--%>
Assignment Help - homework help

Bank assignment

You have just been hired as the branch manager for a big bank in XYZ. You were told that the bank is going to open a new branch at Island Learning Centre of the Open University of XYZ. The management of the bank is much concerned that the new branch might not be able to attract adequate customers to meet its gain projection. Your task is to propose the different services the bank must offer originally to form an adequate customer base. Below is a list of the services the branch could propose:

• current accounts
• savings deposits
• security underwriting
• personal trust management services
• retirement savings plans
• venture capital loans
• plant and equipment loans
• automobile loans
• residential real estate loans
• home improvement loans.

a) List five kinds of information you will require concerning the local community to aid you decide which of numerous possible services are likely to have adequate demand to make them gainful. Elucidate your answer in short.

b) Divide the probable services into two groups: those you think must be offered opening day and those you believe can be provided later as bank grows. Elucidate your outcome.

E

Expert

Verified

Part (a): Information collected from the local community include

(1) Historical growth rate of underwriting securities in domestic market. The bank can estimate the potential growth rate of this business. Securities underwriting can be profitable for emerging markets

(2) The sentiment of the property market. The sentiment of property market can determine the demand of the mortgage in the market

(3) The penetration rate of retirement savings. This information can help us to estimate the demand for retirement saving plans for the local community.

(4) The forth information required to determine the sentiment of the local population about investment services as it can help the bank to determine the potential growth rate of the personal trust services.

(5) The fifth information collected from local community is the factories in the city. It can be used to estimate the demand for plant and equipment and hence the amount of loans needed

Part (b):

The list of services that should be offered on the first day of business include:

  • Current accounts
  • Saving deposits
  • Residential home loans
  • Home improvement loans
  • Retirement saving plans and
  • Personal trust management services

 

The remaining part of the services in the list should be offered later. The first group of the services is the basic service offered by the bank to personals. For the new bank in the market, it is very important to obtain market presence. The first group of banking service is required to build up the brand.

   Related Questions in Corporate Finance

  • Q : Explain Indenture Explain the term

    Explain the term Indenture and also describe their provisions?

    		•
  • Q : Problem on annual lease payments Taurus

    Taurus Corporation needs a computer, which it can buy for $100,000. Taurus will depreciate the computer uniformly over its useful life of 5 years. An investment tax credit of 7% is also available, and the computer will have no residual value. Taurus plans to borrow th

    		•
  • Q : Could we explain that goodwill is equal

    Could we explain that goodwill is equal to brand value?

    		•
  • Q : Does the equity of shareholders have

    Does the equity of shareholders represents the savings a company has accumulated by the years?

    		•
  • Q : Relation between book value of shares

    Is the relation in between book value of shares or capitalization a good guide to investments?

    		•
  • Q : Could we explain that the shares’ value

    Could we explain that the shares’ value is intangible?

    		•
  • Q : Problem on Bank branch networks While

    While banks across the United States and Europe are cutting down their number of branches, the number of bank branches in Hong Kong has increased in the same period. Hong Kong Monetary Authority statistics show the number of bank branches in Hong Kong at the end of 20

    		•
  • Q : How companies accuse investors make

    Sometimes, companies accuse investors of performing credit sales which they make their quotations fall. Is it true?

    		•
  • Q : What is Project Budget Project Budget :

    Project Budget: Collecting all costs related with completing a project is budget process. The Project Management Institute states that "aggregating the predictable costs of individual actions or work projects (establishing) an authorized cost baseline

    		•
  • Q : Calculate their after tax cost of debt

    Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of whichrequire semiannual interest payments. Bond A has a coupon rate of 4.0%; a price qu

    		•