer documentation and procedures. Furthermore, capacity for risk management, financial management, operational governance, business administration, and information technology and database management were also improved. Projects to allocate expenses and capital to different customer segments and products provided better management of expenses and business performance, and more efficient capital use. Operational governance resulted in enhancements of productivity, service quality and optimization of human resources in supporting each step. Projects to improve technology platforms such as the host server with sufficient capacity for further development, development of cyber security system, strict regulations on data privacy, and centralized data warehouse, and business continuity project also contributed to a well-built information technology infrastructure. Risk monitoring, early warning and prevention mechanisms were implemented extensively in 2014 to ensure a quality asset portfolio. Modern training and communication regarding risk management were also enhanced to form a sound and extensive risk culture. In 2014, MB was one of ten banks selected by the State Bank of Vietnam for pilot implementation of Basel II. MB was proactive on preparation of human resources, knowledge and technology for effective adoption and implementation of the advance banking standards. At the moment, MB is being consulted by Ernst &Young (Singapore) to complete a project on gap analysis and building up Basel II implementation schedule in accordance with MB s current strategies and available resources. In 2014, MB made the effort to proactively integrate and comply with international regulations and codes such as FATCA, Dodd Frank, Emir and Patriot Act, via a number of projects, in which such regulations and codes were enforced extensively at MB and its subsidiaries and associates. The project on FATCA compliance with consultancy provided by KPMG is an example for MB s action in international integration and operation transparency. Projects on Dodd Frank and Emir compliance will be implemented in In the near future, MB will continue to position itself as one of the leading banks in risk management, with specific strategies as follows: Firstly, maintaining the balance between our strict risk appetite and profit objectives; Secondly, developing risk management policies in line with the bank s business strategies, which may flexibly and actively support business operations; Thirdly, prioritizing to invest in competent RM human resources; Fourthly, applying modern, advanced, and global-standard RM knowledge and technology; Fifthly, focusing on technology for comprehensive modernization of RM practices and efficiency of RM on a large scale, particularly for monitoring risks of the whole system; With our comprehensive risk management strategy, MB is gradually positioning itself as one of the leading joint stock commercial banks in Vietnam, active in business and prudent in risk prevention and mitigation. 14 ANNUAL REPORT 2014

14 BASEL II CAPITAL ACCORD PILLAR 1 PILLAR 2 PILLAR 3 MINIMUM CAPITAL REQUIREMENTS SUPERVISORY REVIEW PROCESS MARKET DISCIPLINE MANAGEMENT INFORMATION GOVERNANCE Incidents & Loss Events Learn from past Risk Profiles & Quantification Analysis Action Line Management & Reporting Planning & Change CHU KỲ QUẢN TRỊ RỦI RO Risk Appetite Roles & Delegated Authorities Policies Present Predictor Events Controls Risk Analysis Committees Future Systems and Tools Communication, Education, Training and Guidance ANNUAL REPORT

15 MB network As at 31 December 2014, MB had 224 transaction points licensed by the State Bank of Vietnam as follows: - 01 Head Office at No. 21, Cat Linh Street, Dong Da District, Hanoi - 02 overseas branches in Laos and Cambodia - 71 local branches transaction offices - 02 saving funds 16 ANNUAL REPORT 2014

16 Branches in vn no of transaction points Hanoi 62 Hung Yen 3 Bac Ninh 2 Hai Phong 13 Hai Duong 3 Quang Ninh 5 Viet Tri 5 Vinh Phuc 1 Thai Nguyen 4 Ninh Binh 4 Thanh Hoa 4 Nghe An 4 Lao Cai 1 Quang Ninh 1 Bac Giang 1 Thai Binh 1 Ha Tinh 1 Hue 4 Quang Tri 2 Da Nang 6 Quang Nam 3 Quang Ngai 3 Binh Dinh 3 Khanh Hoa 4 Dak Lak 2 Gia Lai 3 Ho Chi Minh 38 Dong Nai 5 Vung Tau 4 Can Tho 3 Binh Duong 4 An Giang 2 Dong Thap 1 Long An 2 Kien Giang 2 Tay Ninh 1 Tien Giang 1 Lam Dong 1 Ca Mau 1 Total 224 Foreign branch no of branch Campuchia 1 Lao 1 ANNUAL REPORT

