Reconciling board and management perspectives

The client
Our client on this assignment is a mid-tier commercial bank regulated by the Central Bank, and in which the state was the majority shareholder.  
This bank was formed through the acquisition of nine insolvent banks as part of a wider government initiative that aimed at strengthening the local financial services sector through a variety of other measures that included re-capitalisation, review of capital adequacy and liquidity ratios asset quality and compliance with various supervisory and regulatory requirements.
The bank's board of directors had changed mid 2019, which was two years into the bank's strategic plan.  Six months later, COVI-19 hit, and the bank's business plan for the year and beyond was not going to serve.  The new board also had various ideas on how the bank was going to face its ongoing challenges, which challenges management felt it was managing just fine.  Post COVID, the bank needed to review its strategic plan, incorporating input from the new board,  mitigating the effects of the COVID-19 period to put the bank back on course.
Client requirements
Over and above the negative impact of COVID-19 on global financial services, the client had been recording declining profitability and needed to urgently review its strategy.  The client specifically needed a comprehensive review review and analysis of factors variously impacting the business and a detailed plan to put the business back on course in the shortest time possible.
Our approach
Working in close collaboration with both the board and management, we undertook the following:
1.    review of the bank's current strategy, objectives and performance against set targets
2.  review of the bank's operating environment, including local, regional and global industry and macroeconomic performance drivers impacting the bank
3.  analysis of contextual factors uniquely impacting the bank as a state-owned enterprise, including including legal, regulatory, statutory and other considerations
4.  evaluation of revenue, cost, risk and operational efficiency factors in the bank's current business model and how future models would need to change post COVID-19
Significant outcomes
Most importantly, the client was able to harmonise board and management perspectives on the bank's future.  A new strategic plan was obtained, which has guided the bank post-COVID 19 to grow its revenues, grow its assets, and to considerably improve its profitability.

ARTEMIS Transition Partners

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