RM Model for Retail, SME and Corporate Customers

PROPOSAL ON RM MODEL FOR

RETAIL AND SME
&
CORPORATE CUSTOMERS

April, 2021

Contents
1. Introduction.............................................................................................................................................................. 1
2. Objective.................................................................................................................................................................. 2
3. Specific Objectives.................................................................................................................................................... 2
4. scope of the proposal................................................................................................................................................. 2
 RM Model for Retail, SME and Corporate Customers
5. Methdology.............................................................................................................................................................. 3
6. Customer Relationship management Model................................................................................................................. 3
6.1. creating good customer relationship management (CRM).........................................................................................4
6.2. Introducing CRM Model for retail and SME banking:..............................................................................................5
7. Relationship Mangment Models of other banks............................................................................................................7
7.1. AB /Awash Bank/................................................................................................................................................. 7
7.1.1. AB and its Retail and SME Business Model/...........................................................................................................7
7.1.2. AB and its WHOLESALE BANKING business Model............................................................................................9
1.1. Dashen Bank...................................................................................................................................................... 10
1.1.1. Retail and SME Banking..................................................................................................................................... 10
1.1.2. Crporate Banking................................................................................................................................................ 11
1.2. WegageN Bank S.C............................................................................................................................................ 12
1.3. Bank of Abyssinia............................................................................................................................................... 13
2. RM model comparison among other private banks.....................................................................................................14
3. RM Engagment criteria............................................................................................................................................ 15
4. REcommendation and conclusion.............................................................................................................................15
4.1. Proposed RM Model for high end retail and SME customers..................................................................................15
4.2. RM model for corporate customers.......................................................................................................................17
4.2.1. General Background........................................................................................................................................... 17
4.2.2. Proposed change on Corporate RM Model............................................................................................................19
4.2.3. Role and responsibility of RMs............................................................................................................................ 20
4.2.4. Role and responsibility of Relationship Officers....................................................................................................22
4.2.5. Role and responsibility of Security administrator...................................................................................................23
RM Model for Retail, SME and Corporate Customers

Abstract

Following the implementation of the bank’s 3rd corporate strategic document, NIB is
destined to be the leading commercial bank of Ethiopia by the end of the plan period.
With the aim of accomplishing this objective, the corporate strategic document is also
structured downwards from the five pillars to the specific tasks and activities to be
performed by each work unit of the Bank. Among these, Pillar II- Customer Experience
Excellence and Pillar IV-Operations and technology Excellence were designed to include
activities of enhancing the existing customer relationship model and formulation of a
hybrid structure for centralizing key processes of the Bank. The majority of the activities
under the latter have already been executed with in the plan period including the
centralization of credit activities either at District or HO level as per the Target
Operating Model/TOM/.
Customer segmentation and value prepositions being at the final stage of their
implementation, with the direction of EMC V/P-Customers and Channel has formulated
a team to come up with a proposal of placing a relationship management model for
Retail and SME Customers, and re-designing the Bank’s Corporate Banking model. As
such, the team has gone through best practices of other banks and the model placed so as
to integrate it with the existing way of doing business to come up with workable
recommendations.
After thoroughly looking in to the existing relationship management model of the Bank,
its target operating model and having benchmarked best practices of peer banks, the
study suggested that a relationship management model shall be placed at District Offices
for high value Retail and SME customers which shall further extend to all credit
customers falling above the jurisdiction of District offices.
As per the proposal, Retail & SME Relationship Mangers will be placed at the District
Offices and report to the District Manager. However; the study clearly outlines
conditions that shall be fulfilled for the effective implementation of the model as detail
outlined under.
The study also suggests centralizing Corporate Banking Services by restructuring the
responsible unit in a manner that enables it to provide end to end service to prospective
RM Model for Retail, SME and Corporate Customers

corporate customers. The restructuring takes into account practical challenges faced in
the prevailing workflow and corporate banking strategic goals the Bank aspires to
achieve by the end of the plan period.
 RM Model for Retail, SME and Corporate Customers

1. INTRODUCTION

Customer relationship management is one of the strategies to manage customer and

understanding them as individuals instead of as part of a group. This thinking has grown for
years giving customers the free will of choosing a bank based on the provision of services
tailored to their need and the values embedded within.
Due to the fierce competition in the banking sector, where the competitive struggle to win larger
market share and attract the largest possible number of customers is constantly observed, and
taking into account poorly differentiated offer of banks, adequate customer relationship
management is a fundamental tool to achieve better business results.