17 Subsidiaries list of subsidiaries as at 31/12/2014 NO. Company name Head office 01 MB Securities Joint Stock Company No. 3 Lieu Giai Street, Ba Dinh District, Hanoi 02 MB Capital Management Joint Stock Company Floor 8, No. 3 Lieu Giai Street, Ba Dinh District, Hanoi 03 MB Assets Management Company Limited Floor 4, 195 Building Kham Thien str., Dong Da District, Hanoi 04 COÂNG TY COÅ PHAÀN ÑÒA OÁC MB MB Land Joint Stock Company (*) 6-8 Chua Boc, Quang Trung Ward, Dong Da district, Hanoi 05 Viet R.E.M.A.X Joint Stock Company (*) 259 Tran Hung Dao, Co Giang Ward, District 1, Ho Chi Minh City 18 ANNUAL REPORT 2014

18 Operating license Nature of Business Charter capital ( billion) Percentage of MB ownership 12/GPDC-UBCK dated 11 June 2014 issued by the State Securities Commission Investment brokerage and securities trading ,52% 32/GPDC-UBCK dated 4 October 2013 issued by the State Securities Commission Fund management ,65% dated 11 July 2014 issued by the Hanoi Department of Planning and Investment Debt and asset management 1, ,00% dated 5 September 2014 issued by the Hanoi Department of Planning and Investment Real estate trading and investment ,14% dated 2 February 2010 issued by Ho Chi Minh City Department of Planning and Investment Investment in development of MB Office at HCMC ,00% ANNUAL REPORT

19 MB Capital Management Joint Stock Company (MB Capital) MB Capital currently has a chartered capital of 200 billion (of which, MB owns 84.65%) and specializes in fund management, providing services on investment management, investment portfolio management, investment advisory, and entrusted asset management. MB Capital currently manages two local-member closed-end funds, two openend funds (one open-end bond fund and one foreign open-end share fund), investment portfolios of local and foreign individual and institutional investors. The total value of assets managed by the company at the end of 2014 was 1,122 billion; MB Capital is one of the five fund management companies that manage most funds and has become an experienced partner with good market understanding in asset management industry in Vietnam. With its dynamic business strategy, the company continues to grow steadily, strengthening and enhancing its capacity and position in the fund management sector, establishing the framework for its robust development in the next few years.. MB Assets Management Company Limited (MBAMC) MB Land Joint Stock Company (MB Land) Charter capital: 1,082,689,080,000 (One thousand and eighty two billion six hundred and eighty nine million eighty thousand) MBAMC is a one member limited liability company fully owned by MB. MBAMC and specializes in debt arrangement, debt trading, property management, asset verification and valuation. By the end of 2014, the Company has achieved impressive results in the core business segment, in particular: the value of arranged debts increased by 212% compared with results of 2013, total value of valuated assets increased 131% compared with In 2015, the company sets a goal of sustainable growth, enhancing and further improving service quality. Debt arrangement activity continues to be its business strength and be selected as the breakthrough operation in implementing strategic solutions of the Company. Besides, assets management continues to be developed and the Company will ensure that collateral valuation is concentrated and, at the same time, expanded in scale with improvement of quality, reliability and professionalism. COÂNG TY COÅ PHAÀN ÑÒA OÁC MB MBLand was established on the basis of AMC s plan of asset management and debt arrangement. Currently, MBLand is a subsidiary within the MB system; 66.14% of its charter capital is owned by MB; its major operating sector is real estate. After five years of operation, having overcome initial difficulties, MBLand has gradually confirmed its position and reputation in the real estate market. By 2014, the real estate market saw many positive signs; MBLand achieved relatively encouraging business results. In 2015, MBLand determines its operation motto Complete restructuring, sustainable development toward completing the strategic objectives with the oriented activities: focusing on core business pillars and improving governance capacity and business management. Viet R.E.M.A.X Joint Stock Company Viet R.E.M.A.X Joint Stock Company is a joint-stock company that operates in the field of investment and development of the MB offices project. Since early 2010, MBAMC (holding 80% of the charter capital of Viet REMAX) has been the owner of Viet REMAX with the objectives of successful development of the MB Sunny Tower project at 259 Tran Hung Dao Street, District 1, HCMC, to be used for MB headquarter in the southern region. At present, MB Sunny Tower has been completed and was put into operation in Quarter 2 of Viet R.E.M.A.X is undergoing its restructuring process to become MB s debt arrangement entity in south region and manage and operate the MB Sunny Tower. 20 ANNUAL REPORT 2014

