www.techcombank.com.

vn

Annual Report 2008

VIETNAM TECHNOLOGICAL AND COMMERCIAL

JOINT STOCK BANK
70-72 Ba Trieu, Hoan Kiem, Ha Noi
Tel: 04. 39446368 VIETNAM TECHNOLOGICAL AND COMMERCIAL
Fax: 04. 39446362 JOINT STOCK BANK
 FINANCIAL HIGHLIGHTS

Contents

2008
FINANCIAL HIGHLIGHTS 1

MESSAGE FROM CHAIRMAN OF BOARD OF DIRECTORS 2-3

REPORT BY CHIEF EXECUTIVE OFFICER 4-7

CORPORATE GOVERNANCE 8
Board of Directors 8-9
Board of Supervision 10
Board of Management 11-12 Financial Highlights
Organizational Chart 13

RETAIL BANKING 16-21 No. Indicators 2008 2007 2006 2005 2004

CORPORATE BANKING 22-27

1 Total assets 59,360 39,542 17,326 10,666 7,667

INVESTMENT BANKING 30-31
2 Share capital 3,642 2,521 1,500 617 412
RISK MANAGEMENT 32-37
3 Total equity 5,615 3,573 1,762 1,009 515
TECHNOLOGY 38-39
4 Capital adequacy ratio (%) 13.99 14.30 17.28 15.72 10.19
HUMAN RESOURCES 40-42
5 Total income 8,382 2,653 1,398 905 494
CORPORATE AND SOCIAL RESPONSIBILITIES 43-45
6 Provisional reserves 512 144 120 89 95
AWARDS AND SOCIAL RECOGNITION 46-47
7 Profit before tax 1,600 709 356 286 107
FINANCIAL TARGETS FOR 2009 50
8 Profit after tax 1,173 510 257 206 76

AUDITED FINANCIAL STATEMENTS 2008 51

9 ROE (%) 25.87 22.98 26.76 45.19 31.71
Audited financial statements for Bank 51
Audited consolidated financial statements 68 10 ROA (%) 2.28 1.99 1.89 2.60 1.70

BRANCH NETWORK 78
(Unit: Bln VND)
MESSAGE FROM CHAIRMAN OF BOARD OF DIRECTORS

I’m proud to say that 2008 was an exciting and successful year for
Techcombank as we demonstrated a high level of resilience given the
global financial turmoil and local economic recession. Our outstanding
results and record dividend payment to shareholders show we have
the strong foundation with solid underlying momentum in our business
and we are moving in the right direction to realize our aspiration to
become a leading joint stock bank in Vietnam.
The banking business delivered a full year after tax profit Management Company Limited (Techcombank AMC)
of VND1,173 billion, representing a 130% increase on with a registered capital of VND70 billion, Techcombank
the previous year. This performance was attributable to Securities Company Limited (Techcom Securities) with
good growth in all business lines, especially securities a registered capital of VND300 billion and Techcombank
trading and non-credit services. Our equity capital, total Capital Company Limited (Techcom Capital) with a
assets, customer deposits and loan book all increased registered capital of VND40 billion. We are confident
by more than 50%, assisted by an expanded branch that these companies will soon deliver good returns for
network and widened business operations and the the whole group.
improved capabilities of all units. We are now in a
strong liquidity position and well capitalized, consistent Techcombank came through very well in the uncertain
with our credit ratings which is always in line with the times. We delivered good returns to shareholders, with
national ratings. dividends reaching a record level for the past years. In
this year, the Bank sold an additional stake of 5% to
We have made a number of senior appointments to our strategic partner, HSBC, which now holds a 20%
strengthen the management of the bank’s business, stake in Techcombank. We also issued new shares to
including ones with extensive international business all existing shareholders, bringing the total chartered
experience from our strategic partner, Hong Kong and capital to VND3,642 billion from VND2,521 billion a
Shanghai Banking Corporation (HSBC), and some year earlier.
other global banks such as Citibank and JP Morgan
Chase Bank NA. We have also significantly improved The outlook for the Vietnamese economy for 2009
administration, risk control, and internal audit to ensure remains gloomy and there persists some risks from the
a sustainable rate of development commensurate with a current instability in global financial markets. However,
multipurpose and modern bank. given the strengthened capacity of the Bank, we are
confident to continue to deliver strong returns. We will
Techcombank’s performance was recognized by the continue sustainable growth through intensified risk
Prime Minister who gave the Bank a certificate of merit for management and more modern services. We will work
our considerable contribution to the government’s efforts to enhance our competitive edge to fully tap business
to help curb inflation, stabilize the macro-economy, and opportunities and confirm our leading position in
help maintain social security. The Bank also received Vietnam’s banking system.
many awards in 2008, including the Most Favored
Services Company, the Prestigious Stock Trademark, On behalf of the Board of Directors, I would like to
Vietnam’s Leading Joint Stock Company title, and the express our special gratitude to our customers, partners
Most Outstanding Financial Service Provider title, the and shareholders for their confidence in and continued
Best Trade Financing Bank title by local ministries and support for the Bank these past years. I also want to
organizations; and the Most Active Issuing Bank in Asia recognize, congratulate and thank the management
award by the International Finance Corporation (IFC). and staff for their contribution to the Bank’s solid
achievements last year when many other banks in
In addition to banking business, it is our target to Vietnam and all over the world faced considerable
develop into a strong financial group. To realize plans, difficulties. I hope you all will continue your commitment
Mr. Ho Hung Anh we gradually made new investments in securities and and hard work for our success in the coming year.
Chairman real estate. In the second half of 2008, we established
three subsidiaries with a combined capital of VND410 Ho Hung Anh
billion, including Techcombank Assets and Liabilities Chairman

2 - Annual Report 2008 Annual Report 2008 - 3

REPORT BY CHIEF EXECUTIVE OFFICER
“The year 2008 stunned many people working in the Vietnamese
banking industry, including the most experienced ones. Economic
changes at home and abroad posed big challenges to managers
who were expected to overcome the difficulties and ensure that their
firms would develop in a sustainable manner.”
The local economy went through, what is probably
considered to be a period of unsustainable growth as
evidenced by the number of large-scale investment
projects, the setting up of many securities companies
and listed firms, the growth in the number of stock
investors, commercial banks, finance investment
entities and real estates traders in early 2008.
The outcome of these excesses included a higher
inflation rate, a bigger trade deficit, a plummeting
stock market, and a crash in the property market.
To minimize the impacts of such unfavorable factors,
the Government and the State Bank of Vietnam
gradually applied a wide range of macro policies,
mainly the tightening of monetary policy, to curb
the system-wide growth of loans and the volume of
payment instruments. Meanwhile, a financial crisis
broke out in the US and spread worldwide, leading to
the collapse of several giant financial institutions with
a devastating impact on the world’s stock markets.
Under such circumstances, like other commercial
banks, Techcombank faced many business
difficulties. However, with strong financials, tight
controls and prudent, flexible management, we
weathered all the challenges and realized most
of our business targets, confirming that we are a
strong, safe and established bank and an important
link in Vietnam’s finance and banking chain.
The Board of Directors and the Board of
Management acted decisively to address the
changing environment, focused on protecting our
customer base and actively managed our liabilities,
in particular the mobilization of deposits in order to
ensure the Bank’s liquidity. In the 2008 fiscal year,
Mr. Nguyen Duc Vinh
CEO
4 - Annual Report 2008
total capital mobilized from residents and economic
entities was VND41,365 billion, surging 64.54%
against late 2007, and representing 69.68% of the
Bank’s total assets. This stable and abundant source
of funds and our dynamics in the inter-bank market
helped us to become one of few banks that managed
to maintain very good liquidity during the most
difficult times. Our Tier 1 capital ratio at 13.99% by
the end of 2008 was much higher than the standard
of 8% applied by most of nations in the world.
With strong capital and liquidity, Techcombank
was seen as a dependable partner, always able
to support customers, even under the toughest
market conditions. We continued to provide loans
to local companies, prioritized disbursement for the
economy’s key industries, and made available foreign
currencies on a regular basis to cover the imports
of essential goods. We actively controlled the credit
growth rate and limited lending to higher risk areas
such as stock investment and property speculation.
In addition to gradually centralizing the credit
appraisal process, the Bank continuously enhanced
risk management capabilities, risk monitoring and
management system, thus maintaining credit quality
and keeping non-performing loans to only 2.52% of
total outstanding loans. Total provisions accounted
for 48.72% of the non-performing loans. We also
focused on improving asset quality and increasing
liquid assets. These measures helped maintain
our strong financials and increased our income
considerably.
* Including customer deposits, valuable papers and entrusted funds
Annual Report 2008 - 5
REPORT BY CHIEF EXECUTIVE OFFICER
The year 2008 is also notified
by our continued investments in
the development and promotion
of non-credit services to meet
the diversified demands of
customers. Thus, the net fee and
commission income reached
VND483 billion, up 172.91%
against 2007.
Thanks to our persistent pursuit of sustainable
development targets, timely policies and a team effort
by the whole Bank, Techcombank made a profit before
tax of VND1,600 billion in 2008, up 125.48% against
2007, and 55% more than the initial target set in early
2008. The profit was the second biggest among those
reported by commercial joint stock banks in Vietnam,
making Techcombank a success model amid the
market crisis of 2008 when many banks had to revise
down their targets. The Bank’s return on assets (ROA)
and return on equity (ROE) increased remarkably from
1.99% and 22.98% in 2007 to 2.28% and 25.87% in
2008 respectively.
While striving to realize all business targets in 2008,
we invested sufficiently in renewing technology,
reinforced our management system, centralized
business assistance, accelerated delivery of services
to the retail sector, and further restructured corporate
customers related operations, all to enable us to
continue to implement the overall development
strategy for 2006-2010, with the goal of becoming
Vietnam’s leading commercial bank. These innovative
steps will bring about positive results once the business
environment is again favorable. This is the foundation
for sustainable growth, and for the professional and
modern operation of Techcombank.
6 - Annual Report 2008
1 2
1. Mr. Ho Hung Anh
Chairman
Date of birth: June 8, 1970
Education background: Bachelor in Electronic
Engineering
Foreign language: Russian
Mr. Ho Hung Anh has many years of experience
in corporate governance at Techcombank as stated
The year 2009 awaits us with more challenges and
below:
difficulties. However, all Techcombank managers
• From 2004 - 2005: Member of the Board of
and staff are ready to cope with and overcome them, Directors
and continue to perfect the Bank’s operations, risk
• From 2005 - August 2006: Vice Chairman of the
management capabilities and business policies to Board of Directors
maintain sustainable development, and to seize new • From September 2006 - April 2008: First Vice
Chairman of the Board of Directors
business opportunities. • From May 2008 to date: Chairman of the Board
of Directors
We firmly believe that under the leadership of the
Board of Directors and with the joint effort of all 2. Mr. Nguyen Dang Quang
managers and staff, Techcombank will continue
First Vice Chairman
to reap great success in 2009, gradually realizing
the 2006-2010 plan, and building up the image of a Date of birth: August 23, 1963
SAFE, EFFECTIVE, CONVENIENT and FRIENDLY Education background: Ph.D. in Technology,
bank, contributing to the national socioeconomic Postgraduate in Financial Management
development, and bringing about benefits to Foreign languages: Russian, English
shareholders, customers and employees. Mr. Nguyen Dang Quang has many years of
experience at the management level in Techcombank
as stated below:
On behalf of the Board of Management • From 1995 - 1998: Deputy General Director
  • From 1999 - 2002: Vice Chairman of the Board
of Directors
Nguyen Duc Vinh • From 2006 - April 2008: Advisor to Chairman of
CEO the Board of Directors
• From May 2008 to date: First Vice Chairman of the
Board of Directors
CORPORATE GOVERNANCE
Board of Directors
(2009-2014)
3 4 5
3. Mr. Ngo Chi Dzung
Vice Chairman
Date of birth: September 25, 1968
Education background: Ph.D. in Economics, Bachelor in
Geological Engineering
Foreign languages: Russian, English.
Mr. Ngo Chi Dzung has been Vice Chairman of the Board of
Directors since August 2006.
4. Mr. Nguyen Thieu Quang
Vice Chairman
Date of birth: August 28, 1959
Education background: Bachelor in Underground Construction
Foreign language: Russian
Mr. Nguyen Thieu Quang has many years of experience in
directing the operations of Techcombank as stated below:
• From 1999 - 2003: Member of the Board of Directors
• From 2003 - August 2006: Vice Chairman of the Board
of Directors
• From September 2006 - April 2008: Chairman of the Board
of Directors
• From May 2008 to date: Vice Chairman of the Board
of Directors
5. Mr. Nguyen Canh Son
Member
Date of birth: April 10, 1967
Education background: Bachelor in Construction Engineering
Foreign language: Russian
Mr. Nguyen Canh Son was member of the Board of Directors
from May 2008 to March 2009 and since then, Vice Chairman
of the Board of Directors.
Annual Report 2008 - 7
CORPORATE GOVERNANCE CORPORATE GOVERNANCE
Board of Directors Board of Supervision
(2009-2014) (2009-2014)

6 7 8 9 10 1 2 3 4 5

6. Mr. Sumit Dutta 9. Mr. Stephen Colin Moss 1. Mr. Do Tuan Anh 3. Mrs. Nguyen Thu Hien
Member Member Head cum specialist member Specialist member

