Alpen Bank

In: Business and Management

Submitted By ikass001
Words 256
Pages 2
Date: February 13, 2013
To: Alpen Bank
Subject: Alpen Bank Case

To whom it may concern:

This is to address whether or not the Romanian market holds any opportunity for Alpen Bank and our credit card services. Based on our analysis, Romania holds opportunity for us to launch our credit card services with potential for growth year after year because of a growing middle class that looks for a better standard of living. Romania’s acceptance in the e European Union should strengthen its economy. Compared to other central and eastern European countries, Romania has the least financial cards per household at 1.2 cards. With the growth that we are expecting, Romania will follow in the footsteps of its neighbors and double the amount of financial cards per household.

Alpen Bank should position itself by targeting all customers. Alpen bank has previously only targeted affluent customers as far as its banking sector. Alpen bank card services should be available to all customers with the right credentials in order to grow with the growing middle class. We predict that by targeting all customers, we provide ourselves with a larger target market. Though targeting affluent only customers seems like a better opportunity for the first two years, we are looking long term. Targeting all customers will allow us to hit our $5 million profit target with 142, 248 customers in year one and 146,788 customers in year two. These numbers can be achieved by combining direct mail, take one, FSIs, direct sales, and branch…...

Similar Documents

Alpen Bank Case Analysis

...Alpen Bank: Launching the Credit Card in Romania ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- Problem Brief ------------------------------------------------- As Alpen Bank’s country manager for Romania, Gregory Carle was contemplating a credit card launch in Romania market, which he would pursue if he could be confident that it would add 5 million euro in annual profit to the Consumer Bank Segment within two years. ------------------------------------------------- Alpen Bank had developed a reputation for excellence in serving affluent clientele. In addition to basic deposit, checking and personal loan services, customers had access to a wealth management program composed of financial planning and investment products. ------------------------------------------------- Some of the......

Words: 1176 - Pages: 5

Bank

...LESSON 14: CASH BOOK, PASS BOOK, BANK RECONCILIATION STATEMENT Dr. Jyotsna Sethi, Rekha Rani STRUCTURE 14.1 Introduction 14.2 Objectives 14.3 Cash Book 14.4 Types of Cash Book 14.4.1 Simple Cash Book 14.4.2 Two Column Cash Book 14.4.3 Three Column Cash Book 14.5 Petty Cash Book. 14.5.1. Imprest System of Petty Cash Book. 14.5.2 Advantages of Petty Cash Book 14.6 Pass Book 14.7. Bank Reconciliation Statement 14.7.1 Meaning 14.7.2. Causes for difference between Cash Book Balance and Pass Book Balance. 14.7.3. Need and importance of Bank Reconciliation Statement 14.7.4 Procedure for preparation of Bank Reconciliation Statement. 14.8. 14.9. Summary Glossary 14.10. Self Assessment Questions 14.11. Answer to check your progress 14.12. Further Readings 14.1. INTRODUCTION Every entrepreneur should have knowledge of cash book and pass book as from these books, he may check how much balance is available to him for meeting his expenses and liabilities and what are the details of receipts and payments of a particular period. With the details of payments it can be checked that whether the payments are of reasonable amount or not. If the expanses are unreasonably high he may take steps to control them. An 211 entrepreneur who regularly checks his cash and bank balances would never face problems like dishonor of cheques or cash crisis etc. Entrepreneur, who doesn’t distinguish between his revenue and profits, may spend all his receipts for his personal purposes......

Words: 3838 - Pages: 16

Alpen Bank

...Carle, Alpen Bank's country manager of Romania, has one week to decide whether Alpen should launch a new credit card in the Romanian market. There are many factors to take into consideration and if it is decided to be launched, Carle also needs to decide how it should be positioned in the market. Situation Analysis Context: Alpen bank had balked at launching a credit card in Romania due to the low usage of credit cards. Transactions were based on cash, but after 2000, by the entry into European Union, the Romanian economy started to grow and disposable income increased dramatically. In 2006, total financial cards grew by 35% compare to prior year. Moreover, required infrastructure (ATMs, point-of-sale terminals) was developed significantly but still the market is underpenetrated. Customers: In Romania, there was a huge income inequality that the top 10% of households by income had almost 24% of the wealth. Credit cards are used mainly by affluent and middle class consumers. Affluent segment consists of career oriented professionals and they are not very price sensitive. On the other hand, there is a big middle class in Romania and it is growing economically. These people are a mix of young professionals and families and they are price sensitive. Also, this segment's card utilization is lower compared to affluent segment. Company: Alpen Bank has entered to Romania in 2000 and since then it is growing in the market and as of 2005 it had 15 branches in the country. The bank......

