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2.2. Working out of the business plan of re-structuring of bank

The bank of Russia considers re-structuring exclusively as the tool on restoration of solvency of the credit organisations whereas re-structuring possibilities are wider. In chapter 1 it was noticed, that re-structuring can be applied and financially stable organisations with a view of strengthening of the market position and the economic recession prevention.

The concept of re-structuring, thus, is much wider than the approach of Bank of Russia as it is also the effective tool of influence on growth of a commercial value of the capital of the credit organisation.

The methodological maintenance of re-structuring existing for today in the form of a number of is standard-legal documents, in our opinion, does not provide in due volume of procedure of re-structuring for its carrying out at microlevel of a banking system with forces of proprietors and creditors. Thereupon development of methodological base of re-structuring is especially significant.

With a view of increase of efficiency of process of re-structuring we consider necessary to consider re-structuring as a capital investment project demanding accordingly working out business - of the plan. Studying of plans of re-structuring of banks by us has shown their following lacks:

Insufficient security of investment appeal of the project;

Unreality of achievement of objects in view;

Absence vzaimouvjazki separate elements of the project of re-structuring and, as consequence, inconsistency of works on introduction of measures on re-structuring;

Low efficiency of re-structuring.

The important part of process of project development of re-structuring is formation of a command of the project. Its basic functions are:

Attraction of investments;

The financing organisation;

Preparation of the initially-allowing documentation;

Public relations;

Management of the project;

The financial and economic analysis;

Information-analytical maintenance.

Further it is necessary to result organizational structure of bank according to the strategy of its development developed at the previous stage.

Transformation of organizational structure is carried out on a basis:

Transformations of business of re-structured bank (including reorganisation) - changes of functional structure;

Re-structurings of a property complex - changes of physical structure.

Also the financial structure of bank which is expressed in re-structuring is subject to change in re-structuring process also:

Authorised capital;

Debts (if the last is necessary).

Thus, all listed complex of measures on bank re-structuring should find adequate reflexion in the re-structuring business plan.

With a view of perfection of process of designing of re-structuring we had been allocated its following stages:

Preparatory stage (it is in detail described in paragraph 2.1);

Formulation of the purposes, problems, working out of strategy and preliminary complex of measures on re-structuring on the basis of results of application MOPR;

Working out of the business plan of re-structuring (see the scheme 7);

Search and attraction of investors;

Updating of the project of re-structuring (if necessary);

Project introduction;

Estimation of efficiency of introduction of the project of re-structuring (on termination of the project).

The scheme 7. Process of working out of the business plan of re-structuring Business planning of process of re-structuring, in our opinion, should be based on use of the profitable approach at definition of a commercial value of re-structuring as change of a commercial value in the given situation grows out of re-structuring, and process of re-structuring - a capital investment project of development of the bank business which is carried out by means of carrying out of structural transformations, directed on increase of efficiency of its functioning.

The maintenance of the given approach are:

Competent designing of process of re-structuring (process of working out of the business plan of re-structuring see);

Use of model of the discounted monetary streams at drawing up of an accounting budget of re-structuring;

Forecasting of a commercial value of bank after re-structuring by a method of discounting of monetary streams with a view of definition of a reference point of re-structuring.

The question on structure of the business plan of re-structuring is logical also. To solve this question, we will address to experience ARKO on working out of plans of re-structuring, and also experience of drawing up of business plans by banks.

Requirements to the maintenance of plans of re-structuring have been confirmed by Board of directors ARKO Report №3 from March, 15th, 1999 According to the specified requirements the re-structuring plan should have the following structure:

The general data on the credit organisation;

The reasons of occurrence of financial obstacles;

Financial circumstances at the moment of decision-making on carrying out of actions for re-structuring;

The list and the description of actions for re-structuring.

In section «» it is necessary to specify the General data on the credit organisation following data:

The full official name of the credit organisation, licence number;

The contact information, including legal and a mailing address;

Bank requisites;

Participation of the credit organisation in authorised capitals of the affiliated and dependent organisations with instructions of the name of the organisation and a share in its capital;

Organizational structure (the list of staff with instructions FIO on all posts since the head of department); positions about committees operating in bank and other joint bodies.