Date of birth: August 7, 1966 Date of birth: February 16, 1967 Date of birth: November 2, 1973 Date of birth: October 20, 1965
Nationality: Indian Nationality: British Education background: Master in Financial Investment Education background: Bachelor in Credit Finance
Management
Education background: Bachelor of Business Education background: Bachelor of Economics and Foreign languages: Russian, English
Administration Accounting Foreign language: English
Mrs. Nguyen Thu Hien has many years of experience in the
Foreign languages: Bengali, English Foreign languages: English, French Mr. Do Anh Tuan has many years of experience in the supervisory level at Techcombank as stated below:
Mr. Sumit Dutta has several years of experience at the field of finance and banking. He became Head of the
Mr. Stephen Colin Moss has considerable years of • From January 1999 - February 2003: Specialist member
management level at HSBC. He is now Director of the Retail Board of Supervision in April 2009.
experience at the management level in the field of financial of the Board of Supervision
Banking Division of Techcombank. He became a member of accounting. He is currently HSBC’s Manager of Strategy and • From 2005 - August 2006: Member of the Board of
the Board of Directors in April 2009. Development in Asia Pacific region. He became a member 2. Mrs. Nguyen Quynh Anh Supervision
of the Board of Directors in April 2009. • From August 2006 - March 2009: Head of the Board of
Specialist member
Supervision
7. Mr. Tran Thanh Hien • From April 2009 to date: Specialist member of the Board
Member 10. Mr. Nguyen Duc Vinh Date of birth: February 25, 1971 of Supervision
Member Education background: Master in Education Science
Date of birth: April 9, 1963 and Postgraduate in corporate governance models
4. Mrs. Vu Thi Dzung
Education background: MBA Date of birth: September 16, 1958 Foreign languages: English, Russian
Member
Foreign language: English Education background: MBA Mrs. Nguyen Quynh Anh was member of the Board of
Mr. Tran Thanh Hien became a member of the Board of Foreign languages: English, French Supervision between May 2008 and March 2009. She Date of birth: February 15, 1975
Directors in April 2009. became a specialist member of the Board of Supervision
Mr. Nguyen Duc Vinh has been Chief Executive Officer of Education background: Bachelor of Accounting and Finance,
Techcombank for nearly 10 years and became a member of in April 2009.
Auditor
8. Mr. Madhur Maini the Board of Directors in April 2009.
Foreign language: English
Member Mrs. Vu Thi Dzung has many years of experience in the field
of accounting and finance. She became a member of the
Date of birh: August 6, 1973 Board of Supervision in April 2009.
Nationality: Indian
Education background: Bachelor of Economics, Bachelor 5. Mr. Nguyen Quynh Lam
of Application Science Member
Foreign language: English
Mr. Madhur Maini has years of experience managing Date of birth: December 30, 1965
big US financial groups in Southeast Asia. He became a Education background: Bachelor in Mining Economics
member of the Board of Directors in April 2009.
Mr. Nguyen Quynh Lam was a specialist member of the
Board of Supervision between May 2008 and March 2009.
He became a member of the Board of Supervision in
April 2009.

8 - Annual Report 2008 Annual Report 2008 - 9

CORPORATE GOVERNANCE CORPORATE GOVERNANCE
Board of Management Board of Management

1 2 3 4 5 6 7 8 9 10

1. Mr. Nguyen Duc Vinh 4. Mr. Nguyen Thanh Long 6. Mr. Le Xuan Vu 9. Mr. Gary Matthews
President and Chief Executive Officer Executive Vice President Executive Vice President Chief Operating Officer

Date of birth: September 16, 1958
Education background: MBA
Foreign languages: French, English
Mr. Nguyen Duc Vinh was Deputy General Director of Vietnam
Airlines before joining Techcombank. When Vietnam Airlines
bought a stake of Techcombank, the Board of Directors of
Techcombank appointed Mr. Vinh to the position of Deputy
General Director.
Mr. Vinh was appointed President and Chief Executive Officer
of Techcombank in December 2000.
5. Mr. Tran Hoai Phuong
2. Mrs. Nguyen Thi Tam
Executive Vice President
Date of birth: February 20, 1960
Education background: Bachelor of Economics, MBA
Foreign language: English
Mrs. Nguyen Thi Tam had many years of experience in
banking prior to joining Techcombank in 1994. Mrs. Tam has
since held the following positions: Deputy Director of Business
Center, Head of Foreign Relations Department, Head of
Corporate Banking Department, and Director of Head Office’s
Business Center.
Mrs. Tam was appointed as Executive Vice President in
September 2004.
3. Mr. Pham Quang Thang
Executive Vice President
Date of birth: March 14, 1973
Education background: Master in International Accounting
Foreign language: English
Mr. Pham Quang Thang has many years of experience in
the fields of finance and banking. Mr. Thang held important
positions at Techcombank, including Head of the Accounting
Department and Corporate Planning Department and Director
of the Treasury Center.
Mr. Thang was appointed as Executive Vice President in
October 2007.
Date of birth: July 19, 1966
Education background: Master in Economic Law
Foreign language: English
Mr. Nguyen Thanh Long has many years of experience
in the fields of finance and banking. Prior to joining
Techcombank, Mr. Long held the position of Deputy Chief
of the Legal Department at the State Bank of Vietnam.
Mr. Long was appointed as Executive Vice President of
Techcombank in November 2007.
Executive Vice President
Date of birth: October 20, 1964
Education background: Bachelor of Foreign Trade,
postgraduate in International Economics
Foreign languages: English, French
Mr. Tran Hoai Phuong has many years of experience
in the fields of banking and finance. His first position
was as financial analyst at Banque Nationale de Paris,
Ho Chi Minh City Branch. Later, as Head of Corporate
Banking, he was among the key persons who worked
out a development strategy for Standard Chartered
Bank in Vietnam. He then joined Citibank Vietnam and
held the positions of Head of Business Development
and Head of Ho Chi Minh City Branch at which time he
was in charge of building the SME banking model for the
bank in the Vietnamese market. Mr. Phuong also spent
a short time with the Empower Securities Co. Ltd. at the
management level.
Mr. Phuong was appointed as Executive Vice President
of Techcombank in September 2008.
Date of birth: October 21, 1971
Education background: MBA
Foreign language: English
Mr. Le Xuan Vu has many years of experience in information
technology. He held positions such as Head of the IT
Department and Director of the IT Center before being appointed
as Executive Vice President cum Director of IT Center in
January 2008.
7. Mrs. Luu Thi Anh Xuan recent position is Managing Director – Group Head of
Executive Vice President
Date of birth: April 4, 1970
Education background: MBA
Foreign language: English
10. Mr. Anthony Guerrier
Mrs. Luu Thi Anh Xuan has many years of experience in the
fields of finance and banking. Before working at Techcombank,
Mrs. Xuan held senior positions at a number of international
banks, including Citibank, ABN AMRO Bank and Deutsche
Bank. Her previous roles included Director of Payments and
Trade Finance and Head of the Business Department.
Mrs. Xuan was appointed as Executive Vice President in
February 2007.
8. Mr. Jonathan Crichton
Chief Risk Officer
Date of birth: September 28, 1955
Education background: BA (Comb Hons) History and Politics;
Diplome I.E.H.E.I
Nationality: British
Languages: English, French
Mr. Jonathan Crichton has almost 30 years working experiences
with HSBC system around the world in different activities such
as Risk, Personal Financial Service, Internal Audit, Commercial
Banking, and Marketing. His most recent position is Head of
Credit HSBC France.
Mr. Jonathan was seconded to Techcombank and appointed as
Chief Risk Officer in June 2009.
Date of birth: December 11, 1964
Nationality: British
Language: English
Mr. Gary Matthews is a Banking Operations professional
with over 20 years experience in the management of
large, functionally diverse, cross cultural teams gained
in multiple roles and varying locations with a proven
track record of driving process risk reduction coupled
with productivity improvement through functional
centralization and process outsourcing. His most
Wholesale Banking Operations and Technology at DBS
BANK Singapore Branch.
Mr. Gary was appointed as Chief Operating Officer of
Techcombank in July 2009.
Chief Financial Controller
Date of birth: March 23, 1970
Education background: Bachelor of Economics,
Business Degree in Accounting and Finance
Nationality: French
Languages: French, English
Ms. Anthony Guerrier has many years experience in
banking. He worked for ERNST & YOUNG - Toulouse,
France as Banking sector Manager for a long period
of time prior to joining HSBC in 2000 and held several
positions including Head of Management Information &
Planning and Manager for Accounting and Regulatory
Platforms at HSBC Paris, and Chief Financial Officer at
HSBC Bordeaux.
Mr. Anthony was seconded to Techcombank and
appointed as Chief Financial Controller in July 2009.

10 - Annual Report 2008 Annual Report 2008 - 11



11

Education

in June 2009.
in August 2008.
Nationality: Indian

12 - Annual Report 2008

Director, Treasury
11. Mr. Sumit Dutta

Nationality: Indonesian
background:
Director, Retail Banking

Date of birth: August 7, 1966

Languages: Bengali, English

Treasury in Citibank Jakarta.

12. Mr. Bimo Notowidigdo

Date of birth: November 8, 1975

Languages: Indonesian, English

12

Bachelor
Administration, Jadavpur University, India
of

Education background: Bachelor of Economics

Board of Management

e-Business and Direct Sales, HSBC New Jersey.

Mr. Sumit was seconded to Techcombank and appointed
the management level of HSBC. He has held several

as Director of the Retail Banking Division of Techcombank

of Consumer and Sales Management and Head of
senior positions including Senior Vice President, Head
Mr. Sumit Dutta has several years of experience at
Business

Product Management of HSBC USA, and Head of Global

Mr. Bimo was appointed as Director of the Treasury Centre

Techcombank. His most recent position is Director/Country
Kuala Lumpur and Singapore for 10 years before he joined
Mr. Bimo Notowidigdo worked for Citibank in Jakarta,

13
CORPORATE GOVERNANCE

April 2009.
June 2009.

Director, Marketing
14

Asia, Bangkok, Thailand.

Foreign language: English

14. Mrs. To Thuy Trang

13. Mr. Nguyen Van Tho

Resources in Citibank Vietnam.

Date of birth: January 13, 1974

Director, Human Resources

Date of birth: December 16, 1954

Foreign languages: English, Japanese

Education background: Bachelor of Economics

Mrs. To Thuy Trang has about 10 years experience in the

Mrs. Trang was appointed as Marketing Director in

Product Director of Kao Consumer Product Southeast
field of marketing. Her most recent position was Skincare
Education background: BA Degree, Post-graduate Diploma

Mr. Tho was appointed as Human Resources Director in

before joining Techcombank was Head of Country Human
the field of Human Resources. His most recent position
Mr. Nguyen Van Tho has many years of experience in

SHAREHOLDERS’ MEETING

BOARD OF DIRECTORS BOARD OF SUPERVISION

2. NOMINATION AND EXCO BOARD OF DIRECTORS OFFICE 3. STRATEGIC INVESTMENT COMMITTEE

1. AUDIT AND RISK COMMITTEE
REMUNERATION COMMITTEE

BOARD OF MANAGEMENT CREDIT COMMITTEE

4. IT STEERING COMMITTEE 5. ASSETS AND LIABILITIES COMMITTEE

6. Corporate 7. Retail 8. Treasury 9. Human 10. Credit Risk 11. Market and 12. IT Center 13. Legal and 14. Operations 15. Advisory
Banking Banking Center Resources Management Operation Risk Compliance Division Division
Division Division Division Division Management Division
Division

- Business and - Deposit Product - MM Department - Recruitment - Credit Risk - Technology - Planning and - Legal and - Operations - Marketing
Market Analysis Management Department Department Risk Project Compliance Center Department
Department Center - Investment - Credit Risk Model Department Department Control
department - Salary and Department Department - Center of Credit - Corporate
- Product - Wealth Remuneration - P. TD H.O - Procedure and - Security Administration Planning
Management Management - Global Futures Department Product Risk Department - Internal Audit Department
- Central Appraisal
Department Center and Department Department Department - Cash & Vault
Commodities - Personnel - Southern Appraisal - Application Department - Accounting
- Northern and
- Lending Product Department Information Department - Market Risk Department - Debt Collection Department
Central Trade
Management Management Department Department - Construction
and Cash - Project Appraisal
Center - Bond and Policy Department - Card and Management - MIS Project
Management
Department Department - Operation Risk E-Banking Department
Department - H.O M.Banking
- Card Product Department Department Department - FI Department
- Southern Trade Center - FX Department - Training Center - Administration
- Southern
and Cash M. Banking - Asset, Liability - Infrastructure Department
Management - Sales and - R&D Department Risk Telecommunications
Department Services Center Department - Problem Loans Department Department - Quality
Department Management
- SME - Channel - Southern FX - Collateral - Business - Central IT Department
Department Strategy and Department Management Continuity Department
Distribution Department HO Department - Card
- Big Corporate Center - Interbank - Southern IT Management
- Collateral
Department Customer Management - MIS Department Department and Operation
- Retail Credit Services Department for Center
- Customer Center Department Southern
Service Branches
Department - Credit Control
Department H.O
- MSME Center
- Southern Credit
Control Department

Techcombank Asset
Techcom Securities Co., Ltd Techcom Fund Management Co., Ltd 15. Branches, Sub-branches, TSOs
Annual Report 2008 -

Management Company Ltd

Organizational Chart
Corporate Governance

13
 Committed to make a
difference

“One of Techcombank’s strategies

is to become the leading retail bank
in Vietnam. To achieve this end, we
have made substantial improvements
in the operating structure to serve
our customers in a more professional
manner.”