Unlike old times present day banks have greater scope and wider opportunities to serve their
customers in the best possible manner. The technological advancements and the understanding of
customers as the makers and creators of businesses have geared banking business in to a whole
new era. Nowadays banks are more concerned about maintaining existing customers rather than
acquiring new ones. This revolution in Customer Relationship Management (CRM) is considered
as the new “mantra” of marketing. Originally, marketers were concentrating more on acquiring
new customers for the products and services offered by them. This was made possible through
huge investment on advertising and sales promotion activities. But, there is a paradigm shift from
customer acquisition to customer retention. The focus is shifted from acquiring new customers to
retaining the existing ones as relationship marketing through a well-treated and satisfied
customer would highly benefit the bank in acquiring new customers without the need to go
through all the troubles resulting in huge marketing expenditures.
Following the implementation of the 3rd corporate strategic document NIB’s customers are
classified as Corporate, Retail, SME and IFB customers. The corresponding TOM of the bank
also dictates the centralization of some critical banking operations at the Head Office and District
level. In lieu of the above this document is prepared with the intention of proposing a workable
relationship management model for high end Retail and SME Customers and a introducing new
process model to the Bank’s Corporate Banking Department.

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 RM Model for Retail, SME and Corporate Customers

2. OBJECTIVE

This proposal has an objective of pursuing the strategic direction of the Bank to centralize critical
operations at HO and District level with the aim of increasing the value generated from high end
customers, Bank’s profitability and customer loyalty through formulating and implementing new
customer relationship management model for High end Retail and SME customers and redesigning the
prevailing model for Corporate Customers.

3. SPECIFIC OBJECTIVES

 Propose a workable relationship management model for high end Retail and SME Customers;
 Propose a single point of contact for high end Retail and SME customers;
 Revise the workflow in a manner that insures single point of contact for Corporate customers;
 To Instill a swift communication as well as administration route for high end Retail, SME and
Corporate customers;
 To instill efficient operational security and good technique of assuring asset quality through an
integrated and closely watched operational environment.

4. SCOPE OF THE PROPOSAL

The proposed new and revised Relationship Management models are to be applicable on selected
high end Retail, SME and Corporate Customers of Nib International Bank S.C in any of their
dealings with the Bank.

5. METHDOLOGY

The document employed both primary and secondary data. As a primary data RMs currently
working at other banks was interviewed to get a glance of their current practice, while written
materials on relationship management models of both local and international banks were taken as
a secondary data in formulating this proposal.

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 RM Model for Retail, SME and Corporate Customers

6. CUSTOMER RELATIONSHIP MANAGEMENT MODEL

Customer relationship management refers to the art of managing good customer relationships
and prospective customers. It is all about understanding who your customers and potential
customers are, and nurturing the relationships you have with them. It is about identifying
customer expectations and how you meet or go beyond their expectations.
A customer relationship model seeks to improve the relationship between a business and the
customer. For this, they drive new trends and provide profits for current and future operations
and investments.

Customer relationship usually has the below listed stages of development

Awareness It is the first touch point where prospects try to know more about a certain brand
as a whole.
Discovery  Then you learn and identify the needs of the prospects and share information to
fulfill their requirements.
Evaluation  Moving ahead the prospects compares and evaluates your products/services with
your competitors.
Intent  Finally your prospect is convinced and made a decision of buying from you.
Purchase  After making the payment the deal is done and the prospect converts into your
customer.

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 RM Model for Retail, SME and Corporate Customers

Loyalty  Make a follow-up after purchase to determine customer success with your product
and ask for referrals. 