As to the second section of the plan «Reason of financial obstacles», in our opinion, there is no necessity to allocate it separately. Proceeding from our conclusion that re-structuring can be applied also concerning financially stable organisations, the given section will appear inappropriate. We recommend to the second to make the section devoted to interpretation of financial circumstances of the organisation, with the subsequent definition of the reasons which have caused necessity of carrying out of re-structuring in relation to the given organisation. In this section tools of the financial analysis of a bank of commerce and its market positions considered in paragraph 2.1 can be used.

Also in this section the list of large creditors of bank with instructions of their share in liabilities of bank should be presented.

The third section «Measures on re-structuring» assumes presence of the description of measures on re-structuring of a bank of commerce. Measures on re-structuring can be grouped as follows:

Participation of shareholders and the third parties in bank re-structuring; measures on restoration, improvement and liquidity maintenance; sources of reduction of expenses;

Sources of reception of incomes; the other.

As participation of shareholders and the third parties in bank re-structuring it is understood:

Rendering of free aid to bank, including a delay of repayment of a part of obligations, increase in term of loan, placing of additional means on accounts; furnishing a collateral of the credits involved with bank; refusal of shareholders of reception of dividends. Among the most widespread measures on restoration, improvement and liquidity maintenance we will note the following:

Asset sale, not income or which maintenance is connected with high costs not paying back; buying up of own obligations with discount; return of debts, revealing wrongful and queer transactions; satisfaction of requirements of creditors for the account of a cedation it of assets, realisations of mortgaging values. Reduction of expenses can be reached for the account: reductions of the staff of employees; reduction of economic expenses;

Closing of unprofitable directions of business, branches, representations; reduction of percentage expenses. Sources of additional incomes can be: bezriskovye commission operations;

Placing of means under concrete profitable operations; granting in rent of property of bank; placing of means in vysokolikvidnye assets. It is possible to carry to other measures of re-structuring: control system re-structuring;

The organisation (perfection) of system of the internal control;

Table 4 Number of a stage the Name of action Terms of carrying out the Answer! vennye executors Expected

The economic

Effect 1 2 3 4 5 • 41

The plan-schedule of measures on re-structuring of a bank of commerce

- Reengineering of business processes.

The list of measures on bank re-structuring can be presented in the form of tables (table 4).

With a view of a substantiation of the project of re-structuring it is recommended to make perspective balance re-structurings (table 5).

After a choice of the concrete plan of re-structuring it is necessary to start directly working out of the business plan of re-structuring. Carefulness of the analysis by preparation of the plan of re-structuring, and then and the business plan provides approachibility of the purposes.

It is necessary to notice, that the Russian banks thoughtlessly enough concern drawing up of business plans, including at a stage of creation of the organisation. For this reason of hope of competent working out business - of plans of re-structuring are improbably small, and meanwhile the qualitative business plan is a pledge of successful re-structuring.

In the third column of table 5 cost of a corresponding kind of the assets, corrected on level of their real liquidity, and a present value of a corresponding kind of passives is reflected. In the eighth column — the interest rate of profitableness of assets or the interest rate of service of a debt capital.

4-J № Article the Sum with Kommei - Change Change the Result About the Income p/likvidats. The account „43

tar and and balanso balanso (3+5 cent (the expense) p balance korrek vyh articles vyh articles +6) naja for tirovki for the account for the account the rate accounting vypolne movements the period nija mero an active / of acceptance of a passive on terms of an exit 1 2 3 4 5 6 7 8 9 - Perspective balance of re-structuring

Let's note some typical lacks of business planning:

Absence or insufficient disclosing of the information on degree and character of possible influence of founders (participants) on bank activity;

Presence of contradictions between various sections of the business plan;

Data presentation about organizational structure in the form of transfer of names of the controls provided by the legislation instead of the detailed description of a control system, assuming a designation of communications between divisions and functions of the last, fixation of principles and volumes of distribution of powers and responsibility between heads of divisions and controls, the review of the internal documents regulating realisation

Operations and the control over their realisation, instructions of the basic risks and methods of their minimisation;