14 - Annual Report 2008 Annual Report 2008 - 15

Retail Banking
One of Techcombank’s strategies is to become
the leading retail bank in Vietnam. To achieve this
end, we have made substantial improvements in
the operating structure to serve our customers in a
more professional manner. Additionally, a full scope
of innovative and customized products and service
convenience were introduced to better meet the
various financial demands of individual customers.
Special attention was given to the diversity and
convenience of products and service quality as well
as enhanced delivery channels aimed at increasing
customer accessibility to these services.
The Bank had more than 517,000 personal accounts
with a total outstanding balance of VND1,146 billion
as of 31 December 2008. Retail banking currently
contributes over 20% to total revenue, and is expected
to grow in the near future.
16 - Annual Report 2008
Retail Banking Model Completely
Restructured
Retail banking activities are continuously improved
in terms of structure through the organization and
establishment of specialized centers under the Head
Office’s Personal Financial Services Division (PFS),
which help us to better meet customers’ demands.
The Division currently includes:
• Deposit Product Management Center
• Lending Product Management Center
• Retail Credit Center
• Card Product Center
• Wealth Management Center
• Channel Strategy and Distribution Center
• Sales and Services Center
A number of branches and sales outlets have been
adjusted to focus on serving individual customers.
Fast, Convenient and Secured During the fluctuations in the financial market in 2008,
Access Channels Techcombank closely monitored market information
as well as customers’ savings and investment
The Bank expanded its network to 169 branches preferences to decide on an appropriate interest rate
and sales outlets in cities and provinces across the policy to meet customers’ needs as well as retain and
country. The Contact Center at the Head Office was win new deposit business. Several savings promotion
upgraded to become a ‘reliable friend’, specialized in programs were launched such as Lucky Spring
providing information, consultancy and answers to Deposit, Super Lucky Savings, and Win Comfortable
customers’ inquiries 24/7 with a capacity of serving Prizes from Secured Deposits with total prizes worth
almost 50 customers at the same time. approximately VND10 billion. These programs
rewarded many lucky customers.
In Internet banking, we continued to affirm our leading
position among banks in Vietnam with real web-based Along with efforts to affirm the brand name of a
services of international standards. The F@st I-bank secure and effective Bank, we successfully improved
package for individuals and F@st E-bank package for and expanded our customer base, and maintained a
corporate clients allow customers not only to make stable source of funds for our lending and investment
inquiries about their account balance but also to make activities. The Bank has won the trust of more and
transfers to accounts with Techcombank and with more customers.
other banks. Customers can also make payments for
credit cards, deposit on a regular basis, set automatic These efforts have brought about several positive
payment calendars, schedule automatic payments, results. Deposits by individuals grew rapidly despite
as well as perform other transactions. fluctuations, contributing to the high liquidity of
the Bank. As of late 2008, total personal customer
We provide another effective access channel to deposits were VND29,779 billion, up 110.91% against
customers via our website with full information on the 2007, accounting for 71.99% of the Bank’s total
bank’s products and services, detailed instructions mobilized funds. This was among the highest growth
on using Internet Banking, list of direct sales outlets,
ATM locations etc.
Varied saving products, suitable with
investment and saving demands of
individuals
By studying investment, saving demands and
habits of individual customers in different regions
nationwide, Techcombank introduced multiple flexible
savings and deposit products, offering a wide variety
of choices: installment savings, savings with interest
paid before maturity/at maturity/on a regular basis,
savings with fixed or flexible interest rates etc. We
also offer short-term investment products for large
amounts, enabling customers to optimize returns
on their otherwise idle funds or to proactively make
appropriate financial plans for each phase of their
lives.
Annual Report 2008 - 17
Retail Banking (Continued)

rates of local commercial banks in the year. Moreover, Boosting Consumer Loans, Financing TOTAL OUTSTANDING HOME LOANS AND We separated the card operation from the business
95.13% was in term deposits, while 22.41% was in Personal Investment CONSUMER LOANS (BLN VND) system by establishing the Card Management and
foreign currencies that helped the Bank to be more 4,500 Operations Center in April 2008. This structural
4,200
proactive in using funds. Techcombank supported financing to individuals adjustment has helped improve service quality and
4,000
whose capital demands varied from supporting 3,521
enabled the Bank to be well prepared to receive a
their living and consumption needs to carrying out 3,500 3,386 large number of customers in the coming years.
Personal customer deposits (Bln VND) investment plans and private business activities. 3,000 Improvements in the quality of our card services live
However, due to numerous difficulties in the market in up to the goal “fast issuance, stable system, flexible
2,500
29,779 2008, we reduced the growth rate of total outstanding and prompt response to customers’ requests.” This
30,000 loans for personal customers. 2,000 increased customer convenience in using credit cards
1,500
1,506 and led to Techcombank being highly appreciated by
25,000 all partners.
1,000
Retail outstanding loans (Bln vnd)
2,000 500 Best Visa Card Issuer
7,954
14,119 7,480 0
1,500 8,000
Techcombank was recognized as the best Visa card
Home loans Consumer loans
issuer in Vietnam in 2008 with a total number of
1,000
6,684 6,000 2007 2008
100,000 Visa debit and credit cards out of 300,000
3,892 cards issued by the bank during the year. By end of
500
2,129 4,000 Card and E-payment Services Keep Growing 2008, the total number of all types of cards issued
2,817 was 601,884, of which 458,428 were domestic debit
0
2004 2005 2006 2007 2008 1,560 In 2005, Techcombank was known as the first bank cards, and 143,416 were Visa debit and credit cards.
2,000
940
in Vietnam to successfully connect its card system
with Vietcombank to form the first card alliance in The Bank is now one of the three biggest international
0 Vietnam. Last year, Techcombank was also the first card issuing banks in Vietnam with a market share
Breakdown of personal 2004 2005 2006 2007 2008 bank to connect our card system with SmartLink and of 14%. With our plan to issue MasterCard cards in
customer deposits Banknet – the two largest card alliances in Vietnam, 2009, Techcombank will gain a remarkable expansion
4.87% and with our strategic partner HSBC Vietnam. Thanks in card services.
Our strategic products – Home loans and Consumer to those connections, Techcombank cardholders
loans - continued to increase, while other products can use their cards at over 7,000 ATMs and 14,000
such as overdrafts, gold trading loans, stock trading POS nationwide, including 360 ATMs and 2,000 POS
loans, overseas study loans, and valuable paper owned by the Bank.
mortgage loans produced good results. With overdraft
loans, customers can take an unsecured credit equal The year 2008 also marked membership and full
to 10 months’ salary. connection of Techcombank with the Visa International
95.13%
group, which allows Techcombank Visa cardholders
Total consumer lending as of late 2008 was VND3,386 to use their cards at more than one million ATMs
billion, an increase of 124.83% against 2007, while and millions of Visa POS worldwide. Techcombank
home loans remained high at VND3,521 billion. On has also joined and connected with MasterCard,
average, each home loan amounted to VND500 and is now preparing for the issue of Techcombank
Demand deposits Term deposits million. MasterCard in the near future.

18 - Annual Report 2008 Annual Report 2008 - 19

Retail Banking (Continued)

Number of issued cards by 31 dec 2008 payment turnover via pos (vnd bln)

300
272
137,303
250
217
200
6,113

150

100
458,428
50

0
Techcombank Techcombank Techcombank Visa 2007 2008
F@stAcess Visa International International credit
domestic debit debit cards cards
cards

Strong Growth in Card Payment
and E-payment
The Bank launched a series of promotional programs
to encourage and get customers into the habit
of using modern card products, such as free-of-
charge card issuance programs, tickets to Morning
Star Singing Competition 2008, “Discovering
Beijing, Enjoying Olympic 2008,” “Saving points for
shopping, accumulating points for traveling,” and
customer care programs in cooperation with Nokia
and MobiFone.
The number of transactions at ATMs and POS,
therefore, surged, with the total withdrawn and
transferred amount through ATMs in 2008 reaching
VND7,744 billion, up 146.86% against 2007. In
the context of the economic crisis in 2008 and the
resultant drop in consumer spending, the transaction
value via POS still increased by 25.35% to
VND272 billion.
The Bank also introduced and improved electronic
payment channels such as Internet Banking
(F@st i-bank), and F@st Mobipay. By the end
of 2008, 8,286 customers had registered for
F@st i-bank, resulting in a surge in the number of
transactions with approximately VND190 billion per
month late last year. Although it was a new initiative,
the mobile phone payment channel F@st Mobipay
was widely accepted by customers.
Wealth Management Services Deployed
Wealth management services have long been
popular in developed countries. However, the
acceptance in Vietnam is generally slower, partially
due to the culture of Vietnamese people to want
to decide their spending and investments on their
own. In order to invest successfully, investors
have to spend time and money enriching their
knowledge, gaining experience, etc. Realizing it
is a considerable challenge for many investors, solutions designed for each, customers are able to
thus in 2008, Techcombank established the Wealth both minimize risks and increase their asset.
Management Center with the aim to help customers
invest professionally and effectively and focus on In addition to the aforementioned services,
other financial goals at the same time. This marked Techcombank has introduced Bancassurance
an important step in completing our organization products, including Education Savings and Bao Gia
and services to realize the strategy of becoming a Savings. These are installment savings products
leading retail bank, providing a wide range of high- with competitive interest rates and tenors, helping
quality products and services to retail customers. customers save funds for future plans. Customers
can buy life insurance with high compensation for
Techcombank wealth management experts will each product.
provide customers with important and accurate
market information on the economy, finance,
securities, deposit and lending interest rates, etc.
as well as analysis on investment trends, currency
forecasts, domestic and world gold prices. Based on
the analysis of customers’ financial status and needs,
we help them develop and manage their investment
portfolio professionally and effectively. With individual

20 - Annual Report 2008 Annual Report 2008 - 21

Corporate Banking
Techcombank attaches special attention to traditional
products and services targeting enterprises. Having
deep understanding of the specific operations and
demands of certain groups of businesses, the Bank
offers specialized products and services for different
market segments, such as large corporations,
medium-sized enterprises (MMEs), small and medium-
sized enterprises (SMEs), micro, small and medium
enterprises (MSMEs) and trading households. In 2008,
Techcombank continued to make radical changes
in the organizational structures of the Head Office,
branches and sales outlets (TSOs) in order to serve
business customers in a more professional manner.
Techcombank conducted market research for each
segment in order to develop and offer appropriate,
competitive and flexible financial solutions and products.
Commercial banking services for SMEs continued to
22 - Annual Report 2008
be the Bank’s core business. In 2008, Techcombank
implemented a business strategy targeting SMEs in
line with the consultancy of the IFC, a part of the World
Bank (WB). This strategy is consistent with responding
to the needs of current corporate customers and to the
Bank’s vision for 2010: to become a leading bank in
terms of diversity, reliability, quality and efficiency.
Acknowledging our efficient operations and reputation,
many large multilateral financial institutions such as
World Bank, the Asian Development Bank (ADB)
and the Swiss State Secretariat for Economic Affairs
(SECO) has chosen Techcombank as a disbursement
bank for their projects which help SMEs gain access to
soft loans to renew technology and buy environmentally
friendly and energy-saving equipment.
By the end of 2008, Techcombank had more than
26,600 corporate customers who accounted for
around 70% of the Bank’s outstanding loans, and
contributed a large proportion to total revenues.
Structure of corporate customers
31%
1%
8%
60%
Big Corporations MME SME MSME
Effective Financial Management Solutions
and Investment Channel
Utilizing Techcombank’s account services, customers
can manage their corporate finances simply and
conveniently. For large corporate customers, the
Bank’s cash management solutions allow them to
closely monitor cash flows so they can optimize
business results.
Early last year, the Bank launched a service for
overnight investment using the current accounts
called F@st Invest which offers higher interest rates,
thereby helping enterprises utilize their idle capital
in the most efficient manner. Thanks to the service,
Techcombank’s deposit mobilization increased during
the liquidity squeeze in the financial markets. The
total deposits by economic institutions as of late 2008
were VND11,312 billion, up 12.48% against late 2007.
Of this total, term deposits made up 54.59%, and
deposits in foreign currencies accounted for 16.76%.
Deposits by economic institutions (Bln VND)
12,000 11,312
10,057
10,000
8,000
6,000
4,000
2,882
2,096 2,382
2,000
0
2004 2005 2006 2007 2008
Timely, Flexible Credit Provision
Keeping in mind that enterprises are not only
customers, but also business partners, Techcombank
always stands side by side with enterprises, especially
SMEs and import-export enterprises affected by
shrunken markets, higher dollar prices and tightened
credits. With strong financial health and the right
business strategies, Techcombank continued to
disburse loans and advances, ensuring liquidity for
economic contracts of enterprises, thus becoming an
indispensible partner in the financing of companies in
2008, a year full of difficulties.
Techcombank set aside VND3,000 billion for funding
enterprises operating in key economic sectors last
year, especially for purchasing and processing rice,
coffee, cashew nuts and pepper to boost exports.
Annual Report 2008 - 23
Corporate Banking (Continued)

Loans were also offered with lower interest rates to
enterprises which import materials and equipment for
production and business expansion. This policy was
aimed at creating favorable conditions for enterprises
to overcome their financial difficulties in order to
develop and expand business, contributing to the
country’s economic growth.
Total outstanding loans and advances to economic
entities reached VND18,388 billion as of 31 December
2008, up 47.36% against 2007.
Along with promoting credit activities in 2008,
Techcombank centralized credit appraisal process,
approval, credit support and customer care services.
These measures have helped the Bank to better
monitor loans, and kept non-performing loans at
relatively low levels amid the economic crisis which
saw many enterprises racking up losses or even
going bankrupt.
Lending to Support Business Operations
For SMEs, Techcombank focuses on financial
services that help companies optimize their cash flow
thus sharpening their competitive edge. The Bank’s
flexibility in responding to customers borrowing
needs means that loans are timely provided to
enterprises so that they can handle emergencies or
unexpected cash shortages via short-term working
capital financing or overdraft financing.
For large corporate customers, the Bank prioritizes
the availability of funds for separate projects.
For MSMEs and household businesses in 2008,
Techcombank took the lead in providing this important
sector with standardized financial packages such as
“Micro-banking financing” and “Supplier financing”.
These packages have clear term sheets, quick
lending procedures, and flexible collateral, suitable
to trading households and MSMEs operating in
various fields.
International Payment and Trade Finance
Techcombank took the initiative in launching new
products and services such as export financing with
preferential interest rates and export bills collection
to create more convenience and added value
services to customers and to improve the Bank’s
operation efficiency.
With a wide network of correspondent banks in nearly
100 countries in the world, we continued to confirm
our position as the best bank in terms of international
payments and trade finance among joint stock
banks in Vietnam. The total international payment
volume increased 23.81% in 2008 to USD3.37 billion,
contributing VND176 billion to the Bank’s net profits.
Techcombank was also the first bank in Vietnam for
which the IFC raised its guarantee limit up to USD50
million in the framework of the Global Trade Finance
Program (GTFP) for issuing banks.