6.1. CREATING GOOD CUSTOMER RELATIONSHIP MANAGEMENT (CRM)

Customers are the heartbeat of all businesses. Therefore, creating good customer relationships is
crucial for business success. Through good and bad times, maintaining a healthy customer
relationship with all your customers will help in sustaining the performance of your business. 
This reason is making/forcing businesses to develop an excellent customer relationship for
maintaining good performance. Developing good CRM and marketing helps your business to set
better customer relationship management examples. 
Developing good customer relationship management:
 Results in good customer experience – CRM is about creating relationships with your
customers so that, they enjoy positive experiences when interacting with your brand.
 Results in the growth of customer retention rates – Positive experiences fuels
customer retention. Your customers are loyal towards your brand and turn as brand
advocates.
 Results in high level of customer satisfaction – When you meet your customer
expectations with your exceptional service it boosts satisfaction level and they are likely
to return to your business again.

6.2. INTRODUCING CRM MODEL FOR RETAIL AND SME BANKING:

The growth of retail and SME banking is expected to be an important milestone in Ethiopian
banking sector development. It has immense opportunities in growing countries like Ethiopia.
Following their huge economic impact on sub-Saharan countries these segments have become a
major driver in the Ethiopian financial system. Ethiopia being the 2nd largest populous country in
Africa attending to the needs and requests of the retail and SME market would play a greater role
in the economic development of the country.
According to the survey question of Africa Finance Forum Blog that asked African banks about
their focus among Multinational companies, large local companies, retail clients or SMEs, three
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 RM Model for Retail, SME and Corporate Customers

important results came out. First, SMEs are reported as the main strategic focus by 60% of
banking groups in Africa. This reflected the intensifying competition in many sub-Saharan
Africa banking markets forcing banks to move out of their comfort zone and to maintain
profitability by going after new borrowers.
Retail clients were the next most important strategic focus for banking groups in sub Saharan
Africa/SSA/ and are reported as most strategic by 30% of banking groups. This share has risen
remarkably since 2016, reflecting the growing reliance by banks on deposit financing. This rising
strategic focus on retail clients in return is resulting in a growing tendency of savers to entrust
their savings with banks. It implies an opportunity in terms of helping individuals to save and for
banks to lend more in local currency.

Retail banking is a form of mass banking in which the financial needs of individual consumers
are dealt with. All the products and services are designed and offered to satisfy the financial
needs of the individual customers, though these customers belong to different economic,
educational, cultural and social background.
Hence, the products and services offered are also varied. Throughout the world it has been felt
that main focus of the bank in the retail sector should be customer service. It is the acceptance by
the customers of the banking products and his satisfaction with the services that bring profit for
the banks in this sector. Unlike corporate banking where corporate customers have a well-
defined financial policy and projects, in retail banking the responsibility lies on the banks to
approach the customers, find out their financial needs and problems, designing the products and
services, marketing and selling the products to the satisfaction of the customers.

Studies show that Africa’s population is set to double by 2050 and with it will come a need for
widespread access to financial services. But before we get to this point, banks must tackle low
banking penetration rates within the existing population. To do this, banks need to develop new
approaches and new ways of connecting with their customers, creating sustainable business
models that improve financial inclusion, help them to connect with new market segments,
improve their reach and keep costs down.
Even though it will be neither economical nor wise to assign a personal banker or relationship
manager for all retail and SME customers, managing the relationships of selected high end retail

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 RM Model for Retail, SME and Corporate Customers

and SME customers through a dedicated personal banker would highly benefit the bank in
various perspectives.
Managing the SME/Retail client relationship, allow banks to move beyond lending to better
capture the SME Banking opportunity. Customer management is a broad concept that essentially
covers: (1) understanding customer needs; (2) matching customer needs to the best offers in
terms of price, product, service level, and delivery channel; and (3) effectively managing the
critical moments during the customer life cycle.
Most of the banks in emerging markets servicing the SME/Retail segment are not fully capturing
the segments opportunity partly due to lack of the necessary capabilities to manage these
customers. Better customer management has been shown to directly affect the profitability of
banking institutions. This might involve improving segmentation and acquisition, actively cross-
selling and up-selling, identifying and retaining retail and SME clients, or improving collection
practices.
According to the International Finance Corporation, small and medium-sized enterprises (SMEs)
make up 99% of the 125 million companies in the world, and these SMEs contribute a staggering
49% of global GDP.
Despite the market size, banks are missing this opportunity as they are not properly addressing
this highly lucrative and accessible market.