20 MB Securities Joint Stock Company (MBS) Charter capital: 1,221,242,800,000 (One thousand two hundred and twentyone billion, two hundred and forty-two million, eight hundred thousand ). MBS s charter capital is 1,221 billion (of which MB accounts for 79.52%); MBS mainly operates in the field of securities investment and trading. Founded by Military Commercial Joint Stock Bank (MB) in May 2000, MB Securities JSC (MBS) is one of the first five securities companies launched in Vietnam. Although the stock market was more volatile in 2014, MBS remained in the top 10 group of securities firms having the largest brokerage market share. Besides, financial advisory services of MBS also flourished and left impressive imprints in the stock market with many important awards such as The Typical Merger Deal and Typical Consultant. In 2015, MBS aims to obtain sustainable growth, improve governance capacity and business management, gradually improve service quality, and enhance the reputation and brand of MBS with customers. Subsidiary management orientations and group orientations MB is currently moving to a group operation model (MB Group), whereby the parent company is Military Commercial Joint Stock Bank, and its subsidiaries are companies specializing in securities, fund management, real estate and insurance. Accordingly, subsidiaries will leverage the Group s advantages to the maximum extent and operate efficiently in their business areas. In 2015, MB aims at offering financial, investment, and insurance packaged solutions to clients based on maximum integration of services provided by its subsidiaries. Simultaneously, MB s subsidiaries with their main activities will provide supporting services along with services of the commercial bank. On this basis, MB s general strategies are developed with the following specific actions: Synchronously developing subsidiaries in line with the Group s business strategy. Investing in improving financial capacity and developing business resources; developing strategic share holder partners; finding strategic partners to develop the subsidiaries business; selecting strategic part ners for multiple ownership and efficient capital restructuring; and creating subsidiaries brand values; Establishing and enhancing coordination mechanism for effective investment and business; promoting cross-selling, and fully utilizing the Group s advantages. ANNUAL REPORT

21 22 Organizational structure

22 ANNUAL REPORT

23 Members of Board of Directors Mr. Le Huu Duc Chairman of Board of Directors Senior Lieutenant-General Le Huu Duc graduated with a PhD degree from the National Defense Academy and has held key positions at the Air Force and Air Defense for 20 years. In the capacity of the Chairman of Board of Directors of MB since 2011 during the term , he has left impressive imprints in his own governance model, strategic orientation and management methodology at MB. At the same time, he has provided drastic directions in the comprehensive restructuring of subsidiaries resulting in their positive achievements. He is also the person to strengthen the military character in MB s corporate culture with the motto Strict Discipline Rule of Law Efficiency - Safety - No Fear of Competition Social Responsibility. Senior Lieutenant-General Le Huu Duc is currently Member of the Central Party Committee XI; Member of the Central Military Commission; National Assembly XIII Deputy; Member of the Finance and Budget Committee of the National Assembly, and Deputy Minister of National Defense. 24 ANNUAL REPORT 2014

