Topic 13. Banking policy (BP) and the scope of its implementation

BP - a set of goals, the basic concept of the functioning of the bank. The main questions that banking policy should answer are: "why" - general targets, in the name of which certain actions are taken; "what" - what actions need to be taken; "who" - organizational structures, employees; "how" - specific schemes according to which certain actions should be carried out.

BP includes: - future markets, their analysis; - should contribute to the implementation of the optimal strategy for choosing banking priorities; - a set of risks that the bank has the right to take on; appearance and image; - organizational structure.

BP elements:

1) the name of the bank (should be exclusive);

2) specialization of the bank;

3) priorities of goals (what should characterize the bank in the first place: stability, reliability);

4) slogan

5) customer orientation (which customers will be served);

6) partnerships with the client, their level;

7) powers and responsibilities of organizational structures and personnel;

8) internal control and audit;

9) hierarchy, subordination and rewards;

10) reserve policy;

11) documentation;

12) confidentiality (the degree of confidentiality of information).

BP structure: 1 - segment-credit policy, the main document that regulates it is the credit memorandum, which indicates: the size, the percentage of rates; distribution of powers to issue loans; loan limits; how credit monitoring is carried out, etc.). 2 - segment-deposit policy - develops goals and restrictions for attracting credit resources, including preferences of depositors and certain types of deposits. 3 - segment-pricing policy - determines the amount and amount of payment for the provided banking services. 4 - segment-Investment policy: includes a set and preferences of investment instruments, industries). 5 - Risk Policy: includes a list of risks that need to be analyzed; the degree of risk that the bank can assume; methods of risk management and optimization. 6 - Working with problem clients. 7 - Collateral policy: the most preferred types of reserves and their volumes. 8 - Sanctions: a set of measures applied in case of violations.

Areas of BP implementation:

1) organizational (bank departments);

2) informational (what information is needed to make management decisions);

2) economic (sources of financial support for the activities of a commercial bank and the costs of developing a BP).

Authors: Shevchuk D.A., Shevchuk V.A.

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