Retail Banking - Introduction

Session 1: Review
Objective: Setting out the basics
 What is a bank
 The role of banks
 Type of banks
 Client base
 Services
 Personnel
 Economies of scale
 Management structure
 Regulation & reporting
 Shareholders expectations

Session 2: Deposit Taking & Savings Products
Objective: To understand deposit and savings products
 What is a deposit?
 Why do banks need deposits?
 Current, Short, Medium & Long Term Deposits
 Pricing & advertising
 Retail Deposits & Business Deposits
 Savings Products
 Money laundering constraints & know your customer
 Deposit protection

Exercise: What is the main difference between current, deposit and fixed term accounts? Which is the most attractive to the bank and why?

Session 3: Account Opening Procedures
Objective: To understand what basic steps are required when opening accounts
 Know your customer requirements & money laundering
 References & Introductions
 Documentation
 Current/checking accounts
 Deposit/savings Accounts
 Personal Accounts
 Business accounts
 Corporate accounts
 Banks duty of secrecy

Exercise: You are asked to open a checking account for a new personal client. What references will you need? What paperwork is required? Do you have to meet the client in person? Why?

Session 4: Lending Products
Objective: To understand the different types of lending products
 Overdrafts & loans
 Medium & Longer Term Finance
 Asset finance (including Vehicles, Plant, Machinery etc)
 Leasing
 Mortgages
 Personal Lending
 Business Lending
 Corporate Lending

Exercise: What is the most common form of lending at your bank? Why is this?

Session 5: Other “Non-Funds” Based Retail Banking Services
Objective: To understand the different types of services available from a retail bank in addition to deposits and loans
 Safe Custody
 Forex
 Travel Facilities
 Dealing Services
 Executor & Trustee services
 Investment Management
 Dealing/Broking Services
 Insurance
 Private Banking
 Wealth Management
 Trade Finance
 Money Transmission Services

Exercise: All Retail Banks seek to boost earnings by selling additional services. What is being targeted by your branch/department? How successful have you been? What would you change, if anything?

Session 6: The Basic Principles of Lending
Objective: To consider basic lending skills
 People skills
 “CCCPARTS”
 Secured lending
 Loan to value calculations
 Unsecured lending
 Loan authorisations
 Funds release procedures
 Control of lending
 Regulatory considerations

Exercise: What is the most important consideration when granting or assessing a loan? What is the least?

Session 7: Introduction to Credit Analysis
Objective: A first look at bank credit analysis.
 What to look for
 Budgets & Forecasts
 Track Record
 Sector & Segment Considerations
 Security
 The Credit Appraisal Process
 Applying to the Credit Committee

Exercise: You have been approached by a good and valued client who is looking to take on a major commitment. You know they will need some bank debt. What do you want them to produce prior to a meeting to discuss this?

Session 8: The Basics of Risk Management
Objective: To consider the usual risks facing a retail bank.
 What is risk
 Types of banking risk
 Monitoring & control
 Branch/Unit security
 Reports, limits, excesses
 Risk control

Exercise: What are the biggest risks facing your department? How are these monitored? How are they managed?

Session 9: Introduction to Debt Collection and Recovery Procedures
Objective: Understand why loans go wrong and what to do about it.
 Why loans go wrong
 The five usual reasons.
 Other reasons
 Cant pay or wont pay
 Early warning signs and how to spot them
 When to act

Exercise: To suit group requirements.

Session 10: Sources of Funding – The Basics
Objective: An understanding of funding sources available to a retail bank.
 Current, Deposit and term accounts
 Money markets
 Savings & investment products
 Inter bank markets
 Commercial paper
 Liquidity crisis issues

Exercise: Liquidity is the key to managing any retail bank successfully. What are the key risks in this area?

Session 11: Distribution Channels – The Basics
Objective: How to operate a retail banking operation and the role of technology
 Distribution Channels
 Branch network
 Other organisations
 Internet

Exercise: To suit group requirements

Section: 12 – Technology – The Basics
 Importance
 Cost
 Client requirements
 Management requirements
 Regulatory Requirements
 Civil Service model

Exercise: Consider what minimum distribution channels are needed in your organisation.
Exercise: Consider what minimum technology is needed in your organisation.

Session 13: A Brief Look at the Banking Crisis
 What is it
 What caused it
 When will it subside
 How will it affect your organisation
 Consequences for retail bankers

Session 14: The Future of Retail Banking
Objective: To consider the possible ways forward for the sector
 Traditional Definitions
 Generalists versus specialists
 “Big Bang” theory and retail deposits
 Delivery mechanisms
 Costs versus service
 Retail outlets options
 Telephony
 Internet banking
 All inclusive banking
 Microfinance

Exercise: If you could design your own retail bank, what would it be like? Could you make this model commercially viable?

Session 15: Summary & Group Forum