24 Mr. Luu Trung Thai Vice-Chairman of Board of Directors Mr. Luu Trung Thai graduated with a Master s degree in Business Administration University of Hawaii - USA. Mr. Luu Trung Thai has worked with MB for 17 years and, for several years, held key positions of MB, such as Head of credit at the Head Office, Branch Director, HR Director, and Deputy General Director. From 2011 to April 2014, he was appointed Chairman of Board of Directors and General Director of MBS and left impressive imprints in the restructuring process of the Company. On 24 April 2013, he was elected Member of the Board of Directors for the term and officially appointed Vice Chairman of Board of Directors in September He is currently Vice Chairman of Board of Directors of MB and Member of the Board of Directors of Viettel Post Joint Stock Corporation. Mr. Nguyen Manh Hung Vice Chairman of Board of Directors Major General Nguyen Manh Hung holds Master s degrees in Business Administration (National Economics University) and in Electronics and Telecommunications (University of Sydney Australia) and graduated as an engineer majoring in radio from Ulianov Information Academy (Russia). He had worked for a long time and made significant contributions to the success and development of Vietnam Military Telecommunications Group (Viettel). Having participated in MB s Board of Directors since 2009, Mr. Hung has served as a bridge between MB and Viettel in the development of products and services with hitech content. Currently, Mr. Hung holds the positions of General Director of Viettel, Chairman of the Board of Directors of Viettel Global Investment Joint Stock Company (Viettel Global), Chairman of the Board of Directors of Vinaconex - Viettel Urban Development Joint Stock Company, Member of the Board of Directors of Vietnam Construction, Import - Export Corporation (Vinaconex), Chairman of the Board of Directors of Cam Pha Cement Joint Stock Company. ANNUAL REPORT

25 Members of Board of Directors 26 Mr. Le Cong Member of Board of Directors Major General Le Cong graduated with a PhD degree in economics at the Academy of Finance. He joined MB in 1995 and previously worked for 6 years at the Ministry of National Defense. From 1997 to 2010, he held the position of Deputy General Director of MB. On 4 January 2010, he was appointed General Director by the Board of Directors. Mr. Le Cong has been judged to be one of the prestigious commercial bank general directors who have achieved significant success and were highly appreciated by the SBV in recent years. In 2013, he was appointed to the military rank of Major General and joined the force of Army Generals involved in operation in an economic front. For recognition of his devotion to the development of the Bank, in 2014 he was awarded the Third Class Labour Medal. Currently, he is a dedicated Member of the Board of Directors cum General Director of MB, and Vice-Chairman of the Board of Directors of the Military Petrochemical Joint Stock Company. Mr. Ha Tien Dung Member of Board of Directors Major General Ha Tien Dung graduated from Gagarin Institute and National Economics University. Mr. Dung has held senior management positions for more than 13 years at Vietnam Services Flight Corporation (currently known as Vietnam Helicopter Corporation). He joined the Board of Directors of MB in 2009 and is currently Commander of Multi-battalion No. 18 and General Director of Vietnam Helicopter Corporation Limited Company, Chairman of Board of Directors of MB Real Estate Joint Stock Company (MB Land), and Chairman of Board of Directors of Hai Au Investment Trading Joint Stock Company. ANNUAL REPORT 2014

26 Ms. Tran Thi Kim Thanh Member of Board of Directors Ms. Tran Thi Kim Thanh graduated from the Banking Academy, and holds a Master degree in Economics Foreign Trade University. She is an experienced banking expert. From 1995 to present, she has held several key management positions at Vietcombank. Ms. Thanh has been Member of MB s BOD since She is also the Head of the Investment Department of Vietcombank, Member of the Members Council of Vietcombank Tower 198 and the Head of Supervisory Board of VCB Money Transfer Company in the United States. Mr. Nguyen Dang Nghiem Member of Board of Directors Major General Nguyen Dang Nghiem graduated as a Bachelor of Economics at Vietnam Maritime University. He has more than 20 years of experience in several important positions in the Saigon Military Port. He joined MB s Board of Directors in 2009 and has made significant contributions to strengthening the cooperative relationship between MB and Newport. Apart from the position of Member of MB s Board of Directors, he is Vice-Chairman of the Members Council cum General Director of Sai Gon Newport Corporation, Vice-Chairman of the Board of Directors of Cat Lai Port Joint Stock Company, and Chairman of the Board of Directors of Tan Cang Cai Mep Joint Stock Company. ANNUAL REPORT