Absence in plans of settlement sizes of rest funds; absence of the plan on estimated reserves; absence of forecasts of observance prudentsialnyh the norms of activity having a quantitative estimation; absence of an economic substantiation of plans of incomes, expenses and profit; presence of a disproportion of assets and liabilities of balances of claims and liabilities on claiming and repayment terms; absence of plans on sources of capital costs in the presence of plans of acquisition of objects of the real estate; absence of plans on sources of formation of an authorised capital in the presence of forecasts on its substantial growth; inadequate reflexion of obligatory deductions in the budget; absence of a plan of measures on repayment of losses of last years;

Absence of the information on the auditing firms confirming reliability of reports, and results of auditor checks;

Absence of decodings of articles "other incomes" and "miscellaneous costs";

Insufficiently detailed and generally the unreasonable information on client and resource base.

According to instructions from July, 5th, 2002 «About business plans of the credit organisations» №1176-У business plans are made in following cases:

At creation of the credit organisation;

At expansion of activity of the credit organisation by

Receptions of additional licences;

At change of a kind of the credit organisation;

By reorganisation of the credit organisations in the form of merge, allocation, division, transformation by the credit organisation, made the decision on reorganisation;

By reorganisation of the credit organisations in the form of joining by the credit organisation to which there is a joining.

Last two cases represent ways of re-structuring. Therefore to some extent we can assert, that drawing up business - of plans of re-structuring is obligatory for the credit organisations.

We recommend to develop the re-structuring business plan according to the following structure:

The general data on the project

The general data on a re-structured bank of commerce

The re-structuring plan

The organizational plan

Accounting budget

Appendices

Let's explain the maintenance of separate sections of the business plan of re-structuring.

1 section. The general data on the project.

In the given section it is necessary to specify the name of a capital investment project and its purpose is formulated, participants of the project are listed, the essence of the last along with an estimation of its current condition is explained. In the same section it is necessary to define stages and term of realisation of the project, its cost, including on realisation stages, and also sources of finance. Here criteria of efficiency and the finance indexations necessary for realisation of monitoring of the project are established. As criteria of efficiency of the project such indicators, as the pure discounted income can be used

(There should be positive), a project time of recovery of outlay (the more shortly, the more attractively the project), internal norm of profitableness (high rates - high interest to the project).

On the basis of criteria of efficiency of the project credit status of the project as the relation of the pure discounted income to the discounted sum of paid percent and payments in the cancelling a credit can be calculated.

2 section. The general data on a re-structured bank of commerce.

In this section following data on bank are represented: the full official name of bank, licence number;

Contact the information, including legal and a mailing address;

Bank requisites;

Authorised capital size, founders, and also degree and character of their influence on bank activity;

Participation of bank in authorised capitals of the affiliated and dependent organisations with instructions of the name of the organisation and a share in its capital;

Organizational structure (including a designation of communications between divisions and their functions, fixation of principles and volumes of distribution of powers and responsibility between heads of divisions and controls, the review of the internal documents regulating realisation of operations and the control over their realisation, instructions of the basic risks and methods of their minimisation);

Positions about committees operating in bank and other joint bodies;

Data on the auditor organisation (auditor).

- 3 section. The re-structuring plan.

The present section consists of two mainframes: financial circumstances of a bank of commerce at the moment of decision-making on re-structuring and measures on re-structuring.

In the first of these blocks it is expedient to specify following aspects of a financial position of a re-structured bank of commerce:

Potential of a bank of commerce;

Prospects of development of bank (the purposes, problems are described, a market banking policy; the factors, capable to render and making essential impact on bank activity, first of all, legal and economic are defined; possibilities and restrictions of development of client base, possibility and restriction of development of a filial network, a network of representations and other isolated structural divisions) are estimated a condition;

Observance of requirements prudentsialnogo bank supervision (the retrospective and perspective analysis of performance of obligatory specifications and obligatory reserve requirements, the plan of formation of estimated reserves);

The reasons which have caused necessity of carrying out of re-structuring in relation to the given bank of commerce;

Calculation of a current commercial value of bank (it is necessary for a re-structuring substantiation).

