HB Falkena and DT Llewellyn

A publication to assist bank executives and others in the formulation of strategy in the rapidly changing banking environment. Trends in, and pressures facing the banking industry are discussed.
In South Africa the regulatory authorities have three ultimate objectives, namely (i) to ensure a safe and sound financial system; (ii) to enhance the confidence of and fairness to investors; and (iii) to ensure an efficient and effective financial system. The ultimate objectives of the regulatory authorities must also be those of the financial services industry. Accordingly, financial institutions must aim ultimately for “safety and soundness”, “client confidence” and “efficiency and effectiveness”. The strategies adopted by banks have to be consistent with the objectives set by the regulator. Even if the priorities among the ultimate objectives of the bank and the regulator may be different, behaviour of the former must be consistent with the objectives of the latter. At the strategic level, the firm needs to build the regulatory policy instruments into its business planning process in a holistic, integrated manner. 

The whole book (520KB) is available for  downloading in PDF format

Contents 

Chapter 1: An integrated target-instrument approach for the financial services industry (available for download and review in Acrobat PDF format, 90KB)
1. Introduction
2. The strategy paradigm
3. The ultimate objectives of the financial services industry 
4. Intermediate targets (or indicators)
5. The alignment of instruments to intermediate targets
6. Conclusion 

Chapter 2: Instruments used to enhance the robustness of banks
1. Introduction
2. Global trends aiming to improve the robustness of banks
3. Efforts to improve the robustness of the South African financial system

Chapter 3: Instruments used by banks to enhance the confidence of and fairness to investors
1. Introduction
2. Conduct of business regulation
3. Wholesale versus retail business
4. Client compensation schemes
5. Business instruments for consumer protection
6. Efforts to improve the confidence of and fairness to investors in South Africa

Chapter 4: Instruments used to enhance the efficiency and effectiveness of banks 
1. Introduction 
2. Global trends aiming to improve the efficiency and effectiveness of banks 

Chapter 5: Defensive and offensive strategies in banking 
1. Introduction
2. The “secular pressure / strategic response” matrix
3. Secular pressures facing the banking industry 
4. Secular pressures and the defensive counterstrategies of banks 
5. Secular pressures and the offensive counterstrategies of banks