7. RELATIONSHIP MANGMENT MODELS OF OTHER BANKS

7.1. AB /AWASH BANK/

Customers of AIB

Retail Customer
Wholesale (Enterprise
(Individual/personal)
Customer and SME customers

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 RM Model for Retail, SME and Corporate Customers

7.1.1. AB AND ITS RETAIL AND SME BUSINESS MODEL/

Retail and SME banking wing is led by Chief which is equivalent to our bank’s VP post.
The incumbent has four departments under his/her supervision and these are: -
 Regions/in our case District offices
 Small and Medium Banking Department (having 10 RMs)
 Personal Banking Department
 RMs around nine in numbers
 Branch operation on Division level
 E-Banking Department

Each department’s role and responsibilities are briefly explained below: -

7.1.1.1. Regions/District offices

The major responsibility of this wing is supervising branches under its respective geographical
areas. Have a loan discretion limit up to 5 million and FCY allocation authority for importers and
approves travel allowances for oversees travelers.

7.1.1.2. SME Banking Department

This wing has around 10 RMs who are responsible for more than 90 Customers each. Theses
RMs have the responsibility of forwarding loan request of customers to Analysis Department for
approval within the range of 5 to 25 million which now has been revised to 10 to 30 million, by
conducting due diligence.
Each RMs has own budgets for Deposit, Loan, Number of customers, times of customer visit,
Referral marketing to personal & corporate wings.
The other main task entrusted for this wing is to search for potential Embassies, NGOs, Micro
Finance institutions & Tour and travel companies and recruit the same as per the pre-established
budget set for each customer type. Each RMs are the first contact point for their assigned
customers request related to FCY, loan & any support from the bank. Apart from this RMs are
also required to give timely reply for requests of their assigned customer by contacting
concerned organs of the bank.

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 RM Model for Retail, SME and Corporate Customers

7.1.1.3. Personal Banking Department

Individuals with an annual average deposit balance of above birr 1 million/ monthly salary of
birr 90,000.00 and above are given especial attention by this department. Diasporas, Expats,
Pilots, Company CEOs, NGO Directors, individuals having regular dividend payments are some
of the individual or personal customers classified as high Net worth individuals (HNIs).
Requests of consumer loans, mortgage loans, vehicle purchase loans, Travel allowances,
children tuition fees, Medical payments in FCY are handled by this department. Each HNI
his/her own RMs in the Department as a single point of contact in every dealing with the bank.
The other group called Ultra net worth individuals (UNI) who have huge annual income than
HNIs will get bank’s special personal services at their convenience, transport service to and from
Airport when they have business travels in addition to the privileges given to HNIs.
Currently the department has more than 9 RMs and each RM is responsible for 125 HNIs.
As SME Banking RMs, personal RMs has their own budgets for number of customers, loan,
regular visit program, referral marketing, and collaborating in marketing campaigns with
branches.
This wing also conducts due diligence for personal loan requests between 5m to25 million.

7.1.1.4. Branch operation Division

This wing is responsible for branch expansion and other activities but not responsible for
resource mobilization.
7.1.1.5. E-Banking Department

This department exclusively works related to electronic payment and agent banking related
activities.

7.1.2. AB AND ITS WHOLESALE BANKING BUSINESS MODEL

The Awash Bank’s wholesale banking is led by Chief Wholesale Banking Officer at a Vice
president capacity. Under the chief’s office, there are two departments
 Corporate Banking Department,

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 RM Model for Retail, SME and Corporate Customers

 Business Banking Department,

Under each Department, there are Relationship Managers who are responsible with providing
services to customers. RMs in Business Banking Department handles customers with loan and
advances of more than Birr 30 million up to 70 million, while RMs in Corporate Banking
Department handle loan and advances above Birr 70
Administration of files and disbursement of loans processed at the two Departments is handled at
a separate division, Credit Documentation & Disbursement. The unit is responsible with
preparation of loan contracts, registration, loan as well as security document filing, and
disbursement of loans.

