Delivery Functional Lecture

2

Executive Banking School Objectives

Retail Strategy• Customer acquisition• Branding &

marketing• Product & pricing• Delivery optimization

Bank Management Strategy• Economic value & risk• Capital considerations• Analyst influences• 360° executive

management

Financial Strategy• Financial analysis• Key performance

drivers• Earnings power• Risk considerations

3

MarketSim Objectives

4

Functional Lecture Objectives

To focus on areas of responsibility To review decision responsibilities To review the tool kit of worksheets To discuss common issues To answer common questions

5

The Role

Delivery Officer

Analyzes the prior year's distribution activity Makes branch and ATM opening and closing decisions Sets alternative delivery and level of service strategies

for the coming year Projects future distribution results for the retail

balanced scorecard Performs other assignments applicable to the

distribution function

6

MarketSim Process

Analyze

Plan

ForecastExecute

ReviewRetail Bank

MarketSimProcess Flow

7

MarketSim Process

8

Analysis

9

Analysis

10

Branch Distribution Report

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Distribution Report

12

Distribution Report by Channel

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Distribution Report by Sector

14

Sector Profitability

15

Planning and Forecasting

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Delivery Appeal Worksheet

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Branch Cost Per Transaction Worksheet

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Branch Cost Per Transaction Worksheet

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Other Costs Per Transaction Worksheet

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Other Costs Per Transaction Worksheet

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Execute

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Branch Decisions

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Call Center Decisions

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Mobile Banking Decisions

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Online Banking Decisions

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Stand Alone ATM Decisions

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Branch & ATM Decisions by Sector

28

Call Center Decisions

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Mobile Banking Decisions

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Online Banking Decisions

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Standalone ATM Decisions

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Branch Type, Costs & Capacity

New Model Fixed Exp.Transaction

CapacityAnchor 900,000$ 350,000 Full Service 774,000$ 315,000 Traditional 672,000$ 280,000 Instore 600,000$ 250,000 Tellerless 504,000$ -

33

ATMS

Can only work in multiples of 3

Can only have 60 in any given Neighborhood ATM Type

Fixed Expense per

MachineTransaction

CostSmart $ 65,000.00 0.10 Traditional $ 25,000.00 0.06 Cash Dispenser $ 12,000.00 0.02

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Best Practices

Fixed Expense versus Variable Expense Transactions and Capacity How much is enough and how much is

affordable?

35

Today’s Assignment

Complete a new Bank Condition Consensus Worksheet Review Customer Projection Worksheet Results – try to

explain the outcome using the Competitive Report Using completed Delivery Appeal Worksheet to

determine where to place branches, ATMs and what level or service to offer

Complete Delivery Optimization Worksheets reflecting your assumptions about changes to your delivery channels

Complete the Customer Projection Worksheet Make Delivery Decisions

36

Review Course Objectives

To focus on areas of responsibility To review decision responsibilities To review the tool kit of worksheets To discuss common issues To answer common questions

37

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