Outstanding loans to economic institutions Outstanding loans to economic International payment volume (million USD)
(billion VND) institutions by sector

7.5%
20,000
3.5% 3,370
3,500
18,388 2.2%
3,000 2,722
15,000
12,478
2,500
17.3%

10,000 2,000

5,993 1,500 1,342

5,000 1,014
3,819 17.6% 1,000
2,525
520
500
0 51.8%
2004 2005 2006 2007 2008
0
Agriculture & Forestry Trading Manufacturing 2004 2005 2006 2007 2008
& Processing
Construction Logistics, Transportation &
Communication
Hotel Industry Others

24 - Annual Report 2008 Annual Report 2008 - 25

CORPORATE BANKING (CONTinued)

Guarantee Business Techcombank has continuously invested in technology to

In October 2008, Techcombank received the “Most
Active Import Financing Bank in East Asia” award
from the IFC. In February 2009, Techcombank was
awarded the 2008 Outstanding Trade and Service
Enterprise title, and was recognized as the Best
Trade Financing Bank in Vietnam in 2008.
INTERNATIONAL PAYMENT INCOME (BLN VND)
200
176
The Bank’s local guarantee business continued to
expand, making a considerable contribution to fee
income. Total guarantee fees reached almost VND57
billion, representing around 10% of the Bank’s total
fee income.
Techcombank’s guarantees are accepted by many
foreign and domestic banks and enterprises because
of the Bank’s strong financials and well established
reputation in the market. Currently, we provide the
following types of guarantees:
• Bid bond guarantees
• Performance guarantees
• Advance payment guarantees
• Warranty guarantees
• Payment guarantees
• Loan guarantees
• Counter guarantees
• Other guarantees  In addition to offering basic foreign exchange rate risk
Foreign Exchange Trade and
Commodities Futures
Along with strengthening international payment
channels to boost import-export activities of
enterprises, Techcombank actively trades on the
interbank forex market to ensure the availability of
foreign currency to better serve customers. Through
forward contracts our customers are protected from
fluctuations in forex rates. The total forex trading
volume in 2008 was up 132.70% to VND198 trillion
(USD12.37 billion).
FX Trading Volume (Bln VND)
120,000
102,589
100,000 95,359
acquire the most modern electronic trading platforms and
information systems from such providers as Reuters and
Bloomberg. We have also completed internal processes
with close linkages between the Front Office, Back Office
and Middle Office, and frequently standardized risk
management activities.
We are currently the first joint stock bank in Vietnam
that provides derivative services to help enterprises
manage risks relating to changes in prices in general
and forex rates in particular. Using electronic transaction
systems linked to international trading floors such as
LIFFE, NYBOT, NYMEX, CME and TOCOM, we offer
price fluctuation protection services to producers and
processors of such agricultural products as coffee,
cocoa, sugar, rice, soy bean, wheat and corn, as well as
importers and manufacturers of ferrous metals, copper,
lead, aluminum, zinc, tin and nickel.
management services such as Forward, Swap, and
Option, Techcombank has combined credit operation
and forex operation to provide a comprehensive solution
to help enterprises access soft loans and benefit from
common forex rate guarantee through an export
assistance program with total funding of VND3,000
billion.
In preparation for 2009, predicted to be a year full of
changes, challenges as well as opportunities in money
and foreign exchange markets, Techcombank has
concentrated on developing products and raising service
quality, mainly targeting corporate customers. Together
with refining its structure and process, Techcombank
will continue to actively trade in the interbank market
to confirm its position as a leading joint stock bank in
treasury and forex trading.

150
80,000

100 60,000
86
45,131
39,934
54 40,000
50 40
25 20,000

0 0
2004 2005 2006 2007 2008 Buying volume Selling volume
2007 2008

26 - Annual Report 2008 Annual Report 2008 - 27

 Adding value to
relationship

“Techcombank is one of the leading

urban banks in terms of credibility,
quality and efficiency.”

28 - Annual Report 2008 Annual Report 2008 - 29

Investment Banking
Techcombank is promoting modern investment
banking services, which are now considered one of
three main pillars for increasing revenue.
The year 2008 saw sharp fluctuations in interbank
interest rates, which posed challenges to treasury
activities and the liquidity position of commercial
banks. In this environment, we confirmed our financial
strength and achieved certain breakthroughs.
Total funds mobilized from economic entities and
individuals increased considerably. The loans to
customer deposits ratio were always at safe levels,
standing at 76% by the end of June 2008 and 66%
by the end of 2008.
Having a strong and stable liquidity position, the Bank
has not only ensured effective performance but also
made positive contributions to the operation of the
domestic financial market. Our timely and substantial
30 - Annual Report 2008
investments in government bonds reinforced our
liquidity and generated profits when interest rates
went down. When interest rates were highly volatile
last year, this investment channel proved really
efficient. As a result, bond trading made total net
revenues of VND931 billion in 2008, compared with
VND82 billion in 2007.
Techcombank also gradually engaged in new
investment operations, including investments in
securities and real estate. In the second half of 2008,
three subsidiaries were established with combined
capital of VND410 billion, including:
• Techcombank Assets and Liabilities Management
Company Limited (Techcombank AMC) with a
registered capital of VND70 billion, established in
July 2008.
• Techcombank Securities Company Limited
(Techcom Securities) with a registered capital of
VND300 billion, established in October 2008.
• Techcombank Capital Company Limited (Techcom
Capital) with a registered capital of VND40 billion,
established in November 2008.
Techcombank AMC initiated activities to serve the
Bank and our customers such as logistics, collateral
management, assets management and safe custody
services to enhance the Bank’s asset quality and
service level. Techcom Securities and Techcom
Capital are still in the initial development stages of
building up systems and operations and should be
ready to meet market demands and tap business
opportunities in 2009.
Annual Report 2008 - 31
Risk Management

Risk Governance

BOARD OF DIRECTORS

Audit and Risk Asset and Liability

Committee Committee

BOARD OF MANAGEMENT

Credit Risk Management Operational and Market

Division Risk Management Division

Credit Risk Credit Appraisal/Approval Operational Risk

Collateral Evaluation and Asset and Liability

Credit policy
Management Management

Market Risk (MM, FX,

Problem Loan Management
securities, commodities)

Techcombank is fully aware that banking business
is closely associated with risk, and risk management
capability is fundamental to success. This factor is
even more important in the face of the current crisis
of the world economy, of the increasingly fierce
competition in the business environment of Vietnam,
as well as the mushrooming of sophisticated financial
products and services which may expose a financial
institution to substantial risks.
Our Board of Directors and the Board of Management
have thus decided to apply international criteria
to identify, assume and manage risks before they
become problems. Our risk management is based
on hi-tech platforms which facilitate application,
development and then integration of technology-
based solutions, and on qualified personnel who
can master such advanced management tools. This
system, which is completely centralized and separate
from the business side of the Bank, is now working
effectively to help the Board of Management balance
“risk and reward,” resulting in the soundness and
efficiency of the Bank’s total business activities.
Board of Directors: approves resolutions of the
Audit and Risk Committee and the Asset and
Liability Committee; supervises the design of
procedures and policies which manage the overall
risk of the Bank as a whole.
Board of Management: reports to the Board of
Directors on the efficiency of risk management
and compliance with respect to preset limits.
Credit Risk Management Division and
Operational and Market Risk Management
Division: proactively run policies with respect to
credit, market and operational risks.
Credit Risk
Credit risk is substantially associated with loans
granted to customers. Credit risk materializes in cases
where a customer does not repay in full the principal
and/or interest of the loan granted or is overdue on
principal and/or interest.
Techcombank has developed a comprehensive risk
management framework to identify and monitor credit
risks. We have advanced scoring and rating systems
with the Basel approach to assess the creditworthiness
of clients and measure all possible risks. Based on
those systems, the Credit Risk Management Division
will work out clear credit policies with suitable limits
and management plans for each segment and
each client.

32 - Annual Report 2008 Annual Report 2008 - 33

Risk Management (Continued)
Currently, the Credit Risk Management Division is
organized to focus on the following tasks:
• Building and refining internal scoring systems for
each category of customers such as Individuals,
Big Corporations, SMEs and Micro SMEs.
• Monitoring loan portfolio: conducting analysis
and consulting on the creditworthiness of sectors/
industries; setting limits for each sector/industry,
and making reports on loan portfolio.
• Developing tools and reports to monitor and
manage Key Risk Indicators (KRIs).
• Doing regular checks and refining the quality of
the credit management system.
• Developing other Credit Management Models
such as LGD, EAD, Pricing Models/Facilities
Profitability.
Market Risk
Market risk is the potential negative change in value of
the Bank’s positions as a result of changes in market
prices (interest rates, margins, currency, equity and
commodity prices).
In 2003, Techcombank was the first bank in Vietnam to
successfully deploy a market risk monitoring system,
which has been continually extended and improved
since then. In 2008, the system was upgraded with the
most advanced techniques and properly customised,
focusing on detecting and minimizing risks relating to
the trading of FX, MM, securities, commodities…
To deal with risks associated with FX transactions,
in 2008, Techcombank already completed the
following steps:
• Setting limits for all currencies.
• Developing and applying KPIs for dealers that, in
turn, help set limits for each dealer.
34 - Annual Report 2008
• Building up and upgrading criteria to select
To deal with risks associated with commodities
counterparties and determine limit for each
trading, Techcombank relies on:
counterparty.
• Monitoring P&L of FX transactions per currency and
• Building up and deploying specific risk measuring
per type of transaction (spot, forward, swap).
models and working out monitoring procedures for
each kind of commodity and each market.
To deal with risks associated with MM transactions,
• Building up a customer scoring system based on the
the Market Risk Department of Techcombank
scoring system for business clients; and adjusting
currently applies the following measures:
limits for each client regularly.
• Applying clear criteria to select counterparties and
• Building a model for identifying and measuring
determine limits for each counterparty.
interest risk and liquidity risk.
• Making deep dives into market fluctuations and
• Involving directly in monitoring the compliance
giving out forecasts and warning messages if
of policies, procedures, decisions in the daily
necessary.
operations of the Treasury Center; with the right to
stop any transaction if non-compliance is detected.
Asset and Liability Risk
• Making daily reports and special reports on extra-
ordinary cases to the Board of Management and
The structure of the balance sheet is made of the
the relevant units.
weight of each asset type, asset diversification which
represents one of the key factors affecting P&L of the
To deal with risk associated with investment
Bank. The tendency to maximize profit by adjusting
securities, Techcombank focuses on the following
structure of the balance sheet leads to the loss of
tasks:
control of mismatches regarding term, interest,
currency which, in turn, translate into illiquidity
• Building up a scoring system for investment
of the Bank. The temptation to increase fee and
securities, to identify an optimal investment portfolio.
commission income by adding up the number and
• Building up models for monitoring and measuring
complexity of off-balance sheet items poses potential
the P&L of portfolio.
risks on the P&L of the bank if those risks are not
• Setting limits for sectors/industries applicable to
properly managed.
investment portfolio based on issuers, industry,
main business, geography...).
• Marking the portfolio to market regularly.
• Building up a stress test model of business
environment that affects the investment portfolio.
• Monitoring portfolio investment activities.
• Reporting to the Board of Management on
investment activities and proposing measures to
manage risks efficiently.
Annual Report 2008 - 35
Risk Management (Continued)
To deal with risks associated with the balance
sheet, Techcombank emphasizes:
• Controlling size, structure, P&L of assets and
liabilities.
• Identifying and analyzing risks in assets and
liabilities.
• Setting optimal ratio and limit of each component
of the balance sheet.
• Running stress tests.
• Maintaining sound liquidity.
• Checking policy compliance regularly.
• Taking measures to better manage risks
threatening the Bank and to maximize profit.
To deal with risks associated with policy changes,
Techcombank focuses on:
• Building up criteria for strengthening relationship
with partners; improving analysis of competitors.
• Regularly updating models to determine limits
for customers which help improve accuracy and
efficiency.
• Building models to set the total limit and assign
the sub-limit to each field: money market, foreign
exchange, fixed income, L/Cs, and commodities.
• Building up various scoring criteria to cover the
overall business operation and potential risks of
counterparties.
• Diversifying sources of information used and
approaches to counterparty.
• Rating institutions which are the Bank’s partners;
gathering, recording and reporting on rating
results.
We attach great importance to gathering and
analysing information, news, market data, and
forecasts which help us to formulate our own ideas
on market fluctuations in the short, medium and
36 - Annual Report 2008
long terms; thus sending warning messages over
Risks associated with procedures, products:
potential risks to concerned parties; proposing
measures to minimize risks and optimize our
• Evaluating risks, checking procedures, products.
returns. The Bank has already set up specialized
• Building KRIs in each function of operation to
units to gather such information and develop
control risk.
models to analyze impacts of political and economic
• Training and supporting business units to produce
events on business performance. their own evaluation of operational risk.
• Building a network of coordinators at every
Operational Risk business function to gather information on loss
and then evaluate risks.
Operational risk is the risk of losses caused through • Training to upgrade skill levels and raise
inadequate or defective systems and processes, awareness of over operational risks to protect the
human or technical failures, or external events Bank from operational risk.
such as system breakdown or fire damage.
We have spent considerable time and resources on
Operational risk is a conventional risk in the building Business Continuity Plan (BCP) for the Bank
banking business. However, measures to control as a whole as well as for separate business units
it are reasonably new, even to some major banks. in case of natural disasters. This important initiative
Many Vietnamese banks have recently incurred included training staff and staging rehearsals to
considerable losses created by operational risks. raise awareness of protective measures in the event
of such disasters occurring.
At Techcombank, all business lines / functions must
control operational risk in their own operations. In
addition, a specially designated department in the
Market and Operational Risk Management Division
performs deep dives on:
Risks associated with technology:
• Controlling IT systems (IT, card systems),
ensuring their readiness.
• Building and applying evaluation on technology-
associated risks.
• Monitoring IT projects.
• Appraising and involving in implementation of
IT projects.
• Delivering warning messages on IT investments.
• Training staff on information security.
Annual Report 2008 - 37
Technology

Supporting Liquidity and Payment System Supporting Risk Management

After the successful roll-out of internet banking
services for individuals (F@st I-Bank) in 2007,
Techcombank introduced a similar service for SMEs
called F@st E-Bank last year. It is the sole full-service
internet banking offered by a Vietnamese bank to
clients, which includes account inquiries, and fund
transfer to other accounts with Techcombank or
with other banks using double passwords and one-
time password. The F@st MobiPay is a useful tool
which allows customers to make account inquiries or
payment within Techcombank via mobile phones. In
2008, this service was upgraded using OTAC (One
Time Authentication Certification) and OTP (One
Time PIN), which requires customers to use a new
PIN for a certain period of time.
In 2008, Techcombank ran some systems to increase
productivity and minimize operational risk. It applied
Processing Workflow (PW) in Personal Financial
Services to centralize individual customer scoring
and credit approval at the Retail Credit Center. The
Bank also applied the new IT system dealing with
organizational restructure towards centralization such
as Payment Center, and Credit Approval Center. The
Bank focused on rolling out the Enterprise Content
Management (ECM-Filenet) applicable to the main
procedures throughout centers, branches and sub-
branches, enhancing MIS, and piloting Business
Intelligence and Data Warehouse, which upgrades
management information requirements and thus
facilitates the decision-making process.

