Turning Around Consumer Banking Business

Client

One of the largest banks in the GCC.

Issues

The bank had one of the largest retail branch networks and the largest Consumer Banking customer base in the GCC. However, the line of business was not delivering adequate returns to shareholders.

Project

The objective of the project was to turn-around the Consumer Banking business of the bank. As part of this initiative, three specific assignments were conducted:

Market sizing: The assignment entailed sizing the market for Consumer business in the country to determine market size by customer and product type, identifying the largest as well as the fastest growing segments. A projection of most likely growth segments of the market was then made.

Customer segmentation to optimize business potential: The project involved segmenting existing customer base by socio-economic categories, identifying core segments with highest potential and reposition from a product centric to customer centric Consumer Business.

Outcome is a sharpened focus on attractive segments, a conscious move to discourage 'non-target' segment customers, targeted product development and ensuring customer migration and retention as life cycle changes occur.

Distribution system optimization: The assignment’s objective was to optimize the bank's distribution system and costs by determining the right mix and role for the various distribution channels (types of branches, ATM's, phone banking and Internet). The single largest embedded costs are found in a Consumer business's distribution system.

Unless a clear understanding and strategy is developed identifying the role and mix of distribution, substantial misdirection of investment can occur. Distribution mix determination is aligned to the businesses target customer segments.