Words: 1291 - Pages: 6

Alpen Bank

...after the successful implementation of Alpen Bank in Romania in the years 2000, Gregory Carle the country manager is wondering whether Alpen Bank should consider launching a credit card in the market. In order for the launch to be profitable several points have to be clarified such as who would the company target, what would be the positioning of this new card and how should it be marketed. Situation Analysis Context: After a period of recession, the economy in Romania is on a rising trend. The total disposable income of the population has increased and the middle- and upper- middle class is developing as their income is increasing. Consumers: A consumer survey indicates a clear change in the Romanian’s behavior; they are getting more interested in luxury goods and in products coming from the EU. Also, a strong increase of total cards on the market of 35% indicated that consumers are getting more likely to use cards rather than cash. This trend is supported by the fast development of the infrastructure required for a payment system. Even though for now cards are mostly debit ones and used to withdraw cash, as the country economy is growing and the behavior of consumers changing it is very likely that credit cards have their place on the Romanian market. Another important data to consider is the income distribution in Romania which is very unequal as only 10% of the population holds 24% of the wealth. Competitors: The competitors of Alpen bank have already launched the......

Words: 1301 - Pages: 6

Bank

...United Kingdom (UK) Company named NRB Community Bank which provides international recognition and credentials for fund raising and management as well as investing in Bangladesh. NRB Community Bank will focus on providing services to the High Net Worth (HNW) clients and Small & Medium Enterprises (SME) in the UK and from Bangladesh and will carry on other regulated retail bank activities as appropriate. The NRB Community Bank will go into a partnership arrangement with an existing retail bank and offer the banking services in a “white-label” arrangement where the NRB Community Bank will market and target the community in utilizing the retail banks products and services similar to what has been done by Tesco Bank and Sainsbury’s Bank. NRB Community Bank will make all the investments and acquire the retail customers from the target community and share the revenue with the retail bank partner. NRB Community Bank will be the first Bangladeshi commercial company formed and operating in the UK under the Financial Services Authority (FSA) regulations and fully transparent and accountable to the UK companies’ laws and compliances. The primary objective of the Company will be to service to the Non Resident Bangladeshis (NRB) in the UK and Europe and invest in portfolio of projects in Bangladesh that provides significant return to the investors and shareholders. NRB Community Bank will seek to provide investment products and retail bank services to the Non Resident Bangladeshi......

Words: 842 - Pages: 4

Alpen Bank in Romania

...Alpen Bank In Romania Question 1 By taking a look at table A that is provided in the case study you can see that they created a Net revenue impact table. On it, it shows that the lowest income they are looking for in a household is €3,000, and that from €3,000-4,500 is listed as middle class. If we then look further down we see Exibit 5 witch lists the Annual income in Romania and we see that 18.2% of Romania’s population would fall into this middle class range. Now if we do the same for the group table A has listed as Affluent, €4,500-6,000, we find that 15% of the population falls into this category. And finally if we add up all the households that make over €6,000 a year, listed as most affluent, we find that 12.9% of the total population goes in this category. So it looks like only 46.1% of Romania’s total population has enough income to afford a credit card at Alpen Bank. Out of the 46.1% of the total population that can qualify for a credit card 39.5% is made up of the middle class (18.2/46.1=39.5%). Table A also lists the annual revenue that would be made from card holder in each class, and it shows that an individual in the middle class would make €60.63. So 39.5% of their credit card income would be €60.63. Using the same process we can find that the Affluent, (15/46.1=32.4%), would make up 32.4% of their income and produce €123.38 per card holder. And the most affluent would compose 28% (12.9/46.1=28%) and each card holder in this bracket would produce €209.75......

Words: 1523 - Pages: 7

Alpen Intro

...REVISED DECEMBER 18, 2012 V. KASTURI RANGAN SUNRU YONG Alpen Bank: Launching the Credit Card in Romania Introduction In September 2006, Gregory Carle sat pensively at his desk at Alpen Bank’s corporate headquarters in Zurich. The previous evening he and the senior management team had enjoyed themselves dining late above the picturesque Limmat Valley, but now it was time to focus his attention on the task at hand. As Alpen’s country manager for Romania, Carle was contemplating a credit card launch in the Romania market, which he would pursue if he could be confident that it would add €5 million of annual profit to the Consumer Bank segment within two years (see Exhibit 1 for a summary of the financial performance of the Consumer Bank segment of Alpen Bank in Romania). Carle had been with Alpen since 1992, when he joined the bank’s global marketing group. His appointment in 2000 to country manager for Romania coincided with the bank’s opening its first branch in the capital city of Bucharest. Since then, Carle had overseen the opening of 14 additional branches in Romania, with Alpen Bank developing a reputation for excellence in serving affluent clientele. In addition to basic deposit, checking, and personal loan services, customers had access to a wealth management program composed of financial planning and investment products. The idea of a credit card for Romanian consumers was not new. Historically, Alpen management had balked at launching a card business due to low...