In the first half of 2008, Vietnam’s banking system

One of Techcombank’s strengths is technology.
Substantial investments were made in technology
to enable the Bank to implement best practices
and deliver to a growing customer base modern
products and services, thereby fostering profitable
overall growth.
In 2008, the Bank focused on strengthening its IT
system, currently organized to serve three main
requirements: developing the corebanking system,
developing business support and control systems,
and supporting risk management. The target is to
make the IT Center a professional unit which applies
advanced management models up to international
standards and is totally oriented to serving customers.
Developing Corebanking System
The Bank’s corebanking system is continuously
upgraded to match world banking standards and to
ensure that the overall system always operates online
on a real-time basis, with data synchronization at
any transaction office of the Bank. The core banking
system (developed by Temenos Holdings) was first
applied in 2002 and upgraded annually. Techcombank
is using the latest version of T24R07 (2008).
In 2008, based on the core banking system, the Bank
successfully deployed the multi-book system which
enables network expansion faster and more easily,
serving the retail banking strategies, while meeting the
reporting requirements of every single business unit.
This corebanking system also enables Techcombank
to expand connectivity to other management support
programs such as the payment system, credit
management system and the risk management
supporting programs.
Developing Business Support and
Control System
The advanced corebanking system, allows the
integration of subsidiary systems such as the payment and
liquidity system, the card and ATM processing system,
and the operational support system are integrated.
faced liquidity problems and higher interest rates with
every bank implementing aggressive deposit policies
as well as flexible deposit rates to maintain stable
funding. Thanks to some of the special functions of
the core banking system, F@st-Invest is a special
deposit product for business clients. This deposit
product shows how interest rates vary with changes
in the account’s outstanding balance.
Supporting Card Payment and ATM System
In 2008, the Bank successfully connected to the Visa
credit card system; to the card payment system of
HSBC Vietnam, Banknet, and Paynet; ran co-brand
cards with Vietnam Airlines; ran ADM; and applied
Fraud Analyzer dealing with fake card transactions.
These supporting functions helped Techcombank
become the Bank of Best Card Payment system and
Best Visa issuer in Vietnam.

38 - Annual Report 2008 Annual Report 2008 - 39

Human Resources

Breakdown of staff Treasuring Talents

15%
Talents are considered to be a treasure of the nation
in general and of the banking industry in particular.
3%
Thus, Techcombank attaches great importance
to offering preferential treatment to staff with the
viewpoint of minimizing personal worries so that they
can concentrate on improving the quality and efficiency
in their work.
82%
In 2008, Techcombank sought advice from William
Mercer, whose representative in Vietnam is Talent
Net, to adjust salary scales, raising salary in the whole
system in July 2008 and continuing to improve it in 2009.
This has made an important contribution to enhancing
University graduates & the Bank’s human resource competitiveness, attracting
postgraduates
many highly skilled and competent staff. The total
College and short-term payroll increased 122.5% to VND405 billion in 2008.
training graduates The per capita average income reached VND8 million
High school graduates per month, up 54.5% against 2007. The total bonus
for the most outstanding staff was VND20 billion,
accounting for 5% of the total payroll in 2008.

Human resources are the firm foundation for every
enterprise to develop rapidly and in a sustainable
manner. For Techcombank, every staff member
is seen not only as an asset but also as the most
precious source of capital because they are the ones
who implement business strategies and maintain
the relationship with customers, ensuring the Bank’s
success in recent years as well as in the future.
The Bank, during 15 years of operation, has always
attached great importance to developing high-quality
human resources, and creating a professional working
environment with equitable policies to encourage the
staff to be more enterprising, to the benefit of both
customers and the Bank. Techcombank has also paid
special attention to offering preferential treatment,
both in the material and spiritual forms, to staff,
including due attention to their families. Techcombank
was able to attract and retain quality staff in a highly
competitive market for human resources and even
though Techcombank remuneration levels were not
the highest among banks, our staff have still worked
wholeheartedly for the development of the Bank.
In addition to trademarks of banking services and
products, Techcombank has created a trademark
of human resources, the trademark of a working
environment where staff have strong attachment to,
and receive encouragement and support to enrich their
knowledge, enhance capability, and contribute to the
success of the Bank.
Recruiting and Treating Talents
In 2008, when many domestic and foreign banks had to
trim their workforce due to the impact of the economic
recession, Techcombank emerged as a bright point for
creating jobs and attracting talent. As of late 2008, the
staff number increased 44.21% against the previous
year (from 2,929 to 4,224), in which the number of
managerial posts rose 36.86%, and staff having at least
two years of experience rose 58.45%. The percentage
of staff having graduate and post-graduate degrees
increased from 78% to 82%.
Taking the developing Vietnamese banking industry
into consideration, Techcombank pays special attention
to recruiting talented people who are well-trained
and hold middle or high-ranking managerial posts in
international institutions, as well as assigning the right
work and positions to the right people. Therefore, most
of the staff are really energetic and enterprising. Staff
often put forth effective customer development and
business solutions.
In the same year, Techcombank implemented the Share
Bonus Program for employees who have contributed
to the Bank’s development to encourage their loyalty.
We have paid attention to not only financial factors,
but also to the healthcare of our staff and their family
members, so that they keep their mind on their work.
In addition to ordinary health insurance, the Bank has
offered accident insurance and Techcombank Care
health insurance provided by Bao Minh Insurance Co.
Ltd. to all staff and family members of medium and
high-ranking managers since January 2008, following
recommendations from AON Consulting Company.
The total expense for this program is VND4.5 billion. In
early 2009, this insurance program was expanded to
lower ranking managers so that their family members
can benefit from lower cost, and higher claim amounts
from many prestigious healthcare establishments.
Techcombank is the first bank to offer this policy to
all employees and their family members, easing their
worries about accidents or illnesses, and setting their
mind at rest when using best healthcare services.

40 - Annual Report 2008 Annual Report 2008 - 41

Human Resources (Continued)
This is one of principal factors of the overall personnel
and welfare policy adopted by the Bank.
The series of social and cultural activities held
on festive days, including the Bank’s founding
anniversary (Techcombank’s Day), summer and
winter vacations (Techcombank Summer/Winter
Holiday), and Christmas, have reinforced bonds and
solidarity among all members of the great family of
Techcombank.
Building a Secured Future
Along with recruiting experienced, well-trained,
proactive and creative employees, Techcombank
focuses on training promising employees for a secure
future. The Bank has set a prime target of fostering
human resources in a sustainable manner, turning
out highly skilled and professional staff to offer better
services to customers.
42 - Annual Report 2008
Techcombank has actively organized in-house
training courses designed for new employees to
enrich their knowledge and skills to better understand
market demands and development trends to launch
new products and services. We have also coordinated
closely with third-party organizations to provide training
for employees, and send them to good international
and domestic courses in different areas such as
Quality Management and Strategy Management.
Notably, in early 2008, Techcombank signed training
contracts with famous universities in Hanoi and Ho
Chi Minh City, and requested some training centers
to develop appropriate training programs, most of
which are designated for candidates for managerial
positions in the near future.
The total number of training courses increased
46.39% (from 291 to 426) in late 2008, and that of
staff undergoing the courses surged 58.22% (from
7,351 to 11,631). The training costs rose 59% to
VND6.74 billion.
Corporate and Social Responsibilities
Through 15 years of development, Techcombank
has always determined that profit is not the only
target to be realized at any cost, and that resources
should be earmarked for the development of “for
the community” trademark, contributing to society’s
sustainable development. We firmly believe that a
business is successful only when our interests are in
harmony with those of the society and the community.
Business for a Better Community
In its daily business, the Bank commits not to let
business and trading pressure affect good regulations,
standards and practices that have been chosen to
be the foundation of our corporate culture. Thus,
Techcombank does not cooperate with individual
and corporate customers as well as partners whose
activities adversely affect the natural or social
environment. In addition, the Bank takes the lead
in disbursing capital for projects funded by foreign
governments and NGOs which are designated for
poverty eradication and generally improving life of
poor people, supporting private enterprises in rural
areas, and small and medium-sized enterprises to
expand production, and promoting clean and energy-
saving technologies.
We are currently taking part in the following projects:
1. The SME Development Fund (SMEDF) project
sponsored by the European Commission that
supports SMEs to develop production and
business.
2. The Rural Development Financing project phase
2 (RDF2) sponsored by the World Bank for
individuals and private enterprises in rural areas.
3. The SME Finance Project phase 2 (SMEFP2)
sponsored by the Japan Bank for International
Cooperation (JBIC) through the State Bank of
Vietnam (SBV).
4. The Housing Financing Facility (HFF) sponsored
by the Asian Development Bank for low-income
and poor households in cities to improve living
conditions.
Annual Report 2008 - 43
Corporate and Social Responsibilities
(Continued)
5. The Commercial Energy Efficiency Program
(CEEP) sponsored by the World Bank to help
SMEs purchase or upgrade equipment in order
to save energy and costs.
6. The Promotion of Energy Conservation in SMEs
(PECSME) sponsored by the Global Environment
Facility of the World Bank to provide guarantees
for SMEs operating in specific fields to invest in
clean and energy-saving production technologies.
7. The Green Credit Trust Fund established on
the initiative of the Swiss State Secretariat for
Economic Affairs (SECO) to provide financial
assistance and credit guarantees for SMEs
to replace old technologies with modern and
environmentally-friendly ones.
8. The project to cooperate and financially assist
food processing and packaging enterprises which
participate in the Hanoi Business Incubation
(HBI) program.
Social and Charitable Activities
In 2008, the Bank continued to sponsor a large
number of social and charitable activities to the tune
of VND9.6 billion. Some of these events are:
1. “Hanoi Tet: Past and Present” program of
Hanoi Television magazine
On the occasion of 2008 Lunar New Year
Festival, Techcombank and Hanoi Television
magazine co-organized a special television show
named “Hanoi Tet: Past and Present”. The show,
which exhibited and promoted traditional cultural
features, especially those of Hanoians in the
past and the present, left strong impressions on
viewers throughout the country.
44 - Annual Report 2008
2. Traditional 30/4 Olympic contest in the
Southern region
Techcombank took part in sponsoring the
traditional 30/4 Olympic contest in the Southern
region from April 3-5, 2008 at Le Hong Phong
High School. This activity was aimed at promoting
young talents of Vietnam.
3. Children’s Day - June 1
On the occasion of Children’s Day on June
1, 2008, Techcombank and the Social Work
Center under the Ho Chi Minh Communist Youth
League of Ho Chi Minh City co-organized a social
program entitled “For Suburban Friends” for over
200 disadvantaged children in Hiep Phu Ward,
District 9, Ho Chi Minh City.
4. Cua Lo Beach Cleansing Campaign
In July 2008, all staff of Techcombank participated
in a campaign to cleanse Cua Lo Beach.
5. Sao Mai Diem Hen
Techcombank coordinated with Vietnam
Television to organize “2008 Sao Mai Diem Hen”
(Morning Star Rendezvous) music contest to
bring into play young talents in Vietnam, and offer
viewers special entertainment.
6. War Invalids and Martyrs’ Day - July 27
On the occasion of the Vietnamese War Invalids
and Martyrs’ Day on July 27, 2008, Techcombank
co-ordinated with Vietnam Television and
contestants of “2008 Sao Mai Diem Hen” music
contest to visit heroic mother Pham Thi Co in Kim
Lu village, Thanh Nguyen commune, Thanh Liem
district, Ha Nam province. Techcombank offered
her VND10 million.
7. 2008 Terry Fox Run
A large number of Techcombank employees
participated in the 9th Terry Fox Run program to
support research programs for cancer treatment in
Vietnam in particular and in the world in general.
8. Charity activities to help storm victims
On August 16, 2008, Techcombank donated
VND50 million to the Golden Heart Fund of Vietnam
Television in order to help people affected by
Kammuri, the fourth storm striking Vietnam in the
year. Besides, over 3,700 Techcombank employees
donated cash, clothes and other goods to people in
the affected provinces.
9. Awarding scholarships to poor pupils in
Can Tho City
At the ceremony of new school year, Techcombank
Can Tho gave 25 scholarships totaling VND25
million to studious poor pupils of 5 junior high
schools and primary schools in inner Can Tho City.
The schools include Luong The Vinh, Mac Dinh Chi,
Thoi Binh 1, An Hoa 2, and Tran Quoc Toan.
10. Mid-Autumn Festival for sightless pupils of
Nguyen Dinh Chieu School
The Bank organized a party and cultural activities,
and gave presents to visually impaired pupils of
Nguyen Dinh Chieu School in Hanoi at the Mid-
Autumn Festival, in a move to encourage them to
live and study well.
Annual Report 2008 - 45
 AWARDS AND SOCIAL RECOGNITION
testament of our commitment
Certificate of Merit granted by the Prime Minister
for greatly contributing to restraining inflation,
stabilizing macro-economy, meeting the capital
need for production expansion and export, and
maintaining social security.
“Top Trade Services” Prize in 2008 granted by
the Ministry of Industry and Trade.
“Unique Big Enterprise With Effective IT
Application” Award granted by the Ministry of
Information and Communications in 2008.
46 - Annual Report 2008
Golden Cup for “Social Improvement and
Sustainable Development” granted by the
Ministry of Labor, Invalids and Social Affairs.
“Prestigious Securities” Award and “Top Joint
Stock Company in 2008” Award granted by
the State Securities Commission and the
Securities magazine.
“Most Active Issuing Bank in East Asia in
2008” Award granted by the IFC.
“Golden Star of Vietnam” Award granted by
the Young Enterprises Association in 2006
and 2008.
“Most Favored Services Company in 2008”
Award granted by consumers under a
voting program held by Saigon Marketing
newspaper.
“Strong Trademark of Vietnam” Award
granted by Vietnam Economic Times in
2006, 2007, 2008.
Annual Report 2008 - 47
 We measure our success by our
customer’s success

“Techcombank’s business orientations

are always based on our customers’
benefits as our customers are the focus
of every activity in our business.”