27 Members of Board of Directors ÔNG NGUYỄN VĂN HUỆ Independent Member of Board Mr. Nguyen Van Hung Member of Board of Directors Mr. Nguyen Van Hue graduated as a Master of Finance and Banking at the National Economics University. Mr. Hue used to hold key positions at the Finance Department Ministry of Defense, namely Head of the Planning and Budget Sub-Department and Head of the Corporate Finance Sub- Department. With significant experience in corporate finance, Mr. Hue has made significant contributions to MB with his constructive inputs and assisted MB to develop relationships with customers and partners. Mr. Nguyen Van Hung graduated as a bachelor in Prague, the former Czechoslovakia, and is the successor of Mr. Dau Quang Lanh at 28 Corporation. He has significant experience in corporate governance and is Member of the Board of Directors of 28 Corporation. Apart from the position of Member of MB s Board of Directors, he is currently Chairman cum General Director of 28 Corporation One Member Limited Liability Company, Member of the Board of Directors of Central Human Resources Training and Development Joint Stock Company, Member of the Board of Directors of Industrial University of Vinh, and Member of the Board of Directors of Vinatex Investment Joint Stock Company. 28 ANNUAL REPORT 2014

28 Ms. Nguyen Thi Ngoc Member of Board of Directors Ms. Nguyen Thi Thuy Member of Board of Directors Ms. Nguyen Thi Ngoc graduated as a Master of Business Administration at California Miramar University and as a Bachelor of Laws at Hanoi Law University. Ms. Ngoc is one of the members who joined MB in the first days of its foundation, has experienced multiple functions at MB from investment project management, planning, to legal affairs and has been the Chief of the BOD Office of MB since its establishment. Ms. Ngoc has made significant contributions to enhancing MB s corporate governance to an advanced level and approaching international practices. Ms. Nguyen Thi Thuy graduated as a Master of Business Administration - University of Applied Sciences and Arts Northwestern Switzerland. She is one of the officers who have worked for a long time for MB and has managed and developed Thang Long Branch to a leading branch of MB. She has played an important role in successfully attracting a great number of major customers for MB and in training and developing the human resources for MB system including many Branch Directors and managers who have been developed from MB Thang Long Branch. ANNUAL REPORT

29 Members of Supervisory Board Ms. Vu Thi Hai Phuong Chairman of Supervisory Board Ms. Le Minh Hong Member of Supervisory Board 30 Ms. Vu Thi Hai Phuong graduated as a Master of Economics Banking Academy. She is one of the first 25 staff of MB and has held multiple key positions such as Director of the Transaction Office, Deputy Director/ Director of the biggest branch of MB (Dien Bien Phu Branch) and Deputy General Director. In the capacity of MB s Deputy General Director, she has succeeded in developing the organization and directing the operation of different Divisions: Major Corporate and Financial Institution Division (the period ), and Network and Distribution Division ( ). She has made signification contributions to attracting and developing the major client group for MB, establishing MB s network development strategy with a combination of a physical network with other connection channels in order to develop advanced, modern and convenient banking services, and training and coaching successor officers for MB. Being trusted and nominated by the Board of Directors, at the General Meeting of Shareholders for the term she was elected Chairman of the Supervisory Board. Ms. Le Minh Hong graduated with a PhD degree in Finance and Banking National Economics University. Ms. Hong was a former independent member of MB s Board of Directors for the term She used to be a bank officer and was a department-level leader of the Government Office in charge of enterprise transformation for many years. With an insight in finance and enterprises, during the period of acting as an independent member of the Board of Directors, she made significant contributions and gave positive inputs to the Board of Directors. Ms. Hong is currently Member of MB s Supervisory Board and Chairman of the Supervisory Board of MB Capital Management Joint Stock Company. ANNUAL REPORT 2014

