In this paper, issues of banking strategy as possible contributors to bank failures in the recent financial crisis will be examined. The relevant strategic models which led to the tumbling of banks will be discussed in order to give a clear advice on how to prevent future crises. For a better understanding of this specific area, there will be at first a brief explanation of strategy in banks.
Inhaltsverzeichnis (Table of Contents)
- Introduction
- Fundamentals of banking strategy
- Strategic models as contributors to bank failures during the financial crisis
- Lessons from failing strategies
- Conclusion
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This paper aims to examine the role of banking strategy in contributing to bank failures during the recent financial crisis. It will analyze the relevant strategic models that led to these failures to provide guidance on preventing future crises. The paper will start with a brief explanation of banking strategy to provide a context for understanding the issues.
- Strategic models and their role in bank failures
- Risk management and its impact on bank stability
- The importance of core capabilities and diversification
- The consequences of aggressive growth strategies
- The role of customer relationships and competitive advantage
Zusammenfassung der Kapitel (Chapter Summaries)
- Introduction: This chapter sets the stage for the paper by outlining the focus on banking strategy as a potential contributor to bank failures during the financial crisis. It emphasizes the need to understand the relevant strategic models that led to these failures and to learn from them to prevent similar situations in the future.
- Fundamentals of banking strategy: This chapter delves into the basics of banking strategy, highlighting the crucial elements that bank managers should consider when allocating resources. The chapter emphasizes the importance of a three-dimensional matrix approach focusing on clients, products, and geographies to ensure effective resource allocation and long-term company success. It also discusses the significance of maximizing synergies, economies of scale and scope, and avoiding naive overdiversification.
- Strategic models as contributors to bank failures during the financial crisis: This chapter examines the specific areas of strategic problems that emerged during the financial crisis, such as asset quality, liquidity and funding structure, capital base and leverage, and overall risk management. The chapter analyzes the strategic decisions made by specific banks, including Lehman Brothers, German Landesbanken, Spanish cajas, and RBS, to demonstrate how their strategies contributed to their failures.
Schlüsselwörter (Keywords)
This paper focuses on banking strategy, financial crisis, bank failures, strategic models, risk management, asset quality, liquidity, capital base, leverage, diversification, customer relationships, competitive advantage, and case studies of specific banks such as Lehman Brothers, German Landesbanken, Spanish cajas, and RBS.
- Quote paper
- Arno Hetzel (Author), 2017, Strategic problems faced by banks. How to prevent future crises, Munich, GRIN Verlag, https://www.grin.com/document/379757