1.1. DASHEN BANK

1.1.1. RETAIL AND SME BANKING

Chief Retail and SME

Banking

District offices/Directors/

All Branches

Retail customers are individual customers (no legal entity) who make use of individual services
of the bank and personal loans. This are classified in to the following categories based on their
disposable income:

Customer Classification Disposable income/month

HNW/Super rich individuals >Birr 100,000.00
Upper affluent individual customers Birr 50,000- Birr 100,000
Mass affluent customers and Birr 25- Birr 50,000
Mass Market <Birr 25,000.00

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 RM Model for Retail, SME and Corporate Customers

Diaspora Ethiopian Diaspora

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 RM Model for Retail, SME and Corporate Customers

MSMEs are classified as followed:

Category Total Capital Total Asset A/Turnover/Loan

Exposure
Micro <Birr 100,000 <Birr 500,000 <Birr 1.5 million
Small Birr 100,000- Birr 1.5 Birr 500,000- Birr 3.5M Birr 1.5M-Birr 5M
M
Medium Birr 1.5M- Birr 3.5M Birr 3.5M-Birr 5M Birr 5M- Birr 15 M

District offices:

 District offices have the authority of approving all loans to the extent of Birr
15,000,000.00/except export loans/
 For all loans above Birr 10,000,000 the chief Retail and MSME Banking will participate
as a loan committee member.
 Retail and SME Head compatible with corporate RM at district level acts as a committee
member

Branches:

 Branches have the responsibility of completing due diligence for all loans to the extent of
Birr 15,000,000.00 except export loans which is treated at HO under corporate baking.
 RM is assigned for the above purpose and the RM with the Branch Manager have
responsibility of recruiting potential customers to the branch;
 No loan sanctioning limit at the branch

1.1.2. CRPORATE BANKING

The Corporate Banking wing is led by a Chief Corporate Baking Officer. There are three
departments under him:

 Corporate Banking Department – DTS Sector,

 Corporate Banking Department – GA, NGO & Int. Trade Sector,
 Corporate Banking Department – Mfg & Agriculture Sector,

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 RM Model for Retail, SME and Corporate Customers

Each Department is responsible with handling respective corporate clients’ loan requests of more
than Birr 30 million. The Departments have pool of RMs and ROs working under the RMs. The
relationship managers recruit potential customers, negotiate terms with customers, serve as a
contact person, manage contracts and authorize disbursements. ROs, under the RMs, maintain
documentation, conduct clerical works, maintain records, prepare reports, and assist RMs in
credit management.

1.2. WEGAGEN BANK S.C

At wegagaen Bank S.C customers are classified in to;

 Corporate
 Commercial customers and
 Retail customers
The above classification is made based on a weighted score calculated on aggregate result
of customers’ sales turnover, credit exposure with the bank, income generated from the
customer and customer credit risk grade.

Same way as the Relationship managers in our bank an RM at Wegagen Bank is solely
responsible to loan and advances matters only.

All credit affairs are centralized at head office and district level. Currently District offices have
the mandate of approving loan and advance requests of Birr 10 million and below while any loan
and advance requests above Birr 10 million is approved at Head Office.

District offices have a mandate to approve FCY for traveling purpose and they can also transfer
staffs with in the district.

Branches have no mandate on loans and advances except making follow up on proper
repayments.

As of now the bank has around 16 RMs at head office and three RMs per District who attends to
loan requests of customers. All creditors of the bank are attended through a relationship manager.
Contract signage, registration, loan disbursement and security handlings are currently being done

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 RM Model for Retail, SME and Corporate Customers

at Head office and District level. All RMs have one officer under for this purpose as well.
Currently a single RM attends to about 40-45 customers at Head office.

The bank is currently undergoing through a study to change the credit value curve under each
category and the responsibility of the RMS.

1.3. BANK OF ABYSSINIA

At BOA RMs are assigned only for credit customers classified based on their loan exposure.

Loan and advance facilities to the extent of Birr 5 million are assigned to be the discretionary
lending limit of District offices. All loan and advances above 5 million are dealt with Credit
Management Department at head office.

The bank classifies its credit customers as commercial credit customers (customers with a loan
exposure up to birr 50 million) and Corporate Credit Customers (loan exposure limit above Birr
50 million)

Due to the restructuring being undertaken and the shortage of man power, currently an RM
administrates and follows up to 100 customers.

