Analyzing the Banking Sector Management (Case Study Sample)

Business Report- Case Study Analysis
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Executive Summary
This report tries to analyze the banking and finance sector of Australia, the causes of the financial constraints for the general public, and the economic crisis in that country. Some banks and bank managers will be used as a case study. The banks include the Commonwealth Bank, National Bank of Australia, ANZ Bank, and the Westpac bank, while the banks' managers include Elliot and Mr. Thorburn. The main thing that will be explored from these banks and bank managers is the misconducts involved in the systems of management as they perform their activities, as from the findings in the report of the Royal Commission. This report will highlight some of the corporate values employed by the Australian banks, team diversity, and style of leadership used by some of the banks' managers that lead to the failure of the corporate culture.
The report draws the banks' attention to unethical behavior to get profits from their activities without minding their clients. The customers are faced with financial crisis despite them being investing and saving their cash with the banks. Moreover, the report gives way forward on the specific findings of the Royal Commission report by providing the solution for these misconducts. It also provides the recommendations of the problem which includes;
* Banks indicating their core values which all members associated with them will be following
* Human Resource Development (HRD) to be employed in these banks by the human resources executives
* Banks to employ a culture of employing professionally trained staff to maintain their good reputation on the public
* Use of incentives to motivate workers to do the job enthusiastically
Contents TOC \o "1-3" \h \z \u 1. Introduction PAGEREF _Toc40539079 \h 42. Background PAGEREF _Toc40539080 \h 52. Case Study PAGEREF _Toc40539081 \h 82.1 Analysis of issues………………………………………………………...........................82.2 Identification of Problems………………………………………………………………112.3 Solutions……………………………………………………………………………….133. Discussion of Preferred Solution/s…………………………………………………………….154. Recommendations………………………………………………………………………..……165. Conclusion………………………………………………………………………..………….16 5.1 Key Learnings………………………………………………………………………..176. Reference List……………………………………………………………………………..187. Appendix……………………………………………………………………………………22
1. Introduction
Banking is a sector in the economy that deals with credit, cash, and many other transactions that involve financial matters. Banks are meant to provide individuals with a safe area to store their extra credit and money. They also offer services like saving accounts and deposit certificates, among others. It is from the deposits made by the other clients that the banks use to provide loans to others. The credits may include vehicle loans, home mortgages, or organization loans. Banks also pay the persons that save their money with them in the form of interest. Insurance Corporations cover the banks of many states to increase security for them, making it the safest place to deposit excess cash for saving or future use. It should be noted that the relevant government bodies license banks for their operation. There are many types of banks, which include commercial banks, retail banks, investment banks, saving and loans banks, to name a few. The banks perform effectively with excellent management from the top officials.
Banks experience enormous losses due to a lack of good management. Generally, the finance and banking sector is keenly scrutinized by many parties because of its delicacy. People want to be assured of the safety of their money when they deposit and save them in banks. The main aim of banks is to make profits from their activities. The bank managers do the coordination of these activities. It ensures that there is an optimum interaction of the bank's organs to generate maximum profits. Although, with this in mind, some managers of banks have incorporated illegal activities that have led to modern bank scandals. For instance, there are allegations of misconduct in the Australia banking sector from a scholarly and theoretical perspective. The main aim of this research paper is to come up with a range of solutions and recommendations that the banking sector should use as a short term step in the corporate culture.
1.1 Background
Since 2007, the Australian banks have been charged over one billion dollars to compensate for losses made by their clients. The pilots of these unethical practices to customers are not well known. A Royal Commission was formed in December 2017 to find the possible complications in the laws of finance services. The unstable finances situations resulted in the commission established in the community of Australia. Peter Costello, the former federal treasurer, was noted criticizing the regulators of Australia corporate about their inadequacy in the supervision of financial activities in the banks. He was blaming them for ignoring the erupting problems, making the banking behave unethically (Atkins & Charlton, 2019, p. 65). Mr. Peter Costello said that the bank managers are not doing their duties. The chairperson of the Royal Commission also reported that the management in the financial sector is not only following the law but also not enforcing it effectively.
The Royal Commission revealed the most organizations wanted to make a profit without considering putting in place the interest of their clients and, above all, not adhering to the law. For instance, the Commonwealth Bank of Australia (CBA) did not give enough attention to the risks of non-financial activities such as adherence to anti-money laundering and counter-terrorism laws. Besides, the bank did not timely fix these problems. The National Australia Bank was also questioned for charging the adviser service to retirement fund members. It was also cautioned for its failure to make an appropriate proposal timely to the regulatory body so that its customers would be rectified. The management of these banks was criticized for failing to do their obligation and not behaving in the best interest of the members (Burgess & Boyle et al., 2017, P. 63). The cases of misconduct, such as fees’ payment’ for no service and conduct of corporate agents, were also exposed.
There was also the issue of bank managers allowing the names of the dead individuals to be used as active customers. It made the clients' funds reducing making them go backward in terms of finance because the charges made from their accounts surpassed the investment returns (Chohan, 2017, p. 101). The most affected clients were those who invested in their retirement fund. Although some managers were justifying themselves that much time was spent scrutinizing the client list, and their challenge was that process was done manually. Indeed, this seemed to be a tiresome job, but why could they incorporate information and technology system to store their customers' data in computers.
The Royal Commission also raised the issue of trust, where the finding showed that many banks did not involve all the stakeholders to maintain this trust. The stakeholder’s members include customers, employees, shareholders, and the community at large (Gilligan, 2018, p. 180). The social license was required to maintain the trust between the stakeholders, which was not issued by then. The question is, how did these banks operate without the social license? The final report from the chairperson of the Royal Commission, Hayne, criticized the management of the National Australia Bank (NAB) lead by CEO Mr. Thorburn and Mr. Henry about this conduct. It made the CEO of the NAB face the parliament in 2018 along with other victims of bank allegations that the Royal Commission did not scrutinize. As Mr. Thorburn was justifying himself during the proceeding, he introduced an issue that was a doubtful scheme called the ‘Introducer Program.’ Through this pro...