THE banking sector has been experiencing a roller-coaster journey for some time now. Non-performing loan is getting fattier and unless immediately and prudently addressed, it is not that far it will turn into a monster to jeopardise the whole sector and will leave us to feel the deep shock we narrowly escaped in 2009 while the United States and whole Europe are still reeling from that debacle.
Deposit scarcity had been the driving factor in the preceding years. It led to trigger deposit interest rate sky-high. And in a sharp contrast, managing idle deposit has been the most challenging task for the bank in recent months. Because of this apparently changing condition, we need to adjust fast and continuously with the market. Too much thoughts with a ‘not in a hurry’ approach will only make doing business difficult. Unless we address the fast-changing factors in time, it will dearly affect the business and with a nonchalant stubborn approach, we will lag behind scouting depositors and borrowers and will also risk losing our existing clients. Having diversified client groups, their asking supports will also differ and we must understand that a wholesale approach to put them in the same bracket will only backfire.
Corporate customers, having strong market reputation, are always a prime target for the banks and they are now desperate to add those entities to their portfolio. Having an option to choose from so many banks, and being persistently lured, because of the presence of too many banks, with aggressive offers, we do not have really too much time to kill to address their needs. Because of the corporate nature of the clients, they do always maintain a soft approach and there is always a risk to be complacent with their polite approach.
Putting them through a very common and sometimes prolonged decision-making process might end up losing these clients, who do not expose their annoyance rather end up switching to other banks, attributed to much more liberal approach by our competitors. Unless we learn to address their need with increased dedication, we would only pave the way for their exit. And if we do not perceive this drop-out symptom soon, there will be an exodus of our good clients very soon. Since doing business is now getting only more and more competitive, clients cannot afford to wait for months to listen from us.
Regulation should not cost opportunities
REGULATION is something that meant doing business in an ethical way under a set of given guidelines and to bar any business from doing wrong. Regulators are much more enthusiastic to practise their prescribed policies and to make sure that all stakeholders do follow their guidelines. Having like a home-grown perception to care about regulation, they are unlikely to care to facilitate our business unless we take the first move.
We, on the other hand, do exist to facilitate business and for very apparent reasons. We will be nowhere if we do corroborate with regulators in a much louder voice. Unless we save our business by accommodating an acceptable regulatory attitude and if we shy away from the regulators when we need to defend our customers for many obvious reasons, we will end up with a pile of circulars only and with so many run-away customers.
WHILE making ‘doing business’ easier is the policy everyone strives for, we cannot find ourselves busy with so many designated tiers. Starting with grilling from the desk officer’s table, the fish has to swim and survive through so many subsequent stages. Whenever there are minor distractions from the intricate regulatory policies, the executive concerned sounds so panicked as if helping these clients by compromising regulation to a slight extent will cost his career. Being positive and being pro-active and stepping a bit beyond regulation will not do much harm but will significantly benefit the clients and institution as well. Besides, if every time we come up with identical excuse such as ‘this is a violation of the circular’, then why we are here! Only to make sure that all pros and cons are strictly followed. Then who will speak for the customers, who will negotiate with the regulators on behalf of customers? And why do we always think that speaking for the clients will invite trouble for us. Are we not doing it with all fair minds and do our regulators not know that bank is going through inevitable crisis and we have to be lenient on many occasions only to save this bank? And unless we start feeling like that, how can we expect it from the others.
No pain, no gain
DESPITE going through some horrible financial disasters unfortunately, saving a very few, we, the core employees of the bank, hardly feel to get into deep. Do we really know how much damage was done and how much dedication and efforts we have to put in to recover from that peril? Unfortunately, no, and there are obvious reasons for that. Having a kind of virtual arrangement of monthly emoluments and other benefits are taken for granted often make us only complacent and oblivious of the fact. That is why when proactive role is the only option to save us from going bad to worse, we, at every level, from desk to decision-making, is busy displaying our knowledge only to intercept, instead of facilitating. Until we feel this pain at personal capacity, until our monthly salary, other benefits are not taken for granted any more, we will continue to behave in a bizarre fashion. Sophisticated appeal does not work for us any more. Until accountability is established for pro-business delivery, we will love to cause pain for the clients, and we do not really mind that.
GOOD clients, branch and head offices do have common and same interest and that is doing business. Unless we put our leg in each other’s shoes, we cannot understand what we are up to and how to function. As long as we will keep alienating from this group effort, we cannot deliver what is needed. Busy with finding flaws, proving the other party wrong, has been the dominating guideline for our work policy in recent times.
Reading between the lines
WE MUST learn to read the clients’ intention before drawing our boundary. There are clients, who are struggling, yet have a very strong intention to get going with the business and with the bank. If we do generalise them with the delinquent clients and offer identical treatment plan, in most cases the problem will remain unresolved despite the client having a strong resolve to solve it. In most of the times, we do not want to read between the lines and, rather, get busy with silly number and percentage. This attitude proved suicidal for the bank on many occasions because of procrastination or the denial of a solution. But this event always goes unnoticed and we never make anyone responsible for the collateral damage that is inflicted.
Without accountability, execution suffers
IF WE do not hold ourselves accountable to getting work done well and on time, there is a tendency to become even more lenient and forgiving for slippage. A day becomes a week, and a week a month. And since it happens once or twice, it becomes customary to forget to deliver on time. And plenty of lame excuses can be there to argue with and justify the habitual delays.
But, unfortunately, when we do not hold ourselves accountable, the impact is exponential. The delay becomes the team’s delay and a very few people, despite their urgency, cannot deliver to the clients in time and, rather, engage in a kind of rivalry with the colleagues. And last but not least, poor performance, or even mediocre performance, to continue helps to drive out the top performers and leaves behind the ‘C’ players.
Enough of rat race
IT CAN be safely concluded that ‘just profit’ has been the single driving factor of the banks. While most of the business community busy arresting their waning profitability and some already embracing losses for many factors and some of those remaining beyond their control, banks have been registering growing profits almost seamlessly, ironically their fatty income generates from those struggling business community. The ‘just profit’ attitude of the business school graduates, who are apparently destined to think of only imminent profit and not about consequences, set the tone for the subordinates to achieve high defying the fact if any opportunity always exists at all. That ends up in a kind of rat race among the banks to run after the apparently prolific clients who appear to be cash-cow and we go out with almost ridiculous offers only to seize those clients from their existing banks. Most of the times, this triangular drama does not benefit either party and cause permanent damage to the clients with over-financing gift which stops the clients’ capacity to repay at the end of the story.
Because of the extent of damage thaat banks have experienced systematically or otherwise in recent times, it is not probably a remote fear any more that the banking sector may experience a deep shock and will find it hard to absorb. Let us act wisely before it is too late.
Mahbub Alam Khan is deputy general manager of BASIC Bank.
Want stories like this in your inbox?
Sign up to exclusive daily email
More Stories from Opinion