Relationship Managers are also assigned to credit customers at District office and the office has a
discretionary lending limit up to Birr 5,000,000.00.

Credit Management Department:

F Makes due diligences;

F Serves as a single point of contact;
F Signs and registers contracts;
F Holds security documents and loan files;
F Disburses loans and undertakes all the credit administration tasks at head office.

Credit Appraisal Department:

This Department appraises credit files forwarded from the credit management Department.

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 RM Model for Retail, SME and Corporate Customers

Branches:

Branches are tasked with the responsibility of resource mobilization and other operational
matters outside credit matters.

2. RM MODEL COMPARISON AMONG OTHER PRIVATE BANKS

Banks customers RMS Budget

AB  Wholesale enterprise At HO and District(For loans Deposit, Loan,

customers less than 10 m they are more Number of
like analysts) customers, times
 Retail Customer of customer visit,
(Individual/personal) and SME Referral
customers marketing to
personal &
corporate wings.
DB  Corporate At Ho, District Loan and
advances, Deposit,
 SME FCY and ABC.
 Retail
 MSME
WB  Corporate At HO and Districts Portion of Total
loan budget will
 Commercial and be cascaded down
 Retail to Rms, but there
is no strict follow-
up
BOA  Corporate credit At Ho No budget
 Commercial credit

3. RM ENGAGMENT CRITERIA

Value preposition being a unique sentiment to be given to selected and priority customers only, ,
RMs are only assigned to corporate Customers and the newly proposed RM model is to be
applied to the list of high end Retail and SME customers satisfying the under listed criteria;

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 RM Model for Retail, SME and Corporate Customers

 Retail and SME Customers with an average yearly deposit balance ranging from 10-20
million;
 Retail and SME customers with a foreign currency generating capacity of USD 300,000
to USD 700,000.00/annum
 Retail and SME customers with an outstanding loan of above Birr 5 million and less or
equal to Birr 20 million.
 Corporate customers with an outstanding or new loan request of above Birr 20 million,
 Corporate customers with a foreign currency generating capacity above USD 700/annum
or any currency equivalent to it;
 Corporate customer with an average annual Deposit balance above Birr 20 million

4. RECOMMENDATION AND CONCLUSION

4.1. PROPOSED RM MODEL FOR HIGH END RETAIL AND SME

CUSTOMERS

With the aim of filling current practice gaps, in lieu of the Bank’s target operating model and
benchmarking the practices of peer banks, the team has proposed the below captioned RM
Model for high end Retail and SME customers of the bank.

Without the need to make a major structural change, the bank may assign Retail and SME
Relationship Manager who reports to the District Manager at the District Office.

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RM Model for Retail, SME and Corporate Customers

Director -Retail and SME

Banking Department

District Office

Retail and
SME RM (Job
Grade XII)

Customer
Relationship
Officer

Taking in to consideration the number of customers being entertained by a single RM at

corporate banking Department and other banks as well and the magnitude of operation
we recommend that an RM shall undertake 70 customers to be the advisor and the single
line of contact for each in their dealings with the bank. Hence the proposed proportion
shall be 1:70 (one CRM to 70 customers) and it shall be changed as it is deemed
necessary.
The number of RMs to be assigned per District Offices shall be based on the number of
customers falling under the mentioned category;
For the time being all the clerical tasks like contract preparation, collateral registration,
loan creation and disbursements, collateral/security document maintenance/, and loan
administration etc shall be handled by the respective branches.
In addition to the RMs Branches should have a role of following up repayments and
recruiting potential customers;
The proposed RM model for retail and SME Customers would look like;

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 RM Model for Retail, SME and Corporate Customers

RMs to be Responsible for but not

Customers assigned limited Budget
High End Retail and At District Offices Centrally manage customer Loan and
SME Customers relationships, prepare Due advances, Deposit,
diligence for each loan request FCY and ABC.
and actively follow up the affairs
of customers as a single point of
contact

4.2. RM MODEL FOR CORPORATE CUSTOMERS

4.2.1. GENERAL BACKGROUND

It has been more than eight years since the Bank adopted customer relationship management
concepts in one of its core operational functions. The concept was adopted at the time as it was
found mandatory to have advanced banking product retailing system that completely transforms
the prevailing working system so that the Bank stays competitive and achieve strategic goals in
the modern dynamic business environment.