In the following block of the plan of re-structuring it is recommended to consider such questions, as:

The plan-schedule of measures on re-structuring of a bank of commerce;

Calculation of a commercial value of bank after carrying out of actions for re-structuring;

- Estimation of efficiency of introduction of the project on re-structuring (paragraph 2.3 see).

Section. The organizational plan.

In the fourth section the mechanism of realisation of the project of re-structuring is described. Namely, it is proved the organizational form of realisation of the project (on the basis of operating bank or again created, shares of founders, forms and conditions of their participation in the project are specified, principles of distribution of profit, a liability for damages), is developed the securities issue order, is defined the administrative board on project introduction (official functions, responsibility distribution, organizational communications, the management period).

Section. An accounting budget.

In an accounting budget join:

Substantiation investment (on project realisation) and current expenses;

Financing requirement calculation, definition of structure of sources of finance with a view of maintenance of comprehensible level of a financial soundness of bank;

Substantiation of incomes;

Sources of finance (volumes and terms of financing);

Tables of monetary streams for liquidity maintenance;

Calculation of indicators of economic efficiency of the project (the pure discounted income, a time of recovery of outlay, internal norm of profitableness);

Estimation of probability of realisation of the project (the analysis of sensitivity and stability of the project);

Financial forecasting (formation prognoznoj the reporting, calculation prognoznyh values economic

Specifications and the basic finance indexations of efficiency of activity of the re-structured bank).

6 section. Appendices

In the given section the documents confirming reliability of the initial information and resulted calculations accumulate.

The structure of the business plan offered above has been developed by the author on the basis of the maintenance of a standard capital investment project [66], typical structure of the business plan of the credit organisation [30], the circular of the Central Bank of the Russian Federation from April, 27th 2000 № 26/1461 «About typical lacks business - of plans of the credit organisations» [6] and requirements to the plan of the re-structuring, developed by Agency on re-structuring of the credit organisations [25].

The final stage of realisation of process of re-structuring is the estimation of efficiency of its introduction.

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A source: Chapkina Elena Gennadevna. Features of the restructuring of Russian banks at the present stage of the reform of the banking system. Thesis for the degree of candidate of economic sciences. Moscow - 2004. 2004

More on topic 2.2. Working out of the business plan of re-structuring of bank:

  1. 3.1.A role of a technique of definition of requirements of bank in re-structuring in working out of the business plan of re-structuring
  2. 3.2. Maintenance of effective application of the business plan in the course of re-structuring of microlevel of a banking system
  3. the Plan-schedule of measures on Bank re-structuring
  4. the Establishment of an order of the periodic reporting of chiefs of the enterprises and establishments about a course of fulfilment of the confirmed program (the plan, the business plan)
  5. the Establishment of an order of acceptance of administrative decisions at not achievement of the purpose of the state, program default (the plan, plan business-)
  6. 2.1. A technique of definition of requirements of bank in re-structuring
  7. 3.5. The investment memorandum (petition) and the business plan
  8. media plan Working out.
  9. the Appendix 4 RECOMMENDED STRUCTURE BUSINESS - the PLAN
  10. Table 1 Calculation of an actual commercial value of Bank before re-structuring
  11. 1.3. Problems of re-structuring of branch complexes and working out of new principles of management.
  12. 2.3. Re-structuring of a banking system and creation krupnyhregionalnyh banks - as a condition of the decision of a problem of the investment by bank.
  13. Chapter 3. Some features of business planning in the course of re-structuring microlevels of a banking system of the Russian Federation
  14. Chapter 3. Methodical bases of an estimation of business at re-structuring of the companies by methods of integration of the capital
  15. THE CHAPTER II. THE PROBLEM OF THE PARITY OF THE PLAN OF EXPRESSION AND THE MAINTENANCE PLAN IN EVOKATIVNYH FORMS
  16. 3.2. The organisation of process of a project financing in a business bank
  17. 3.1 Use of criteria of stability in working out of programs of anti-recessionary bank management
  18. Diversifikatsija in bank business:
  19. 2.2. A business bank place in formation of system of a project financing
  20. 3.1 Working out of a tariff policy for the mixed portfolios of services of a bank of commerce