Luận văn thạc sĩ UEH deposit insurance, a study of vietnamese households knowledge and perception ,

MINISTRY OF EDUCATION AND TRAINING

UNIVERSITY OF ECONOMICS HOCHIMINH CITY

TRẦN THỊ HỢP

DEPOSIT INSURANCE: A STUDY

OF VIETNAMESE HOUSEHOLD’S

KNOWLEDGE AND PERCEPTION

MASTER THESIS

Ho Chi Minh City – 2012

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MINISTRY OF EDUCATION AND TRAINING

UNIVERSITY OF ECONOMICS HOCHIMINH CITY

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TRẦN THỊ HỢP

DEPOSIT INSURANCE: A STUDY

OF VIETNAMESE HOUSEHOLD’S

KNOWLEDGE AND PERCEPTION

MAJOR: FINANCE-BANKING

MAJOR CODE: 60.31.12

MASTER THESIS

SUPERVISOR: Assoc. Prof, Ph.D. TRẦN HUY HOÀNG

Ho Chi Minh City – 2012

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ACKNOWLEDGE

This dissertation would not have been able complete without the support of

many people. Firstly, I wish to express my deep gratitude to my supervisor, Assoc.

Prof, Ph.D. Tran Huy Hoang for his valuable guidance and advice.

I would like to express my deepest gratitude to all instructors at Faculty of

Finance and Banking, University of Economics Ho Chi Minh City (UEH) for their

valuable knowledge during my study in UEH.

Special thanks to Dr. Vo Xuan Vinh for his useful advice for choosing a

suitable thesis’s research problem, and Master Nguyen Thanh Trung for his

enthusiastic support for this study.

My thanks and appreciations go to all my classmates, especially Ms. Pham

Thi Xuan Lien and Ms. Nguyen Hong Vinh for their comments in English editing.

I also wish to thank my friends in Techcombank, Citibank, BIDV, Maritime

Bank, Agribank, my colleagues and interviewers for their great supports. My thanks

would also go to the households that agreed to participate in the survey.

Finally, I would like to express heartfelt and deepest gratitude to my beloved

parents, my husband and my son who are encouragement for me to overcome all

difficulties through the duration of my study.

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ABSTRACT

During the global financial crisis, many countries sought to reassure

depositors that their savings in financial institutions were safe. If depositors feel

unsure about the safety of their deposits, there is a great probability that they will

withdraw their funds when they know insured institution encounter the unsound

problems. If bank runs become widespread, it can affect the overall economy.

Therefore, public must be well informed about the benefits and limitations of

deposit insurance to build and maintain confidence in the financial system. In

addition, a well-designed public awareness program is essential in order to prevent a

bank run.

The objective of this study to investigates the knowledge about existing

deposit insurance organization in Vietnam and its basic features among a sample of

households. A study of 326 respondents was conducted in Ho Chi Minh City and

two nearby provinces. Statistics and logistic regression techniques were applied to

test hypotheses and analyze factors impacting on the public awareness of deposit

insurance. The result of the paper shows that knowledge of deposit insurance is not

widespread in Vietnam: about 60 percent of the households in the sample are

completely unaware of its existence, 30 percent possess the basic knowledge, and

only 10 percent give detailed information. The findings highlight the significant

determinants of deposit insurance awareness that are internet, education, and bank.

Keywords: Deposit insurance of Vietnam, deposit insurance, public awareness

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CONTENTS

ACKNOWLEDGE................................................................................................i

ABSTRACT......................................................................................................... ii

CONTENTS........................................................................................................ iii

LIST OF TABLES ..............................................................................................vi

LIST OF CHARTS ........................................................................................... vii

LIST OF ABBREVIATES .............................................................................. viii

CHAPTER 1: INTRODUCTION...................................................................... 1

1.1 Introduction ...................................................................................................1

1.2 Research background .....................................................................................1

1.3 Research objective .........................................................................................3

1.4 Research questions.........................................................................................3

1.5 Methodology ..................................................................................................4

1.6 Scope and limitation.......................................................................................4

1.7 Structure of the study .....................................................................................5

CHAPTER 2: LITERATURE REVIEW...........................................................6

2.1 Introduction....................................................................................................6

2.2 Overview of Deposit insurance .....................................................................6

2.2.1 The Concept of Deposit Insurance...................................................6

2.2.2 Objectives and role of deposit insurance .........................................7

2.2.3 Deposit insurance: the facts.............................................................8

2.2.4 Case of Deposit insurance in Vietnam.............................................9

2.3 Related literature......................................................................................... 11

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2.3.1 Deposit insurance and public awareness .......................................11

2.3.2 Other efforts to investigate the public awareness..........................12

2.4 Developing of empirical research hypothesis..............................................14

CHAPTER 3: METHODOLOGY ...................................................................18

3.1 Introduction..................................................................................................18

3.2 Research design ...........................................................................................18

3.3 Pilot test .......................................................................................................20

3.4 Main study ...................................................................................................21

3.4.1 Target audience selection...............................................................21

3.4.2 Sample size ....................................................................................22

3.4.3 Survey method ...............................................................................22

3.5 Data analysis techniques..............................................................................23

3.5.1 Descriptive statistics ......................................................................23

3.5.2 Multivariate analysis......................................................................23

CHAPTER 4: DATA ANALYSIS AND FINDINGS......................................25

4.1 Introduction..................................................................................................25

4.2 Description of collected sample...................................................................25

4.2.1 Final sample ...................................................................................25

4.2.2 Characteristic of sample.................................................................26

4.3 Results and discussions................................................................................27

4.3.1 Knowledge about the Vietnam DIS .............................................27

4.3.2 Find out determinants of awareness...............................................32

4.3.3 The negative answers.....................................................................36

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4.3.4 Different level of knowledge .........................................................40

4.3.5 A multivariate analysis .................................................................41

4.3.6 Review the findings of the study ...................................................45

CHAPTER 5: IMPLICATIONS AND CONCLUSION.................................46

5.1 Introduction..................................................................................................46

5.2 Implications of the research.........................................................................46

5.3 Limitations of the research and further research .........................................49

5.4 Conclusion ...................................................................................................50

5.4.1 Summary of hypotheses.................................................................50

5.4.2 Final conclusion .............................................................................51

APPENDIX 1 - Questionnaire ..........................................................................53

APPENDIX 2 - List of financial experts and depositors................................59

APPENDIX 3 - Descriptive Statistics of variables..........................................60

REFERENCES ........................................................................................ 67

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