Consequently, the Bank established Customer Relationship Management Department in 2013,

and started exercising the principles on customers designated based on, in retrospect, a rather
narrow segmentation criterion. The unit was formulated with a limited resource at the time and
was expected to grow in time and ultimately become a unit that serves as a single point of
contact to corporate customers, providing end-to-end banking service by employing, not only
proven CRM principles, but also latest technologies.

The limited effort made till now affirmed that having a clearly identified work process flow that
specifically target high value clients is highly essential to develop a customer-friendly system,
short waiting/delivery time and efficient use of the Bank’s human and time resources, that brings
about customer satisfaction, customer retention, better market share and brand image.

However, as time goes by, due to various reasons, the department was not able to graduate to its
aspired level. Hence, the Bank was not able to fully reap the benefits the business model could
generate. The basic practical shortcomings encountered by the Bank after the adoption of the

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CRM concept emanate from its limited scope in the adoption of the concept, constricted capacity
of the established unit and limited IT support.

a. Limited scope is evidenced in;

 Narrow segmentation criteria, that fully exclude those high value clients, like big
depositors, non-borrower exporters, high investment companies and other strategic
partners,
 Practically, the responsibility bestowed on the unit does not insure single point of contact
for corporate customers. Customers still are required to interact with branch offices as
credit files as well as loan accounts are administered there,
b. Constricted capacity emanates from;
 The thin organizational structure of the department, which includes pool of few
relationship managers, with no organizational hierarchy, differentiation of expertise and
support/auxiliary team/system,
 Limited resource, in manpower and working space, which indirectly limits the scope and
effectiveness of their involvement in the work flow,
c. Limited IT support is shown in essentially inexistent system support to assist the effort of the
department in the identification, recruiting, processing, follow-up, up-selling and cross
selling of products to corporate customers.

These factors have crippled the effort towards building an end-to-end customer service for the
segregated high value market segment. As a result re-designing the corporate banking process is
essential to bring about structural change and attain strategic targets.

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RM Model for Retail, SME and Corporate Customers
4.2.2. PROPOSED CHANGE ON CORPORATE RM MODEL

Director -Corporate
Banking Department

Corporate Security
RMs Administrator

Relationship
Officers

Taking in to consideration past experience and planned targets, a single corporate RM

shall be assigned to 50 corporate customers. The RM will be the advisor and the single
point of contact for each in their dealings with the Bank. The ratio shall be subject for
revision when deemed necessary,
The number of RMs to be assigned at CBD shall be determined based on the number of
existing as well as planned customers falling under the mentioned category;
All the activities related with loan and advances starting from the receipt of loan request
to its settlement shall be centrally handled at CBD. However; approved loan shall be
disbursed at the home branch of the customer. To this end, branches have a role in
following-up repayments and recruiting potential customers,
Customers may send their request through their home branch or directly to CBD via their
respective RMs,

Each RM shall have a budget of loan portfolio, Deposit and FCY,

RMs are expected to develop and maintain up to date knowledge of financial industry,
economy, market conditions, rates, vendors, competitions, among others. They should

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 RM Model for Retail, SME and Corporate Customers

treat people with respect; keep commitments; inspire the trust of others; work ethically
with integrity; uphold organizational values; accept responsibility for own actions;

The proposed revision on the RM model for Corporate Customers looks like;
RMs to be RMs are responsible for but
Customers assigned not limited to Budget
Corporate Customers At Head office, Centrally maintain and manage Loan and
Corporate Banking security documents, manage advances, Deposit,

Department customer relationships, centrally FCY and ABC.

handle contract preparation,
registration and loan
disbursements, actively follow
up all the affairs of customers as
a single point of contact,

4.2.3. ROLE AND RESPONSIBILITY OF RMS

Role and responsibility of RMs shall include but not be limited to;

