Download Case Study Planning Rural Bank and more Essays (high school) English in PDF only on Docsity! Organization and Management RURAL BANK OF SUARES Grade 11 - A.B.M. I. Point of View The Stockholder’s point of view will be used since they already identify the problems that the bank may face. Normally, stockholders, by virtue of their description, are imbued with tipping point decision influences either by virtue of their majority. Shareholders may also have the opportunity to influence certain major business decisions either through exerting pressure on board members and management or through formal voting. I. Problem Statement If you were the controlling stockholder of RBS, how would you vote on Arguelles’ proposal to open a branch office in the capital city? Why? Ill. SWOT Analysis STRENGTH ¢ RBS attracts people to make loans even though it is located 25 kms, Away. This suggests that its loan package has enough pull and attractive enough to gain customers from the city. ¢ RBS is currently in good health with asset to liabilities ratio of 130%, deriving 19.3% interest from its loan exposure up from previous year 18.9%. Its savings account base increase by 18%, and time deposit by 40%. WEAKNESSES ¢ Loans-to-assets ratio and total debt to asset ratio of the bank is quite high. This means that the bank loaned up and the liquidity is low. This is risky for the bank to have high loans-to-asset ratio. It may negatively affect how lending companies may approve their proposal to loan if they will pursue buying lot and building. ¢ RBS has limited capital to fund any aggressive expansion plan. If expansion pushes through it would require borrowing from a commercial bank 80% its expansion capital. ¢ The information provided by Mr. Arguelles is incomplete. It has no estimate of the breakeven volume to compensate for its investment and operation. OPPURTUNITIES ¢ Population in the capital city is more than 10% of Suares. * Opening a branch in the capital city already has sure borrowers. * Rehabilitate the conditions of the Rural Bank. THREATS
