Ateneo Professional School
Makati City
July 27, 2016
I tried doing a bp myself. I am doing this for a rural bank which was just acquired and I was asked for advice on how to turn this around. The BSP requires a BP too:
I started getting the inputs Monday, I attended their informal meeting yesterday. I started working on this this morning and was done by 12:30
3 days from input to output of a draft 5 hours to draft What am trying to say: You can do it YOU CAN SUBMIT THE DRAFT
I Background:
The San Francisco bank was recently acquired from its former owners recently, (March) It was established on December 11, 1959 as the 235th rural bank to serve then the growing QC area area. It has because of its managementand owners kept up with the times. It stopped lending for a time, has only about 1.300 depositors
It has been acquired by CBC group headed by dynamic business woman CBC who is engaged in construction, real estate, luxury goods trading and lending investor.
Its management team and Board of Directors: include:
1. Mr. AG President and Director former head of a chemical petrochem plant, and now heads the first solar manufacturing plant in the PHL
2. Mr EV - VP and Director, formerly from from two large commercial bank
3, Mr. EMR - Manager of Operations, formerly cluster head and Senior Manager at a Universal Bank
Its financial is as follows (as of June 30, 2016)
Total Assets: 101,071549
Total Loan Portfolio net 54, 630,154
Total Deposit 67,601,975
Total Stockholders Equity 31,447,315
PNL for the first 6 months of 2016
Income 4,788,013
Expenses 5,072,846
Income/Loss 264,883
II Opportunity Scanning:
Macro:
1. Increasing Philippine Population
This will be the driver for increased consumption (salary loan) and other businesses
2. Political (more peace and order)
The new President is intent on crushing drugs and criminality, and corruption. The peace and order will usher in more investments and business activity.
The govt wants to lift the poor from poverty (we can not legislate that you get out of poverty. You have to work yourself - Duterte)
3. Social
The poorest of the poor about 70% of the population, the CDE segment are short of cash. They get financing from Bombay, and pawnshops where they get 2 to 4% rate per month on the average.
This segment of population need micro insurance, microfinance and other services.
Consumerism is on the rise and even the poor want to have aspirational products and gadget
4. Environmental (business)
1. Many banks have closed due to various financial crisis further upping the demand for financial services
2. Most U Banks and Kbanks are serving the upper and middle market and neglecting the lower market. They have neglected and left out the small lower market being not cost effective.
(We cant quantify these yet)
III. Business concept and model
Concept Banking (not just rural banking) Serving financial needs of many people with courtesy speed and concern
Model
Ptm - middle and lower market
Link - personal through private bankers, text, emails, and social media, website, portal
Bond - crm and personalized service by private bankers and staff
Key Process - loan processing, deposit, private banking, services:
bayad center, micro insurance, bank assurance
Key resources: computer software for :
bank transactions, website for private banking, bank office,.
liquidity
' bank staff:
lending and collection
treasury
risk management
asset and liability management
Partners: condominium owners
high value friends of CBC
Cross over technology (solar power manufacturer)
developers and businessmen
Western Union Bayad Center, commercial banks
SSS, HDMF, BSP DBP (for loan origination)
ATM backbone (Megalink)
Western Union Bayad Center, commercial banks
SSS, HDMF, BSP DBP (for loan origination)
ATM backbone (Megalink)
MVP quick and hassle free competitive lending
value and security for your money
Financial:
Revenues - 12%
Cost of money 2%
Spread 10%
Revenues: Fee based: 1/2 of 1% to Max of 5%
Revenues: Fee based: 1/2 of 1% to Max of 5%
Positioning: San Francisco Bank (as bank)
Geographical coverage : MM and NCR
Strengths: Solid financial condition
Location - MM
Connection of the owner and BOD
Weakness: x corporate officers
lack of deep talents for banking; sparse staff for real banking
mixed interest of the owner (can be source of lack of focus)
unknown to many to the banking public
limited market at the moment
Strengths: Solid financial condition
Location - MM
Connection of the owner and BOD
Weakness: x corporate officers
lack of deep talents for banking; sparse staff for real banking
mixed interest of the owner (can be source of lack of focus)
unknown to many to the banking public
limited market at the moment
IV Business Objectives:
Vision: We envision the economic upliftment of the entrire San Francisco del Monte by providing financial aid to its small businessmen and small industrialists.
Mission:
1. We behold our leadership in nation building by encouraging and promoting entrepreneurial leadership with its expanding and extensive products and services in order to effectively address our clients' needs. Our commitment is excellent service to the people we prioritize - our patrons, our shareholders and whole community
2. Dedicating service to the new entrepreneurs by providing them a highly accessible financing window. We believe in:
1. Encouraging nationwide agricultural, industrial, and commercial development though organization of cooperatives and associations aof marketing of their products to assure the viability of their continuous operations
2, Providing funds to entrepreneurs and other types of businesses to avoid their being victimized by high cost of usurious sources of capital
3. Maintaining a friendly relationship between the bank and its client by immediate attendance to their needs.
The rural bank is a child of RA 720 Rural Banking Act
Business objectives:
Objectives and Key Result Areas
Year Equity Liability Total Asset Loans
1. 30M + 20 150 200 110
2 70 250 320 188
3 100 350 450 262
4 120 500 620 375
5 150 850 1,000 637
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