Main players of the banks are: retail divisions, small and medium companies, big companies, multinational companies, international companies, security and insurance institutions, conglomerate institutions, other banks, non financial institutions and many others. Arthur Lok Jack Graduate School of Business, The University of the West Indies, No public clipboards found for this slide. The banking area, banks are under the strong impact of current financial instability and changes are necessary in some fields. Stable customer funds, based on the application of a methodology for establishing which segments and customer balances are considered to be stable or volatile funds based on the principle of sustainability and recurrence of these funds. An organization cannot survive in the long run if its customers are not satisfied. They will stay with the organization (in our case bank) as long as they are finding satisfaction and happiness with offered products and services. Focuses on providing means by which government and institutions are able to rapidly adjust their actual liquidity position. Looking for a flexible role? The structural gap projection, as a result of assessing the funding needs generated both from the credit gap and by the securities portfolio in the banking book, together with the rest of on-balance-sheet wholesale funding needs, excluding trading portfolios. ), practically all the financial products have some exposure to movements in interest rates due to the effect of the financial discount in valuing them. Short term assets can be exchanged with cash within one calendar year. The corporate GRM area is responsible for controlling and monitoring structural interest-rate risk, acting as an independent unit to collateral that the risk management and control functions are properly segregated. It determines the amount of taxation that stockholders pay. These factors influence the productivity and profitability of business. The analysis of the entity's RWA structure shows that 3% corresponds to Market Risk. Customer satisfaction is first stage in building long term relationship with the customer. Most banks operate under a system known as fractional reserve banking where they hold only a small reserve of the funds deposited and lend out the rest for profit. Finance management is one of the important education which has been realized word wide. They are the best judges in any company. Financial management helps in anticipation of funds required for running the business. Second, Internet and Information Technology (IT) have play in last decade an important role in banking sector. Characteristics of the eligible capital, 3.1. Many times it happens that lack of skills or wrong decisions can lead to heavy losses to an organization. Slideshare uses cookies to improve functionality and performance, and to provide you with relevant advertising. Values and believes, cultures and religion’s motives serve as path to certain behavior guides and purchase culture. Scope and Nature of Planning 2. planning planning is the process of analyzing the situation, determining the goals/ objectives that will be persuaded in the future and deciding in advance, the actions that will 3. Final and most important goal to achieve from all the above mentioned is profit or so called bottom line. Customers are taking greater control of their banking relationships, and the banks that can provide more choice and flexibility will gain more control over their own destinies. Lets learn and understand about the nature and scope of financial management through the below details notes. In order to build strong sustainability and profitable company, it is necessary to build on first place strong relationship with loyal customer, they will dictate stream of profit, new product, innovations and business on long run. You can download free for “Nature of Financial Management pdf” and “Scope of Financial Management pdf” from the below link by just unlocking the social locker.