Words: 341 - Pages: 2

Bank

...Deposit-taking institutions that accept and manage deposits and make loans, including banks, building societies, credit unions, trust companies, and mortgage loan companies; • Insurance companies and pension funds; • Brokers, underwriters and investment funds. Functions of a Financial Institution: The functions of Financial Institutions are: • Financial institutions provide service as intermediaries of the capital and debt markets. • They are responsible for transferring funds from investors to companies in need of those funds. • Financial institutions facilitate the flow of money through the economy. To do so, savings a risk brought to provide funds for loans. Such is the primary means for depository institutions to develop revenue. Should the yield curve become inverse, firms in this arena will offer additional fee-generating services including securities underwriting, and pre. Regulation Structures of Financial Institutions: Financial institutions in most countries operate in a heavily regulated environment as they are critical parts of countries' economies. Regulation structures differ in each country, but typically involve prudential regulation as well as consumer protection and market stability. Some countries have one consolidated agency that regulates all financial institutions while other have separate agencies for different types of institutions such as banks, insurance companies and brokers. Countries that have separate agencies......

Words: 15567 - Pages: 63

Bank

...local private commercial banks. Electronic banking is one of the most demanded and latest technologies in banking sector. This paper tried to unearth the present status of electronic banking in banking sector in Bangladesh. Keywords: Electronic Banking, Bank, Bangladesh Introduction: In Bangladesh, multinational banks are operating for long besides our nationalized, private and specialized banks. However, much of the resulting research has concentrated on providing evidence of the association between consumers’ usage patterns of ATMs and their demographic profiles (Hood, 1979; Murphy, 1983) and, more recently, consumer psychographic profiles (Stevens et al., 1986). Besides, the banking services of nationalized, private, and multinationals are different by quality of their services. Multinational banks are offering better services than others. They offer better customer services, personal financial services, corporate facilities, trade services with the help of efficient operational department, credit department, information technology department and the most important department is the marketing department. Presently they are thinking to offer door-to-door services, 24 hours banking services with electronic banking, pay and cash management through internet services. Moreover, waiting to introduce intensive e banking of the multinational banks in Bangladesh. Customer always demands better services, security, and round the clock banking. Multinational banks are......

Words: 3626 - Pages: 15

Alpen Bank

...ALPEN BANK CASE By 11/06/2014 TO: Gregory Carlyle FROM: XYZ RE: Alpen Bank: Recommendations for new Credit card Business in Romania DATE: 11/06/2014 Mr. Gregory Purpose: The purpose of this memo is to report my observations after careful analysis of economic opportunity of credit card business for Alpen Bank in Romania Recommendation: After thoughtful research, I would recommend you that starting a credit card business for affluent and most affluent will be more profitable. The break-even point, return of investment and profits after breaking even are all favorable for Affluent classes alone. Analysis: I have started with my analysis of customer acquisition. Keeping in mind the importance of publicity for a successful launch of credit cards from our bank, I went ahead using all the modes of publicity. After careful calculations (Seen in Exhibit 1 and 2) of customer acquisition, I came up with the cost per customer value. To begin with, the cost per customer for affluent population alone is less compared to all customers. Having decided to check the feasibility of starting the credit card business for both middle class and affluent or just for the affluent class, I calculated the weighted revenue of these classes. (Exhibits 3 and 4). It is clear that the revenue from affluent class alone is about 40 Euros higher. Then I proceeded in calculating the Net profit for a customer size of 50000, 100000 and 150000 individually for two cases.(Exhibits 5 and 6)......

Words: 402 - Pages: 2

Alpen Bank Case

...processing card transactions . C - ) Merchants , the restaurants , the retailers , gas stations etc. which accept cards . D -) Card Issuers , the banks which own the relationship with the cardholders . Revenue in the card payment industry is generated by transaction volume . A percentage of each transaction , called the ‘’ merchant discount ‘’ is taken and divided between A & B & D. B category are interested in high ‘’ per – ticket ‘’ spending , in opposite A category is interested in using the cards by customers for every purchase . D - Category can generate revenue , in addition of all , by charging annual fees , penalty fees , and interest income . 3 - ) Credit Card Positioning and Economics in ROMANIA. Income inequality was increasing in Romania , the top 10% of households by income had almost 24 % of the wealth . * ) Romania has an affluent existing customer base . The today middle class ( Exhibit 5 ) may be the affluent customers of tomorrow . Middle class credit card customers earned over 200 Euro /m , they are young professionals and families , THEY ARE MORE WILLING TO COMPROMISE AND MAKE PRICE – DRIVEN DECISIONS . Serving them means for Alpen bank perhaps lower interest income and interchange . * ) The potential customers that have at least 500 Euro/m , are career –......