48 - Annual Report 2008 Annual Report 2008 - 49

 FINANCIAL TARGETS FOR 2009 AUDITED FINANCIAL STATEMENTS 2008

Audited Financial Statements for Bank 2008

Financial targets for 2009 Bln VND, %
a. Total assets: 82,041
“In our opinion, the separate financial statements present fairly,
b. Total customer deposits 72,077 in all material respects, the unconsolidated financial position
of the Bank as of 31 December 2008 and the unconsolidated
c. Total loans and advances 33,112 results of its operations and its cash flows for the year then
ended, in accordance with Vietnamese Accounting Standards,
d. Non-performing loans ≤2.5% the Vietnamese Accounting System for Credit Institutions and
other relevant accounting regulations stipulated by the State
e. Profit before tax 2,000
Bank of Vietnam and accounting principles generally accepted
f. Dividends 20% in Vietnam”

g. ROE 19%

h. ROA 1.65%

50 - Annual Report 2008 Annual Report 2008 - 51

Corporate information KPMG Limited
10th Floor, Sun Wah Tower
Telephone +84 (8) 3821 9266
Fax +84 (8) 3821 9267
115 Nguyen Hue Street Internet www.kpmg.com
District 1, Ho Chi Minh City
The Socialist Republic of Vietnam

REPORT OF THE INDEPENDENT AUDITORS

Banking Licence No.
0040/NH - GP 6 August 1993
The banking licence was issued by the State Bank of Vietnam and was
valid for 20 years from the date of the banking licence. The operation period
was extended to 99 years under Decision No. 330/QD-NH5 of the State
Bank of Vietnam dated 8 October 1997.
Board of Management
Mr. Ho Hung Anh Chairman
Mr. Nguyen Dang Quang First Vice Chairman
Mr. Nguyen Thieu Quang Vice Chairman
Mr. Tran Duc Luu Vice Chairman
Mr. Ngo Chi Dung Vice Chairman
Mr. Brian Fredrick Member (until 8/12/2008)
Mr. Nguyen Canh Son Member
Mr. Le Huu Bau Member
Mr. Hoang Van Dao Member
To the Shareholders
Vietnam Technological Commercial Joint Stock Bank
(Incorporated in the Socialist Republic of Vietnam)
Scope
We have audited the accompanying separate balance sheet of Vietnam Technological Commercial
Joint Stock Bank (“the Bank”) as of 31 December 2008 and the related separate statements of
income, changes in equity and cash flows for the year then ended. These financial statements are
the responsibility of the Bank’s management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with Vietnamese Standards on Auditing. Those standards
require that we plan and perform the audit to obtain reasonable assurance that the financial
statements are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.
Audit opinion

Board of Directors In our opinion, the separate financial statements present fairly, in all material respects, the
Mr. Nguyen Duc Vinh Chief Executive Officer unconsolidated financial position of the Bank as of 31 December 2008 and the unconsolidated
Ms. Nguyen Thi Tam Deputy General Director results of its operations and its cash flows for the year then ended, in accordance with Vietnamese
Mr. Pham Quang Thang Deputy General Director Accounting Standards, the Vietnamese Accounting System for Credit Institutions and other
Ms. Luu Thi Anh Xuan Deputy General Director relevant accounting regulations stipulated by the State Bank of Vietnam and accounting principles
Mr. Nguyen Duy Phu Deputy General Director generally accepted in Vietnam.
Mr. Le Xuan Vu Deputy General Director
Mr. Nguyen Thanh Long Deputy General Director
Ms. Do Diem Hong Deputy General Director (from 1/6/2008)
Mr. Tran Hoai Phuong Deputy General Director (from 1/9/2008)
Ms. Nguyen Thi Thien Huong Deputy General Director (from 1/10/2008)

KPMG Limited
Head Office 70-72 Ba Trieu Street Vietnam
Hoan Kiem District Investment Certificate No: 011043000345
Hanoi, Vietnam Audit Report No: 08-02-146/2

Auditors KPMG Limited

Vietnam
John T. Ditty Vo Thanh Phu Quoc
CPA No. N 0555/KTV CPA No.0339/KTV
General Director

Hanoi, 12 March 2009

© 2009 KPMG Limited, a Vietnamese limited liability company and a
member firm of the KPMG net work of independent member firms affiliated
with KPMG International, a Swiss cooperative. All rights reserved

52 - Annual Report 2008 Annual Report 2008 - 53

Balance sheet Balance sheet
as at 31 December 2008 as at 31 December 2008 (continued)

2008 2007 2008 2007

VND million VND million VND million VND million

Assets Equity
Cash on hand and gold 1,565,938 496,173 Share capital 3,642,015 2,521,308
Balances with the State Bank of Vietnam 2,296,574 1,298,682 Share premium 1,063,402 476,779
Balances with financial institutions 15,525,959 9,303,685 Other capital 371 371
Investments in securities 10,500,988 6,842,172 Retained earnings 628,354 428,636
Loans and advances to customers 26,018,985 19,841,131 Reserves 281,412 146,322
Advances to purchase securities 921,250 645,000 5,615,554 3,573,416
Long-term investments in equities 475,765 36,930 59,360,485 39,542,496
Fixed assets 574,479 436,970
Other assets 1,480,547 641,753 Off-balance sheet items
59,360,485 39,542,496 Letters of credit 2,879,247 5,455,192
Undrawn loan commitments 14,031 -
Liabilities Guarantees 2,283,271 1,348,279
Borrowings from the State Bank of Vietnam - 301,993 Foreign exchange contracts 3,184,902 375,323
Balances and borrowings from financial Gold contracts 122,697 -
institutions 8,970,269 8,458,903
Future commodity purchase commitments 1,395,433 6,051,861
Valuable papers 2,761,793 1,750,715
Future commodity sales commitments 1,414,321 5,881,154
Entrusted funds 231,961 161,170
Deposits from customers 39,930,678 24,476,576
General provision for commitments 34,203 25,216
Other liabilities 1,399,925 638,183 Approved by:
Provision for taxation 416,102 156,324
53,744,931 35,969,080

Nguyen Duc Vinh Tran Van Chien

Chief Executive Officer Chief Accountant

54 - Annual Report 2008 Annual Report 2008 - 55

Statement of income
for the year ended 31 December 2008

(30,594)

(41,242)
(364,201)
1,761,687
1,331,939
-
-
510,384
-

3,573,416

1,272,357
-
-

1,995
1,173,229
-

5,615,554
Total
2008 2007

(12,840)

(30,594)

(434,973)

(41,242)
86,253
-
-

-
103,503

146,322

-
1,995
609,310

281,412
VND million VND million

Reserves
Interest and similar income 6,213,718 2,326,002
Interest and similar expenses (4,469,416) (1,400,728)
Net interest income 1,744,302 925,274

Chief Accountant
Tran Van Chien
(149,366)

(103,503)

(609,310)

(364,201)
171,121
-

-
510,384

-
428,636

-
-
-

-
1,173,229

628,354
Fee and commission income 543,270 206,958

Retained
earnings
Fee and commission expenses (60,393) (30,022)
Net fee and commission income 482,877 176,936

Foreign exchange gain – net 21,793 24,583

Dividend income 78,864 2,992

371
-
-
-
-
-
-
371

-
-
-

-
-
-
-
-
371
Other capital
Income from securities trading – net 931,102 81,761
Other income 9,355 4,462
Salaries and related expenses (405,506) (182,240)

Approved by:
Specific allowance for doubtful debts (537,171) (10,818)
General allowance for doubtful debts (71,774) (48,297)

(476,779)
3,942
472,837
-
-
-
-
-
476,779

1,063,402
-

-
-
-
-

1,063,402
Reversal of specific allowance for doubtful debts 6,225 -

premium
Share
General provision for commitments (8,987) (19,937)
Allowance for diminution of investments in securities (148,318) -
Allowance for diminution of investments in equities (5,740) (1,835)

Statement of changes in equity

Reversal of allowance for diminution of investments
in equities 1,835 -

1,500,000
859,102
149,366
12,840
-
-
-
2,521,308

208,955
434,973
476,779

-
-
-
-
-
3,642,015
for the year ended 31 December 2008
Depreciation and amortisation of fixed assets (42,189) (23,535)

Chief Executive Officer

capital
Share

Nguyen Duc Vinh

General administration expenses (456,320) (219,606)
Profit before taxation 1,600,348 709,740

Corporate income tax (427,119) (199,356)

Transfer from reserves to share capital

Transfer from reserves to share capital

Transfer from share premium to share
Profit after taxation 1,173,229 510,384

Balance at 31 December 2008

Earnings per share (par value of VND10,000/share)

(VND million)

Balance at 1 January 2007

Balance at 1 January 2008

Basic earnings per share (VND) 4,224 3,235

Utilisation of reserves

Utilisation of reserves
Net profit for the year

Net profit for the year

Transfer to reserves

Transfer to reserves

Capital contribution

Capital contribution

Other movements
Share dividends
Approved by:

Dividends
capital
Nguyen Duc Vinh Tran Van Chien
Chief Executive Officer Chief Accountant

56 - Annual Report 2008 Annual Report 2008 - 57

Statement of cash flows Statement of cash flows
for the year ended 31 December 2008 for the year ended 31 December 2008 (continued)

2008 2007 2008 2007

VND million VND million VND million VND million

Cash flows from operating activities Cash flows from investing activities
Profit before tax 1,600,348 709,740
Purchase of fixed assets and construction in progress (180,919) (122,662)
Adjustments for:
Increases in investments in subsidiaries (410,000) -
Depreciation and amortisation of fixed assets 42,189 23,535
Dividends received during the year 78,864 2,992
General allowance for commitments issued 8,987 19,937
Specific allowance for doubtful debts – net 530,946 10,818 Paid for investments in securities (10,271,303) (6,050,932)

General allowance for doubtful debts 71,774 48,297 Proceeds from disposal of investments in securities 5,937,719 1,872,325
Allowance for diminution of investment in securities 148,318 - Redemptions of investment in securities 1,457,552 295,000
Allowance for diminution of investment in equities – net 5,740 1,835 Acquisition of investment in equity (34,575) (7,982)
Income from investment in securities (931,102) (81,761) Net cash outflow from investing activities (3,422,662) (4,011,259)
Dividend income received (78,864) (2,992)
Loss on disposal of fixed assets 1,221 458 Net cash flows from financing activities
Operating profit before changes in operating assets Issuance of share capital and share premium 1,272,357 1,331,939
and liabilities 1,399,557 729,867
Distributions to shareholders (364,201) (57)
(Increase)/decrease in operating assets
Balances with other financial institutions (2,622,031) (2,890,053) Net cash inflow from financing activities 908,156 1,331,882

Loans and advances to customers (6,780,574) (11,204,145)

Advances to securities companies to purchase securities (276,250) (645,000) Net increase in cash and cash equivalents 5,667,900 3,136,957
Other assets (838,794) (328,918) Cash and cash equivalents at the beginning of the year 5,775,858 2,638,901
Increase/(decrease) in operating liabilities Cash and cash equivalents at the end of the year 11,443,758 5,775,858
Borrowings from the State Bank of Vietnam (301,993) 244,110
Balances and borrowings from other financial institutions 511,366 3,388,051
Entrusted funds 70,791 (116,137) Non-Cash Investing Activities
Deposits from customers 15,454,102 14,910,533
Valuable papers issued 1,011,078 1,558,473 2008 2007
Other liabilities 767,732 274,844 VND million VND million
Cash inflow from operating activities 8,394,984 5,921,625 Dividends received in shares 75,743 -
Corporate income tax paid (173,331) (74,697)
Utilization of reserves (41,242) (30,594) Approved by:
Other movements 1,995 -
Net cash inflow from operating activities 8,182,406 5,816,334

Nguyen Duc Vinh Tran Van Chien

Chief Executive Officer Chief Accountant

58 - Annual Report 2008 Annual Report 2008 - 59

Notes to the financial statements Notes to the financial statements
for the year ended 31 December 2008 for the year ended 31 December 2008 (continued)

These notes form an integral part of, and should be read in conjunction with, the accompanying
financial statements.
1. Reporting entity
The principal activities of Vietnam Technological and Commercial Joint Stock Bank (“the Bank”),
which is incorporated as a joint stock bank in the Socialist Republic of Vietnam, are to carry
out banking activities, under Banking Licence No. 0040/NH-GP issued by the State Bank of
Vietnam (“SBV”) on 6 August 1993 for an initial period of 20 years. The operation of the Bank
was extended to 99 years under Decision No. 330/QD-NH5, dated 8 October 1997, of the SBV.
The Bank’s Head Office is located at 70 - 72 Ba Trieu, Hanoi. As at 31 December 2008, the Bank
has one Head Office, 01 representative office, 01 Head Office transaction centres, 38 branches
and 114 transaction offices nationwide.
As at 31 December 2008, the Bank has three subsidiaries as follows:
The financial statements, expressed in Vietnam Dong (“VND”), rounded to the nearest million, have
been prepared in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting
System for Credit Institutions and other relevant accounting regulations stipulated by the State
Bank of Vietnam, and accounting principles generally accepted in Vietnam. These accounting
policies may differ in some material respects from International Financial Reporting Standards
and the generally accepted accounting principles and standards of other countries. Accordingly,
the accompanying financial statements are not intended to present the financial position and
results of operations and cash flows in accordance with generally accepted accounting principles
and practices in countries or jurisdictions other than Vietnam. Furthermore, their utilisation is
not designed for those who are not informed about Vietnam’s accounting principles, procedures
and practices.
The financial statements, except for the statement of cash flows, are prepared on the historical
cost basis. The statement of cash flows is prepared using the indirect method. The accounting
policies have been consistently applied by the Bank and are consistent with those used in the
previous year.

