The universal bank: quest for synergy
Article Abstract:
Royal Bank of Canada's progress in creating a universal bank seems to prove that it is possible to integrate traditionally segregated financial services operations in ways that maximize value for both customers and shareholders. The bank's Wealth Management subsidiary, which combines private banking, mutual funds, trust and discount brokerage operations, posted a 25% revenue growth and an impressive 50% return on equity in FY 1996. Given such success, it is not surprising that US banks strongly support regulatory and legislative efforts to relax the restrictions separating the banking, insurance and securities industries. However, Royal Bank Chmn and CEO John Cleghorn warns US banks that entering the universal banking business involves more than just establishing a financial services conglomerate. He says it requires harmonizing cultures, operations and delivery systems without alienating employees and customers.
Publication Name: Banking Strategies
Subject: Business
ISSN: 1091-6385
Year: 1997
User Contributions:
Comment about this article or add new information about this topic:
The road less taken
Article Abstract:
Eugene Miller, Chmn and CEO of Comerica Inc, is taking a different approach to making the bank more competitive. While other banks are entering into mega-mergers to gain a competitive advantage, Detroit, MI-based Comerica is vigorously pursuing middle market and small business lending while enhancing operations and financial controls. This contrarian strategy is already paying big dividends for the company, which has better efficiency, credit quality, profitability and core growth than some of its larger competitors. Miller rejects the notion that only big banking institutions will survive in a new era characterized by mega-mergers. Colossal bank mergers, according to Miller, are only a means of achieving greater market penetration and are therefore not based on solid fundamentals. Miller, however, is not saying that Comerica will no longer pursue further acquisitions.
Publication Name: Banking Strategies
Subject: Business
ISSN: 1091-6385
Year: 1998
User Contributions:
Comment about this article or add new information about this topic:
Risk vs. reward: tilting out of balance?
Article Abstract:
The banking industry is currently enjoying strong earnings and an excellent credit quality amid a healthy national economy. However, Tanya Azarchs, director of financial institutions research at Standard & Poor's Ratings Services, warns bankers that the industry is making itself vulnerable to the next recession. She foresees that banks may face either a series of downgrades in the future as they get hit with the credit trend or a shortage of money to spend on technologies, rendering them less competitive and efficient. Azarchs advises the industry to maintain high capital and reserve ratios and be cautious of overheated lending sectors where risks are more likely to overwhelm returns. Bank senior managers, on the other hand, must always remember the lessons taught by the last credit cycle and try to shape their policies around this experience.
Publication Name: Banking Strategies
Subject: Business
ISSN: 1091-6385
Year: 1997
User Contributions:
Comment about this article or add new information about this topic:
- Abstracts: Insiders signal a time for caution. The view from Dow 4400. A word about the current rate of insider sales
- Abstracts: The First Ireland Investment Company. Tigers eat their tails. Threadneedle blazes the OEIC trail
- Abstracts: The strange allure of January. A cheap market. Tough times
- Abstracts: Small business banking: set strategy or face atrophy. Whither debit cards? Viva la revolucion
- Abstracts: Checks at a crossroads. Lines of defense. Channel harmonics