A commercial bank organisation
Category: Bank Management
Presentation and evolution
Because of diversity in the structures of credit institutions and in the Banking professions, it’s quite difficult to propose a simple and complete definition of what a bank is.
Just like many other companies, the organisation of a credit institution can be described in many different ways depending on how you look at it.
The examination of the organisation chart leads to the traditional approach that describes different entities: Management, Departments, Services, Branches. So, you can understand the hierarchical links between the different groups.
The modern approach through flows shows the circuit of a procedure through the different departments, up to the end user; it helps check the weak points in a circuit, in terms of control and efficiency.
In fact there is no organisation chart that could be applied to any bank for there are too many organisational or historical or personal characteristics.
Today, a good definition of a credit institution could be:
A modern bank is a combination of industrial processes designed to give the best service to customers; these processes are developed thanks to many functions and professions — The combinations, the links, the inter-connections appear in every banking organisation.
For instance, it is interesting to examine the functions used in the process of making a loan to a customer.
So, in this operation, 7 different functions of the bank have been called upon. Nevertheless, even if these links and combinations between functions are at the basis of the bank operations, it seems to be more interesting to study them one by one.
The different functions can be arranged around four major poles:
Development division totally devoted to customers whose mission is business development.
Logistics division which is a service to the other poles.
Strategy division which has to anticipate the evolution of the bank in its environment, to attribute, manage and take decisions on its resources.
Subsidiaries pole which deals with different professions, separated for juridical, financial or organisational reasons.
Diagram 2.2. Advanced organisation chart
1 Credit Policy determined by General Management
2 Level of rate to be decided by Financial Department and Commercial policy by the Marketing
Department
3 Offer of credit by the Branch
4 Analysis of credit by the Credit Risk Department
5 Register credit and process it in the accounting Department
6 Credit the account of customers and sign contract
7 Computerised processing of loan
8 Accounting of reimbursement
Diagram 2.4