Each RM shall have a budget of loan amount, Deposit and FCY,

Be a business advisor and problem solver to customers;

Build long-term relationships with customers;

Work quickly to address and resolve customer issues;

Become familiar with the competition to stay ahead of them;

Create strategies and closely work with customers to boost the Bank’s brand;

Help promote and maintain a positive company image with in the society;

Create and enforce plans that will help meet the needs of customers;

Encourage high-sales and good customer service practices;

Notify the sales team of new sales and cross-selling opportunities;

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RM Model for Retail, SME and Corporate Customers

Engage in business development activities and solicitation of new business; be actively

involved in instilling and maintaining a positive sales environment through education of
the Bank’s products and services;

Interview prospective applicants and requests specified information related to loan or

credit application; correspond or re-interview applicants to resolve questions regarding
application information;

Perform prequalification assessment and overview of financial condition and risk of

financing requests within the framework of the Bank’s credit culture and current
economic and industry trends;

Gather and analyze all information necessary to present a financing request to Senior
Management or Loan Committee for approval; meet with existing or potential customers;
visiting sites of loans; negotiate loan terms and conditions with customers, and refers or
comes up with proposals for decision;

Ensures that individual loans are risk rated correctly;

Avail himself/herself as a resource person before loan sanctioning committees,

Ensure that credit inquires and all mandatory filings are researched to determine credit
worthiness and appropriate collateral positioning are achieved;

Coordinate processing of approved loans; ensure loans are processed according to

agreement, customer needs and conform to Bank lending policies; obtain sufficient
information and/or documentation from customers; solve problems relative to processing
and servicing of loans within his or her portfolio; forward loan disbursement requests to
the concerned organ in accordance with agreements;

Attempts to ensure that individual loans are risk rated correctly when reviewing loans for
loan committee submission;

Ensure that registration or release of collateral is made by the appropriate organ;

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RM Model for Retail, SME and Corporate Customers

Ensures that appropriate insurance policies are maintained on loans and/or collaterals
held to secure loans at all times,

Underwrites and processes renewals of credit facilities;

Cross sells and up sells the Bank's other products and services;

Respond to inquiries, problems and complaints of corporate customers, and follow

through customer issues until they are fully resolved;

Timely and periodically recognizes appropriate interest incomes on loans and advances
when they are earned and/or paid;

4.2.4. ROLE AND RESPONSIBILITY OF RELATIONSHIP OFFICERS

Assists RMs in;

 The verification of credit references and other information regarding loan

applications;
 Extracting pertinent data from customers credit application and
documentation;
 Collection and construction of base line data for the preparation of due
diligence/KYC reports on customers;
 Preparation of standard loan approval forms, entry slips and vouchers related
to loans;
 Preparation of loan and mortgage contracts and guarantee instruments in
compliance with the provisions of approved credit facilities;
 Verification of proper registration of all securities offered as collateral at the
proper governmental registrar body as well as payment of stamp duty charges;
 Checking that appropriate insurance policies are maintained on loans and/or
collaterals held to secure loans at all times,
 Keeping, reviewing and updating loan files regularly;
 Follow up of the timely collection of loan repayments and, renewal or
otherwise of overdraft or other revolving facilities;
 Providing & collection of credit information as required;

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RM Model for Retail, SME and Corporate Customers

 Preparation of periodic loan reports & returns;

 Performs other related duties as required.

4.2.5. ROLE AND RESPONSIBILITY OF SECURITY ADMINISTRATOR

Ensures that signed loan, guarantee, mortgage or other contracts are complete and within
terms in accordance with approval conditions,

Arranges for and ensures the proper registration of all securities offered as collateral at
the proper governmental registrar body and payment of stamp duty charges finalized, if
necessary;

Ensures that all loans handled have proper hazard/risk insurance and follow-up for timely
inform responsible organs for renewal of insurance policies;

Keeps custody of stock of flat rate revenue stamps;

Ensures that all security documents are collected based on approval terms and are kept
confidentially in a safe custody,

Ensures that all contracts are in line with their statutory period requirements and timely
demand responsible organs for re-signing, if necessary,

Provide information regarding security documents to authorized organs when requested,

Prepares periodic reports, about the securities at hand.

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