Words: 1070 - Pages: 5

Alpen Bank Case Study

...DATE: Oct, 18th, 2013 CASE: ALPEN BANK CLASS: MBA586 GROUP C: CHIAWEN ‘TRACY’ CHANG CHIENYU ‘SHAWN’ HSIAO DANIEL GUTIERREZ NING ‘NINA’ BAI WENSHAN ‘NESSA’ XU Intro: Having 15 branches in Romania, Alpen Bank, a premium banking service provider is trying to expand its business in Romania and launch its credit card system. Considering the low per-capita income level and low acceptance of credit cards in Romania, we evaluated the profitability of this plan carefully and suggest Alpen Bank to enter the Romanian credit card market and explore the middle class in long run. PEST Analysis: Political • Capital market in Romania is more stable through annex to the European Union and implementation of directives. • The European Legislation to protect investors, safeguard market integrity by establishing harmonized requirements governing the activities of authorized intermediaries and to promote fair, transparent, efficient and integrated financial markets. • Substantial ascending evolution of Romanian capital market since 2004 helped by the government opening it for competition. • No limit of foreign participation in commercial companies (up to 100% ownership in Romania), full repatriation of capital and profit, equal treatment of foreign and domestic investors. Economic • Macroeconomic indicators (GDP, inflation rate, unemployment rate, etc.) registered in the past have not reached a stable point......

Words: 1831 - Pages: 8

Case Analysis for Alpen Bank

...Case Analysis: Alpen Bank The main issue that Alpen bank is facing is whether or not they should launch the credit card business in the Romania market and which group of target audience they should select while applying the launching strategy. Moreover, specifically to Carle, he needs to come up with a program from which, Alpen bank can generate at least €5 million in profit within 2 years. Moreover, clarified positioning strategy and customer segmentation is also needed to secure the success of the program. In the case, it seemed that Alpen had the opportunity to act since economic environment in Romania had changed from 2006 after its entering into the EU: the economy there was developing; a growing trends of luxury purchasing emerged; there was also an increasing likeliness of using card instead of cash; other competitors had already taken similar strategies in the market; Alpen’s traditional banking business had a great penetration throughout the country, etc. However, such a growth was not enough compared with other countries of the region. Besides, to launch the credit card business in Romania might be risky and do harm to the customer base. Then what should Alpen do? According to the charts 4 & 5 in the appendix, regardless the target audience, launching credit card business in Romania is profitable with the premise that if the customer base is big enough. (All the calculations in the charts were based on revenue potential and acquisition costs.) Comparing......

Words: 2151 - Pages: 9

Alpen Bank Romania

...1) H ow should Alpen Bank position its card? Alpen bank should position its credit card as a high end premium product as itsexisting customers belong to the affluent class and it would be easier to establishitself in this segment. Furthermore this class represents the top 10 % of population which has about 24% of wealth. They are less price sensitive andmore conscious of their image so positioning the card on high end would bebeneficial for the bank. This segment includes professionals who would like topurchase products and services through credit card considering it a statussymbol.Moreover, for countries like Romania, it is seen that credit cards are somewhat stickier as compared to the developed countries. This shows that if Alpenpositions its card as a high end product, it will gain a share of market whichwould stick to its card.The middle class also has a huge potential especially in terms of the size of market however they are more price-focused and would only welcome this newcredit card if the interest rates are low. They also have a monthly income whichsupports them to have a credit card. Based on the attitudes of customers in otheremerging economies it can be said that customers in middle-income class have alower actual utilization rate when compared with affluent class. 2 ) W hat is the cost of acquisition of customer? C ustomer acquisition cost is the cost associated with convincing a consumer tobuy your product or service, including research,......

Words: 931 - Pages: 4

Alpen Bank

...growing trend in purchasing luxury goods and increasing likeliness of using card. Although Romanian banks has already been marketing in the business, other competing banks are bullish the market (Exhibit 4) and it is hardly for them to take the same strategy in the near future. With the premise that top 10% of households by income have nearly 24% of the wealth (Exhibit 5), launching credit card business is profitable in the long term. Affluent are less price-sensitive to annual fees and are more likely to use cards with great frequency. Revenues generated by annual fees and interchange are sustainable, for affluent customers in emerging market are more sticker than in developed market. (Alpen bank should position its credit card as a high end premium product as its existing customers belong to the affluent class and it would be easier to establish itself in this segment. Furthermore this class represents the top 10 % of population which has about 24% of wealth. They are less price sensitive andmore conscious of their image so positioning the card on high end would be beneficial for the bank. This segment includes professionals who would like to purchase products and services through credit card considering it a status symbol. Moreover, for countries like Romania, it is seen that credit cards are somewhat stickier as compared to the developed countries. This shows that if Alpen positions its card as a high end product, it will gain a share of market which would stick to its......

Words: 540 - Pages: 3

U Disk GPS L1 L2 Signal Jammer USB Interface Car Shielding Device | Serie TV | Tom Lenk