Courses

Strategic planning for banks

  • Banking and financial courses

Why it is important

Sweeping changes have taken place in the global financial system over the past few years, largely as a consequence of the 2007-2008 financial crisis, on the one hand, and partly reflecting the low interest rate environment and the breakthrough of new financial technologies, on the other. Over the past ten years, the persistently low interest rate environment, the growing use of bank digitisation and changes to micro and macroprudential regulations have posed a very significant challenge to banks living with the consequences of the crisis. Drawing from past experience, challenges can only be successfully addressed by a comprehensive change of attitude and with trained management displaying breadth of vision. Accordingly, the course has been designed to provide an ideal platform for meeting the challenges facing the financial system, for adjustment to the changing regulatory environment and for placing bank strategic thinking on new, more modern foundations than before.

Course content

During the course, participants obtain theoretical and practical knowledge of the factors influencing banking operations. First, students become familiar with the role the financial intermediary system plays in the national economy, the importance of market structure and the current regulatory environment. As a second step, the course explores the key factors driving banking operations, which can be grouped into four major categories: macroeconomy (GDP, unemployment, inflation, wages, etc) financial market – (exchange rates, interest rates, financial market volatility, bond and derivative markets, etc), micro (price and non-price credit terms on a given bank’s new loan applications, marketing costs, regional coverage, fintech, competitors’ behaviour, dividend policy, etc) and regulatory environment (CRD/CRR, Mifid II, country-specific capital and liquidity requirements, other legal environment). During the course, students not only learn what high interbank rates mean for banks’ income flow, but they also learn to think in a complex system, i.e. that in this endogenous impact channel not only first, but also second and third-round effects are at work. Not to mention the involvement of other variables: low interbank rates not only affect income through margins, but also through lending activity. In this complex system, students will measure the effect of the chosen variables on a bank’s balance sheet and its main items as well as on its income statement and its main items. Over the medium and long term, i.e. from 5 out to 10 years, all this is important not only for planning cash flows and other strategic indicators, but it also fundamentally determines the analysis and assessment of banks’ financial performance. Mergers and acquisitions, induced by the low interest rate environment, will be integrated into the strategic planning framework during the course. These help exploit synergies, which in turn may have a positive impact on banking income. The last step provides practical knowledge to participants: the effect of all chosen, relevant variables on the bank’s balance sheet and income statement are tested in a simulation exercise.

Course objectives

  • Obtain comprehensive knowledge of the characteristic features of the financial intermediary system and adjustment to the changed situation following the financial crisis.
  • Understand the effect of banks’ macro, financial and micro regulatory environment building on the example of a given bank.
  • Acquire skills to implement a modern strategy for banks and address challenges.
  • Obtain a BIB Banking Strategic Expert certificate and the opportunity to join a network of leading experts working in the financial industry.

To whom the course is recommended

The course has been designed to provide adequate knowledge primarily to medium and higher-level financial managers who are involved in the preparation of the bank’s business plan annually, and manage and participate in the implementation of the medium and long-term strategy of the given bank. A precondition for participating in the course is at least five years’ experience in the areas of business planning, accounting or strategy. Students may acquire the skill to respond to challenges facing bank strategic planning in a fast, targeted and successful way via two successive theoretical and one practical module.

Structure of the course

Module 1: Role of the financial intermediary system in the economy

Module 2: Business planning, strategy implementation – key factors affecting the balance sheet and income statement

Module 3: Exercise using a practical bank simulation programme

Available courses and exams

For more information, please contact our education organizer

Barbara Kozma
phone: +36 20 392 4228
e-mail: kozma.barbara@bib-edu.hu