% owned by (b) Fiscal year

Subsidiary Operating licence Nature of Business
the Bank
Techcom Securities 98/UBCK-GP, dated 18 Securities activities 100% The fiscal year of the Bank is from 1 January to 31 December.
Company Limited September 2008 granted by
State Securities Committee.
(c) Foreign currency transactions
Vietnam Technological 0104003519 dated 18 June Asset management 100%
and Commercial Joint 2008 granted by Hanoi
Stock Bank - Asset Planning and Investment Monetary assets and liabilities denominated in currencies other than VND are translated into
Management Company Department. VND at rates of exchange ruling at the balance sheet date. Transactions in currencies other
Limited than VND during the year have been translated into VND at rates approximating those ruling on
transaction dates. All realised and unrealised foreign exchange differences are recorded in the
Techcom Capital 40/UBCK-GP, dated 21 Fund management 100% statement of income.
Management Company October 2008 granted by
Limited State Securities Committee.
Open commitments on forward foreign exchange contracts are revalued at rates of exchange
ruling at the balance sheet date. Any gain or loss arising therefrom is included in the statement
As at 31 December 2008, the Bank had 4,224 employees (31 December 2007: 2,929 employees). of income.

2. Summary of significant accounting policies

(d) Cash and cash equivalents
The following significant accounting policies have been adopted by the Bank in the preparation
of these financial statements. Cash and cash equivalents include cash on hand, balances with the SBV and balances with other
banks with original terms to maturity not exceeding three months.

(a) Basis of financial statement preparation

(e) Investments in securities
These are the separate financial statements of the Bank which do not include financial statements
of subsidiaries. The Bank produces consolidated financial statements which included the Bank Investments in securities comprise securities issued by the Government, the SBV and other
and its subsidiaries and issues them separately, in addition to these financial statements. banks and companies. Those that the Bank holds for the purpose of short-term profit taking are
classified as trading instruments. Those that the Bank has the intention and ability to hold to

60 - Annual Report 2008 Annual Report 2008 - 61

Notes to the financial statements
for the year ended 31 December 2008
maturity are classified as held-to-maturity assets. Other investments are classified as available-
for-sale assets.
Investments in securities are stated at cost less allowance for diminution in value of investments.
(f) Long-term investments in equities
Investments in subsidiaries are stated at their cost in the separate financial statements.
Other long-term investments in equities are stated at cost less allowance for diminution in value of
the investments. Management determines the diminution allowance after giving consideration to
cost, market conditions, current and projected operating performance and expected cash flows.
(g) Loans and advances to customers
Decision No. 493/2005/QD-NHNN dated 22 April 2005 issued by State Bank of Vietnam, which
was amended and supplemented by Decision No. 18/2007/ QD-NHNN dated 25 April 2007 issued
by State Bank of Vietnam, requires specific allowance to be made for loans and advances on a
monthly basis based on loan gradings.
The specific allowance disclosed at the balance sheet date (i.e. 31 December) is determined
utilising the following allowance rates against principal outstanding as at 30 November less
allowed value of collateral.
Allowance
Group Overdue status
1 Current Current loans or overdue loans less than 10 days.
2 Special • Loans being overdue between 10 days to 90 days; or
mentioned • Loans having revised terms of repayments for the first time (if
customers are assessed as being capable of repaying both principal
and interest according to the first revised terms of repayments for the
case of enterprises and organisational customers).
3 Sub- • Loans being overdue between 91 days and 180 days;
standard • Loans having rescheduled terms of repayments for the first time
except for the loans with revised terms of repayments classified into
the above mentioned Group 2; or
• Loans having exempt or reduced interest because customers are not
able to pay the interest according to contracts.
62 - Annual Report 2008
Notes to the financial statements
for the year ended 31 December 2008 (continued)
Allowance
Group Overdue status
rate
4 Doubtful • Loans being overdue between 181 days and 360 days; 50%
• Loans having rescheduled terms of repayments for the first time and
being overdue less than 90 days according to the first rescheduled
terms of repayments; or
• Loans having rescheduled terms of repayments for the second time.
5 Loss • Loans being overdue more than 360 days; 100%
• Loans having rescheduled terms of repayments for the first time
and being overdue from 90 days or more according to the first
rescheduled terms of repayments;
• Loans having rescheduled terms of repayments for the second time
and being overdue according to the second reschedule terms of
repayments;
• Loans having rescheduled terms of repayments for the third time; or
• Blocked loans, or loans awaiting for settlements.
In addition, the Bank is required to make a general allowance of 0.75% of total outstanding
loans that are classified from Group 1 to Group 4 as at the balance sheet date. Such general
allowance is required to be made in full within 5 years from the effective date of Decision No.
493/2005/QD-NHNN. As at the balance sheet date, the bank provided a general allowance of
0.6% of the above balances as at 30 November 2008 (2007: 0.45%).
In accordance with the requirements of this Decision, loans and advances are written off against
allowance when loans and advances have been classified to Group 5 or when borrowers have
rate declared bankruptcy or dissolved (for borrowers being organisations, enterprises) or borrowers
have been dead or missing (for borrowers being individuals).
0%
No general allowances are made for country risk, other than the financial reserve required by the
5% State Bank regulations (Note 17).
(h) Provision for off-balance sheet commitments
20% In accordance with Decision No. 18/2007/QD-NHNN, the Group is also required to classify
guarantees, acceptances, irrevocable undrawn loan commitments which are irrevocable into
relevant groups and make specific allowances accordingly.
Annual Report 2008 - 63
Notes to the financial statements
for the year ended 31 December 2008 (continued)
In addition, in accordance with Decision 493/2005/QD-NHNN the Group is required to make
a general provision of 0.75% of total outstanding letters of guarantee, letters of credit, and
irrevocable undrawn loan commitments as at the balance sheet date. Such general provision
is required to be made in full within 5 years from the effective date of the Decision. As at the
balance sheet date, the Bank provided a general provision of 0.6% of the above balances as at
30 November 2008 (2007: 0.45%).
(i) Tangible fixed assets
(i) Cost
Tangible fixed assets are stated at cost less accumulated depreciation. The initial cost of a
tangible fixed asset comprises its purchase price, including import duties and non-refundable
purchase taxes and any directly attributable costs of bringing the asset to its working condition
and location for its intended use. Expenditure incurred after the tangible fixed assets have been
put into operation, such as repairs and maintenance and overhaul costs, is normally charged
to statement of income in the year in which the costs are incurred. In situations where it can be
clearly demonstrated that the expenditure has resulted in an increase in the future economic
benefits expected to be obtained from the use of an item of tangible fixed assets beyond its
originally assessed standard of performance, the expenditure is capitalised as an additional cost
of tangible fixed assets.
(ii) Depreciation
Depreciation is computed on a straight-line basis over the estimated useful lives of items of
tangible fixed assets. The estimated useful lives are as follows:
• buildings and building improvements 20 - 50 years
• office equipment 4 - 8 years
• motor vehicles 7 years
• others 4 - 5 years
(j) Intangible fixed assets
(i) Land use rights
Land use rights include costs incurred to acquire formal rights to use land. The initial cost is
based on the costs incurred and the value of land approved by the Government at the time of
acquisition. Land use rights included those with definite term and those with indefinite term.
Land use rights with definite term are amortised over their useful lives. Land use rights with
indefinite term are not amortised.
64 - Annual Report 2008
Notes to the financial statements
for the year ended 31 December 2008 (continued)
(ii) Software
Cost of acquisition of new software, which is not an integral part of the related hardware, is
capitalised and treated as an intangible asset. Software is amortised on a straight-line basis over
4 years.
(k) Provision
A provision is recognised if, as a result of a past event, the Bank has a present legal or constructive
obligation that can be estimated reliably, and it is probable that an outflow of economic benefits
will be required to settle the obligation. Provisions are determined by discounting the expected
future cash flows at a pre-tax rate that reflects current market assessments of the time value of
money and the risks specific to the liability.
(l) Taxation
Income tax on the profit or loss for the year comprises current and deferred tax. Income tax is
recognised in the statement of income except to the extent that it relates to items recognised
directly to equity, in which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates
enacted or substantially enacted at the balance sheet date, and any adjustment to tax payable
in respect of previous years.
Deferred tax is provided using the balance sheet liability method, providing for temporary
differences between the carrying amounts of assets and liabilities for financial reporting purposes
and the amounts used for taxation purposes. The amount of deferred tax provided is based on
the expected manner of realisation or settlement of the carrying amount of assets and liabilities
using tax rates enacted or substantively enacted at the balance sheet date.
A deferred tax asset is recognised only to the extent that it is probable that future taxable profits
will be available against which the asset can be utilised. Deferred tax assets are reduced to the
extent that it is no longer probable that the related tax benefit will be realised.
(m) Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of
ordinary shares are recognised as a deduction from equity.
Annual Report 2008 - 65
Notes to the financial statements
for the year ended 31 December 2008 (continued)
(n) Reserves
The reserve to supplement capital is allocated from profit after tax and is to supplement share
capital. Financial reserve is allocated from profit after tax and is to cover losses incurred during
the normal course of business. These reserves are not distributable.
The bonus and welfare fund is allocated from profit after tax and is used primarily to make
payments to the Bank’s employees.
(o) Revenue recognition
Interest income is recognised in the statement of income on an accruals basis, except for
interest on loans classified in Group 2 to Group 5, as defined in Note 2 (g), which is recognised
upon receipts.
Fees and commissions are recognised when incurred or earned.
Dividend income is recognised when the right to receive payment is established.
(p) Operating lease payments
Payments made under operating leases are recognised in the statement of income on a straight-
line basis over the term of the lease. Lease incentives received are recognised in the statement
of income as an integral part of the total lease expense.
(q) Borrowing costs
Borrowing costs are recognised as an expense in the year in which they are incurred.
(r) Earnings per share
The Bank presents its basic earnings per share (EPS) for its ordinary shares. Basic EPS is
calculated by dividing the profit or loss attributable to the ordinary shareholders of the Bank by
the weighted average number of ordinary shares outstanding during the year.
(s) Segment reporting
A segment is a distinguishable component of the Bank that is engaged either in providing related
products or services (business segment), or in providing products or services within a particular
economic environment (geographical segment), which is subject to risks and rewards that are
66 - Annual Report 2008
Notes to the financial statements
for the year ended 31 December 2008 (continued)
different from those of other segments. The Bank primary format for segment reporting is based
on geographical segments.
(t) Related parties
Parties are considered to be related if one party has the ability, directly or indirectly, to control
another party or exercise significant influence over the other party in making financial and
operating decisions. Parties are also considered to be related if they are subjected to common
control or common significant influence.
(u) Off-balance sheet items
In the normal course of business, the Bank has entered into off-balance sheet commitments.
(i) Foreign exchange contracts
The Bank enters into foreign exchange (including gold) forwards and swaps which enable
customers to transfer, modify or reduce their foreign exchange or other market risks and also
trades these products for its own account.
Forward contracts are commitments to either purchase or sell a designated currency at a specific
future date for a specific exchange rate and are settled in cash. Swap contracts are commitments
to settle in cash at a future date based on differentials between specified exchange rates, as
applied to a notional principal amount.
(ii) Futures Commodity Contracts
Futures commodity contracts are commitments to either purchase or sell a designated commodity
at a specified future date for a specified price and may be settled in cash or another financial
asset, which enable customers to transfer, modify or reduce their market risks in terms of the
fluctuations in commodity’s prices.
The Bank acts as a broker for its customers in entering into futures commodity contracts.
(iii) Commitments and contingent liabilities
At any time, the Bank has outstanding commitments to extend credit. These commitments take
the form of approved loans and overdraft facilities. The Bank also provides financial guarantees
and letters of credit to guarantee the performance of customers to third parties. Many of the
contingent liabilities and commitments will expire without being advanced in whole or in part.
Therefore the amounts do not represent expected future cash flows.
Annual Report 2008 - 67
AUDITED FINANCIAL STATEMENTS 2008
Audited Consolidated Financial Statements 2008
“In our opinion, the consolidated financial statements present
fairly, in all material respects, the consolidated financial position
of the Group as of 31 December 2008 and the consolidated
results of its operations and its consolidated cash flows for the
year then ended, in accordance with Vietnamese Accounting
Standards, the Vietnamese Accounting System for Credit
Institutions and other relevant accounting principles generally
accepted in Vietnam.”
68 - Annual Report 2008
Corporate information
Banking Licence No.
0040/NH - GP 6 August 1993
The banking licence was issued by the State Bank of Vietnam and was
valid for 20 years from the date of the banking licence. The operation period
was extended to 99 years under Decision No. 330/QD-NH5 of the State
Bank of Vietnam dated 8 October 1997.
Board of Management
Mr. Ho Hung Anh Chairman
Mr. Nguyen Dang Quang First Vice Chairman
Mr. Nguyen Thieu Quang Vice Chairman
Mr. Tran Duc Luu Vice Chairman
Mr. Ngo Chi Dung Vice Chairman
Mr. Brian Fredrick Member (until 8/12/2008)
Mr. Nguyen Canh Son Member
Mr. Le Huu Bau Member
Mr. Hoang Van Dao Member
Board of Directors
Mr. Nguyen Duc Vinh Chief Executive Officer
Ms. Nguyen Thi Tam Deputy General Director
Mr. Pham Quang Thang Deputy General Director
Ms. Luu Thi Anh Xuan Deputy General Director
Mr. Nguyen Duy Phu Deputy General Director
Mr. Le Xuan Vu Deputy General Director
Mr. Nguyen Thanh Long Deputy General Director
Ms. Do Diem Hong Deputy General Director (from 1/6/2008)
Mr. Tran Hoai Phuong Deputy General Director (from 1/9/2008)
Ms. Nguyen Thi Thien Huong Deputy General Director (from 1/10/2008)
Head Office 70-72 Ba Trieu Street
Hoan Kiem District
Hanoi, Vietnam
Auditors KPMG Limited
Vietnam
Annual Report 2008 - 69
 KPMG Limited
10th Floor, Sun Wah Tower
Telephone +84 (8) 3821 9266
Fax +84 (8) 3821 9267
Consolidated balance sheet
115 Nguyen Hue Street Internet www.kpmg.com as at 31 December 2008
District 1, Ho Chi Minh City
The Socialist Republic of Vietnam