30 Mr. Dang Quoc Tien Member of Supervisory Board Ms. Nguyen Thanh Binh Member of Supervisory Board Mr. Dang Quoc Tien is a Master of Business Administration - Pacific Western University, a Bachelor of Economics Foreign Trade University, and a Military Engineer. Mr. Tien joined MB as early as in its pre-operating stage and has held multiple key positions such as Director of Ho Chi Minh Branch, Deputy General Director of MB in charge of the Southern Area. Mr. Tien has made positive contributions to MB in general and to MB s Southern area in particular in successfully developing good relationships with major customers and regulatory agencies in the localities. Graduating from the National Economics University of Prague, she has 30 years experience in Corporate Finance Management for the Ministry of National Defense. At MB, she is a Member of Supervisory Board for the terms and , and Chairman of Supervisory Board of MB Securities Joint Stock Company for the terms and In the capacity of Member of the Supervisory Board, Ms. Binh has actively assisted the Supervisory Board in inspection of MB s financial operation, supervision on compliance with the accounting regime and safety in MB s operation, performance of internal audit of operation for each period and each work area aimed at accurately evaluating MB s governance, management, business and financial position. Ms. Binh is currently Member of MB s Supervisory Board and Chairman of the Supervisory Board of MB Securities Joint Stock Company. ANNUAL REPORT

31 Board of Management Mr. Le Cong General Director Major General Le Cong graduated with a PhD degree in economics at the Academy of Finance. He joined MB in 1995 and previously worked for 6 years at the Ministry of National Defense. From 1997 to 2010, he held the position of Deputy General Director of MB. On 4 January 2010, he was appointed General Director by the Board of Directors. Mr. Le Cong has been judged to be one of the prestigious commercial bank general directors who have achieved significant success and were highly appreciated by the SBV in recent years. In 2013, he was appointed to the military rank of Major General and joined the force of Army Generals involved in operation in an economic front. For recognition of his devotion to the development of the Bank, in 2014 he was awarded the Third Class Labour Medal. Currently, he is a dedicated Member of the Board of Directors cum General Director of MB, and Vice-Chairman of the Board of Directors of the Military Petrochemical Joint Stock Company. 32 ANNUAL REPORT 2014

32 Mr. Le Hai Deputy General Mr. Le Hai graduated with a Bachelor s degree from the Banking and Finance Department of the National Economics University and a Master s degree from the Academy of Finance, and is currently a course-one fellow of the Banking and Finance Department of the Military Academy of Logistics. Joining in 1998, he has held several key positions at the Bank such as Director of Viet Tri Branch, Director of Dien Bien Phu Branch, Acting Director of SME Division, Director of Individual Customer Division. With great contributions to restructuring individual customers in business activities of MB, in 2 August 2013, Mr Le Hai was officially appointed as Deputy General Director of MB, to in charge of some key business segments, products, and services of the Bank. ANNUAL REPORT 2014 MR. DO VAN HUNG Deputy General Director Graduating from the National Economics University (Faculty of Finance and Banking) and Hanoi University for Foreign Studies (English Faculty), Mr. Hung has more than 10 years of experience in banking and finance. Joining MB since 1999, Mr. Hung held key positions for many years such as Deputy Head of International Payment Department, Head of International Payment Department and Head of HR and Administration. He is currently in charge of Party Secretary (in charge of Party related activities) and northern MB in general. Ms. Pham Thi Trung Ha Deputy General Director Graduating with a Master degree in Economics (Finance and Banking), Ms Ha has 15 years of experience working at MB. She held several important positions at MB including Head of Credit Management Department, Deputy Head of Risk Management Division, Head of Risk Management Division. With great contribution to MB with excellent accomplishments, she was appointed Deputy General Director in charge of he Internal Inspection and Control Division and Risk Management Division. 33

33 Board of Management Mr. Hoang The Hung Deputy General Director Born on 24th October 1981, Mr. Hoang The Hung belongs to the new generation of young, dynamic leaders in MB. Graduating with a Master s Degree in Information Technology from the University of Nottingham the United Kingdom, he made notable contributions to the development of Viettel Telecom under Viettel Corporation. He has been serving as vice CEO, in charge of Information Technology at MB since 5th of November He is expected to promote the development of MB s hi-tech banking products in the coming years. Ms. Nguyen Minh Chau Deputy General Director Graduating from Paris Dauphine Economics University (France) and ESCP-EAP Economics Management University with Masters Degrees, Ms. Chau has several years holding senior positions in fund and foreign exchange management at reputable banks including Hanoi Hanil, Woori Bank, and PG Bank. She officially joined MB in November 2009 in the capacity of Deputy General Director in charge of the Treasury division. Ms. Nguyen Thi An Binh Deputy General Director Holding a Masters degree in Economics, Ms Binh has much experience in internal control. She has been working in this area for many years and assumed various important positions including Deputy Head of Finance and Accounting Department in charge of Internal Control, Deputy Head of Internal Control Department and then Head of Internal Audit Division. She has led the Internal Control Division to gain excellent achievements and awards at MB and was granted a Certificate of Merit by the Governor of SBV in Ms. Binh is now in charge of Operation Division. 34 ANNUAL REPORT 2014

