Challenge A leading bank was suffering unusually high levels of retail loan delinquency, which spiked above 20% during an economic downturn. Lending staff were rewarded on the basis of loan volume rather than quality while most loan underwriting and all collections were done solely at the branch with minimal audit.
Challenge A second-tier bank with a strong multichannel platform that was focused on the mid- to low-income retail and SME market enjoyed a decade of rapid growth during a buoyant economy. While the bank’s credit and market risk management capabilities successfully kept pace with its expansion, its efforts to manage interest rate risk, liquidity, and profitability resulted in divisionally siloed solutions: a clear vulnerability as it entered a more uncertain period for economic growth and interest rates.
Finance & Treasury