REPORT OF THE INDEPENDENT AUDITORS

2008 2007
To the Shareholders
VND million VND million
Vietnam Technological Commercial Joint Stock Bank
(Incorporated in the Socialist Republic of Vietnam)

Assets
Scope
Cash on hand and gold 1,565,968 496,173
We have audited the accompanying consolidated balance sheet of Vietnam Technological
Commercial Joint Stock Bank (“the Bank”) and its subsidiaries (together, “the Group”) as of 31
Balances with the State Bank of Vietnam 2,296,574 1,298,682
December 2008 and the related consolidated statements of income, changes in equity and cash Balances with financial institutions 15,647,089 9,303,685
flows for the year then ended. These consolidated financial statements are the responsibility of the
Group’s management. Our responsibility is to express an opinion on these consolidated financial Investments in securities 10,497,569 6,842,172
statements based on our audit. Loans and advances to customers 26,018,985 19,841,131
We conducted our audit in accordance with Vietnamese Standards on Auditing. Those standards Advances to purchase securities 921,250 645,000
require that we plan and perform the audit to obtain reasonable assurance that the consolidated
financial statements are free of material misstatement. An audit includes examining, on a test Long-term investments in equities 66,425 36,930
basis, evidence supporting the amounts and disclosures in the consolidated financial statements. Fixed assets 576,665 436,970
An audit also includes assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall consolidated financial statement presentation. We Other assets 1,478,530 641,753
believe that our audit provides a reasonable basis for our opinion.
59,069,055 39,542,496
Audit opinion
Liabilities
In our opinion, the consolidated financial statements present fairly, in all material respects, the
consolidated financial position of the Group as of 31 December 2008 and the consolidated results Borrowings from the State Bank of Vietnam - 301,993
of its operations and its consolidated cash flows for the year then ended, in accordance with
Balances and borrowings from financial institutions 8,970,269 8,458,903
Vietnamese Accounting Standards, the Vietnamese Accounting System for Credit Institutions and
other relevant accounting regulations stipulated by the State Bank of Vietnam and accounting Valuable papers 2,761,793 1,750,715
principles generally accepted in Vietnam.
Entrusted funds 231,961 161,170
Deposits from customers 39,617,723 24,476,576
General provision for commitments 34,203 25,216
Other liabilities 1,405,256 638,183

KPMG Limited Provision for taxation 422,442 156,324

Vietnam 53,443,647 35,969,080
Investment Certificate No: 011043000345
Audit Report No: 08-02-146/2

John T. Ditty Vo Thanh Phu Quoc

CPA No. N 0555/KTV CPA No. N1079/KTV
General Director

Hanoi, 12 March 2009

© 2009 KPMG Limited, a Vietnamese limited liability company and a
member firm of the KPMG net work of independent member firms affiliated
with KPMG International, a Swiss cooperative. All rights reserved

70 - Annual Report 2008 Annual Report 2008 - 71

Consolidated balance sheet Consolidated statement of income
as at 31 December 2008 (continued) for the year ended 31 December 2008

2008 2007 2008 2007

VND million VND million VND million VND million
Equity Interest and similar income 6,218,777 2,326,002
Share capital 3,642,015 2,521,308 Interest and similar expenses (4,458,034) (1,400,728)
Net interest income 1,760,743 925,274
Share premium 1,063,402 476,779
Other capital 371 371
Fee and commission income 543,270 206,958
Retained earnings 636,443 428,636
Fee and commission expenses (60,393) (30,022)
Reserves 283,177 146,322 Net fee and commission income 482,877 176,936
5,625,408 3,573,416
59,069,055 39,542,496 Foreign exchange gain – net 21,793 24,583
Dividend income 79,582 2,992
Income from securities trading – net 931,102 81,761
Off-balance sheet items
Other income 14,199 4,462
Letters of credit 2,879,247 5,455,192
Salaries and related expenses (405,506) (182,240)
Undrawn loan commitments 14,031 - Specific allowance for doubtful debts (537,171) (10,818)
Guarantees 2,283,271 1,348,279 General allowance for doubtful debts (71,774) (48,297)
Foreign exchange contracts 3,184,902 375,323 Reversal of specific allowance for doubtful debts 6,225 -
Gold contracts 122,697 - General provision for commitments (8,987) (19,937)
Allowance for diminution of investments in securities (148,318) -
Future commodity purchase commitments 1,395,433 6,051,861
Allowance for diminution of investments in equities (5,740) (1,835)
Future commodity sales commitments 1,414,321 5,881,154
Reversal of allowance for diminution of investments
in equities 1,835 -
Depreciation and amortization of fixed assets (42,244) (23,535)
General administration expenses (462,761) (219,606)
Approved by: Profit before taxation 1,615,855 709,740

Corporate income tax (432,772) (199,356)

Profit after taxation 1,183,083 510,384
Nguyen Duc Vinh Tran Van Chien Earnings per share (par value of VND10,000/share)
Chief Executive Officer Chief Accountant Basic earnings per share (VND) 4,259 3,235

Approved by:

Nguyen Duc Vinh Tran Van Chien

Chief Executive Officer Chief Accountant

72 - Annual Report 2008 Annual Report 2008 - 73

 Consolidated statement of cash flows
for the year ended 31 December 2008

-
-
1,761,687
1,331,939

510,384
-
(30,594)

-
3,573,416

1,272,357

1,183,083
-
(41,242)
(364,201)
1,995

5,625,408
Total
2008 2007
VND million VND million

(12,840)

(30,594)

(434,973)

(41,242)
86,253
-
-

-
103,503

146,322

-
611,075

-
1,995

283,177
Reserves

Cash flows from operating activities

Profit before tax 1,615,855 709,740
Adjustments for:
Depreciation and amortization of fixed assets 42,244 23,535

Chief Accountant
Tran Van Chien
(149,366)

(103,503)

(611,075)

(364,201)
General allowance for commitments issued 8,987 19,937
-

-
171,121

510,384

-
428,636

-
-
-

1,183,083

636,443
Retained
earnings

Specific allowance for doubtful debts – net 530,946 10,818

General allowance for doubtful debts 71,774 48,297
Allowance for diminution of investment in securities 148,318 -
Allowance for diminution of investment in equities – net 5,740 1,835
Other capital

Income from investment in securities (931,102) (81,761)

-
-
-
-
371

-
-
371

-
-
-

-
-
-
-
-

371
Dividend income received (79,582) (2,992)
Consolidated statement of changes in equity

Loss on disposal of fixed assets 1,221 458

Approved by:
Operating profit before changes in operating assets
and liabilities 1,414,401 729,867
(476,779)

(Increase)/decrease in operating assets

-
-
-
3,942
472,837

-
-
476,779

1,063,402
-

-
-
-
-
-

1,063,402
premium
Share

Balances with other financial institutions (897,531) (2,890,053)

Loans and advances to customers (6,780,574) (11,204,145)
Advances to securities companies to purchase securities (276,250) (645,000)
Other assets (836,777) (328,918)
12,840
-
1,500,000
859,102
149,366

-
-
2,521,308

208,955
434,973
476,779

Increase/(decrease) in operating liabilities

-
-
-
-

3,642,015
for the year ended 31 December 2008

Chief Executive Officer

Nguyen Duc Vinh
capital
Share

Borrowings from the State Bank of Vietnam (301,993) 244,110

Balances and borrowings from financial institutions 511,366 3,388,051
Entrusted funds 70,791 (116,137)
Deposits from customers 15,141,147 14,910,533
Transfer from reserves to share capital

Transfer from reserves to share capital

Valuable papers issued 1,011,078 1,558,473

Transfer from share premium to

Balance at 31 December 2008

Other liabilities 773,102 274,844

Balance at 1 January 2007

Balance at 1 January 2008

(VND million)

Cash inflow from operating activities 9,828,760 5,921,625

Corporate income tax paid (173,343) (74,697)
Utilisation of reserves

Utilisation of reserves
Net profit for the year

Net profit for the year

Transfer to reserves

Transfer to reserves

Capital contribution

Capital contribution

Utilisation of reserves (41,242) (30,594)

Other movements
Share dividends

share capital

Other movements 1,995 -

Dividends

Net cash inflow from operating activities 9,616,170 5,816,334

74 - Annual Report 2008 Annual Report 2008 - 75

Consolidated statement of cash flows Notes to the consolidated financial statements
for the year ended 31 December 2008 (continued) for the year ended 31 December 2008

These notes form an integral part of, and should be read in conjunction with, the accompanying
2008 2007
consolidated financial statements.
VND million VND million
Cash flows from investing activities 1. Reporting entity
Purchase of fixed assets and construction in progress (183,160) (122,662)
The principal activities of Vietnam Technological and Commercial Joint Stock Bank (“the Bank”),
Dividends received during the year 79,582 2,992 which is incorporated as a joint stock bank in the Socialist Republic of Vietnam, are to carry
Paid for investments in securities (10,267,884) (6,050,932) out banking activities, under Banking Licence No. 0040/NH-GP issued by the State Bank of
Proceeds from disposal of investments in securities 5,937,719 1,872,325 Vietnam (“SBV”) on 6 August 1993 for an initial period of 20 years. The operation of the Bank
was extended to 99 years under Decision No. 330/QD-NH5, dated 8 October 1997, of the SBV.
Redemptions of investment in securities 1,457,552 295,000
Acquisition of investment in equity (34,575) (7,982) The Bank’s Head Office is located at 70 - 72 Ba Trieu, Hanoi. As at 31 December 2008, the Bank
Net cash outflow from investing activities (3,010,766) (4,011,259) has one Head Office, 01 representative office, 01 Head Office transaction centres, 38 branches
and 114 transaction offices nationwide.

Net cash flows from financing activities As at 31 December 2008 the Bank had the following subsidiaries:
Issuance of share capital and share premium 1,272,357 1,331,939
% owned
Distributions to shareholders (364,201) (57) Nature of Capital
Subsidiaries Operating licence by the
Business VND’million
Net cash inflow from financing activities 908,156 1,331,882 Bank

Techcom Securities 98/UBCK-GP, dated 18 Securities 100% 300,000

Net increase in cash and cash equivalents 7,513,560 3,136,957 Company Limited September 2008 granted activities
Cash and cash equivalents at the beginning of the year 5,775,858 2,638,901 by State Securities
Committee.
Cash and cash equivalents at the end of the year 13,289,418 5,775,858
Vietnam 0104003519 dated 18 Asset 100% 70,000
Technological and June 2008 granted by management
Commercial Joint Hanoi Planning and
Stock Bank - Asset Investment Department.
Management
Non-Cash Investing Activities
Company Limited

Techcom Capital 40/UBCK-GP, dated 21 Fund 100% 40,000

2008 2007
VND million VND million
Management October 2008 granted management
Company Limited by State Securities
Dividends received in shares 75,743 - Committee.

As at 31 December 2008, the Group had 4,589 employees (31 December 2007: 2,929
employees).
Approved by:

Nguyen Duc Vinh Tran Van Chien

Chief Executive Officer Chief Accountant

76 - Annual Report 2008 Annual Report 2008 - 77

BRANCH NETWORK

7
12 8
9
5 10
1 4
Ha Noi
Our networking of 160 branches
6
11
2 and transaction offices over 29
provinces nationwide:

13 Northern Regions:
1 Ha Noi: 55 branches & offices
2 Hai Phong: 6 branches & offices
14
3 Lao Cai: 2 branches & offices
4 Quang Ninh: 3 branches & offices
15 5 Bac Ninh: 2 branches & offices
6 Hai Duong: 2 branches & offices
7 Lang Son: 1 branch
8 Thai Nguyen: 1 branch
9 Vinh Phuc: 4 branches & offices
10 Bac Giang: 1 branch
11 Hung Yen: 2 branches & offices
12 Phu Tho: 1 branch
16
13 Thanh Hoa: 1 branch
17 Danang
18

Middle Regions:
14 Nghe An: 3 branches & offices
15 Ha Tinh: 1 office
16 Hue: 2 branches

17 Da Nang: 9 branches & offices

19
18 Quang Nam: 1 branch

19 Binh Dinh: 1 branch

20 Gia Lai: 1 office

20
21 DakLak: 1 branch

22 Khanh Hoa: 2 branches & offices

21

22
Southern Regions:
23 Dong Nai: 3 branches & offices
24 Ba Ria – Vung Tau: 4 branches & offices
23 25 Binh Duong: 2 branches & offices
25
26 Ho Chi Minh City: 53 branches & offices
27 26 Ho Chi Minh City 27 Long An: 1 branch
28 24 28 An Giang: 1 branch
29 Can Tho: 3 branches & offices
29

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