34 Mr. Tran Minh Dat Deputy General Director Mr. Tran Minh Dat was born in He graduated with a Master s degree in economics from the National Economics University and held several key positions at MB such as Director of Hai Ba Trung Branch, Director of Dien Bien Phu Branch. In November 2014, he was appointed as Deputy General Director of MB in charge of credit appraisal and approval of the whole bank, as well as directly leading the operation of Appraisal Division MS. LE THI LOI Deputy General Director As one of the first joiners to MB, Ms. Loi has been assigned several key positions and has many years of experience in Accounting and Finance. She assumed several key positions at MB Dien Bien Phu Branch and MB including the Head of Accounting Department and then Vice-Director of Dien Bien Phu Branch, Deputy General Director of MB. She is regarded as providing the major contribution to the success of Dien Bien Phu Branch as a leading branch in the whole MB system. She has changed to MB Head Office as CFO. In June 2014, she was appointed Deputy General Director and CFO of MB. Mr. Uong Dong Hung Deputy General Director Mr. Uong Dong Hung is one of the younger leaders who matured from the environment of MB. He started his career with the position of customer development officer at the Head Office. He also held leadership positions at some MB branches such as Deputy Director of Long Bien Branch, Director of Tran Duy Hung Branch and Director of Transaction Center. From April 2012 to August 2013, he was Director in charge of the Central Highlands & Central Vietnam region and Director of MB Transaction Center. On 2 August 2013, he was appointed Deputy General Director of MB. Mr. Uong Dong Hung is in charge of business activities in the South with the aim to boost the development of MB in this region. ANNUAL REPORT

35 18,138,646 /month Human resource statistics Number of employees as at 31/12/2014 6,057 people Average age 30 years old Average per capita income in 2014 University degree or higher 88.7% (5374/6057) people College degree or lower 11.3% (683/6057) people 36 ANNUAL REPORT 2014

36 Human resource statistics* (31/12/2014) * MB Bank alone 18,138,646 /month 6,057 people Average per capita 30 years old Average age Number of employees University degree or higher College degree or lower 88.7% (5374/6057) people 11.3% (683/6057) people ANNUAL REPORT

37 Employee policies 38 ANNUAL REPORT 2014

38 Salaries and benefits: In addition to monthly salaries and allowances, MB also provides employees with periodic supplementary payments on holidays; ad hoc bonuses for teams or individuals who provide excellent performance and valuable initiatives and contribution to the Bank; and preferential offer of shares to employees. To encourage and engage employees with the Bank, MB introduces other benefit policies for employees and their families, such as birthday gifts or Lunar New Year gifts; fund support for socializing between employees in different departments and divisions; and combined health insurance scheme for individuals. Training Professional training for knowledge enrichment and expertise enhancement for employees is specifically underlined so as to best satisfy requirements of the Bank s operation and meet the orientation of business development. Beside title-specific standardized training courses, employees can participate in internal training sessions at the premises. They are also supported to attend short-term or long-term training courses at external schools/academies. Furthermore, MB actively develops its personnel plan and provides staff with additional training for knowledge enhancement aimed at successful fulfillment of current jobs or career development in the future. Benefits MB employees are entitled to full benefits including social insurance, health insurance, unemployment insurance, public holiday leaves, and trade union membership, etc. in accordance with current regulations. They also have periodic medical check-up, corporate holidays, sickness allowances, etc. on an annual basis. ANNUAL REPORT