Banking System 2

BRANCH PERFORMANCE MANAGEMENT SIMULATION

PARTICIPANTS MANUAL

(BranchSim Version 2.2)

© 2010 Belgian Bankers Academy

No part of this publication may be reproduced and/or published by printing, photocopying or on microfilm or by any other means without prior written permission of the Belgian Bankers Academy.

Contents

1. Introduction 5

  1.1. Objectives of the Simulation Programme 5

  1.2. Description of the Simulation Programme 5

2. Overview 6

  2.1. Description of the Variables 6

    2.1.1. Major Decision Variables 6

  2.2. Initial Conditions 6

  2.3. Description of the Branch 7

  2.4. Economic Environment 11

  2.5. The Three Market Segments 12

3. Key Management Variables 14

  3.1. Variable One — Products 14

    3.1.1. New Business 14

    3.1.2. Risk Premiums 14

    3.1.3. Branch Process Cost per Product 15

    3.1.4. Loan Repayment Periods and Deposit Reduction Periods 15

  3.2. Variable Two — Customers 16

  3.3. Variable Three - Marketing 17

  3.4. Variable Four — Operations and Process Management 18

    3.4.1. Tarification 19

  3.5. Variable Five — Distribution 21

  3.6. Variable Six — Human Resources Management 23

    3.6.1. Recruitment of Personnel 23

    3.6.2. Technical Training of Personnel 24

    3.6.3. Benchmark for staff performance 24

4. Decision Taking 26

  4.1. Methodology 26

  4.2. Decision Form 26

  4.3. Strategic continuity 26

5. Reporting 29

  5.1. Quarterly Reports 29

  5.2. Market Research Reports 29

      Introduction

1   Objectives of the Simulation Programme

The objectives of the simulation programme are to develop a basic understanding of the key factors that ensure maximisation of the performance of a retail bank's branch. The conceptual part of the course develops a theoretical framework relative to the key drivers that impact on the performance of a branch, whilst the simulation part provides participants with the...