ANZ Bank: Analysis of Markets in France, Brazil, and Korea

This presentation analyzes the markets in which ANZ Bank can trade including France, Brazil, and Korea. It discusses the structure, profitability, potential problems, cultural aspects, and foreign exchange and trade implications of each market.

N A M E O F S T U D E N T S :
N A M E O F P R O F E S S O R :
C O U R S E T I T L E :
D AT E :
ANZ Bank

Introduction
The Australian and New Zealand Banking Group
Limited is ranked third among other Australian financial
institutions.
The entity’s headquarters are located in Melbourne and
its revenue is estimated to be 21.07 billion AUD
(Alessandri and Nelson 2015).
The presentation aims to analyze the markets in which
the bank can trade including France, Brazil and Korea.

The structure of market in France
One supervisory system is in place in eradicating the
distinction between commercial or merchant banks.
The Bank of France oversees the activities of other
enterprises operational in the republic (Bai,
Krishnamurthy and Weymuller 2018).
Moreover, the Bank of France issues notes assuming
operations which are monopolistic.

The structure of the Brazilian market
According to Almeida and Divino (2015), financial institutions are categorized with respect to
their specialization including the National Monetary Council, National and Social Development
Bank, Banco do Brasil, the Central Bank of Brazil as well as the Federal Savings and Loan
Association.
The CMN is responsible for developing monetary policies essential for social as well as economic
developments while BACEN executes policies relating to exchange controls while regulating the
activities of financial institutions.
Banco do Brazil finances institutions operating privately or publically and executes lending
programmes which attract subsidies from the federal government.

The Korean market’s structure
 Banking services are highly concentrated in Korea albeit the efforts made
with regards to restructuring with numerous efforts geared towards mergers
and acquisitions.
 The banks operational in Korea include specialized local institutions and
branches affiliated with different foreign banks (Emery 2017) as well as an
informal market that deals with credit in addition to capital markets.
 The Bank of Korea is required to supervise the banks operational in Korea.

The French market’s attractiveness and profitability
The banks in France are grouped under one
supervisory system.
The earnings set to accrue to the banks
established in France are set to experience
some hurdles owing to the interests offered
for loans which are quite low (Dietrich and
Wanzenried 2014).
Hence, the profitability anticipated by
operational financial institutions is bound to
be quite low.

The Brazilian market’s profitability
In Brazil, the input of state governments can
be anticipated depending on the
specialization of the institution involved.
Regardless of the recession that might be
evident in different global regions, the banks
that operate privately in Brazil continue to
register increased growth.
Therefore, the market offers some viable
prospects that encourage market entry.

The Korean market’s attractiveness and profitability
The financial system established in Korea constitutes of
enterprises that offer services which may or may not be
finance related.
The risk presented by Korea’s banking industry
indicated some improvements in the assessments
conducted (Trendowski et al. 2017).
However, the profitability which can be anticipated
from operating in the nation is considered to be modest.

Potential problems in the French
market
Novel disruptive technologies such as FinTech are heavily changing the course of how
business can be conducted in France which is bound to present a challenge for ANZ
Bank.
Non-bank providers such as Western Union as well as Moneygram present the
possibility of stiff competition for ANZ operations.
Client preferences are also undergoing a shift where retail clients anticipate e-commerce
integration with retail payments as well as social media which is an obstacle that ANZ
Bank must be prepared to overcome.

Potential hurdles in the Brazilian
market
The scope for ANZ Bank to operate in Brazil is limited which portends a challenge
as the system mostly focuses on the provision of credit for short durations (Galán, Veiga
and Wiper 2015).
ANZ should anticipate to offer credit on a short-term are also considered as a means
through which profits can easily be attained
However, the challenge anticipated is that the bank may be forced to experience an
increment in the provisions which are made in respect to bad loans when dealing with its
Brazilian clientele.

Challenges to be anticipated in the Korean market
In Korea, most of the conglomerates which are operational are bankrupt
implying that they are a liability should they decide to borrow from ANZ Bank.
Moreover, the likelihood of ANZ acquiring some bad debts is quite high
from its targeted clients (Yun and Moon 2014).
The Korean market is characterized by limited capacities with respect to
risk management skills which is a significant hurdle should the ANZ desire to
evade the credit hardships evident national wide for operational institutions.

Future developments (French market)
France is anticipated to make use of various innovations including marketplace as well as
blockchain technology to foster some revolutions with regards to how trade is conducted
(Schoenmaker and Peek 2014).
Trends indicate an increasing preference for ascertaining that noncore activities are outsourced.
Moreover, the workforce available is likely to exhibit extensive diversity as recruitment is
bound to occur globally.
Therefore, it will be mandatory for banks to create a culture that is cohesive in order to attract
the loyalty of employees.

Future developments (Brazilian
market)
Brazil is acclaimed for its involvement in activities that underscore emergent
technologies which will be an influential factor in respect to how banks can serve their
clients.
The ecosystem present in Brazil is considered prime for facilitating firms which offer
venture capital which are more Latam-focused (Vilar and Simão 2015).
The outcome is that the demand for the services available from various financial
institutions is bound to greatly increase while depicting a bias for an approach that
focuses on users.

Future developments (Korean market)
In future, foreigners are among the prospects under consideration by the Government
as a result of their extensive expertise to oversee most of the Korean institutions offering
financial services that will have been privatized (Cohn, Fehr and Maréchal 2014).
The market available in Korea is bound to experience increased competition owing to
an increment in the number of entrants.
Moreover, the provision of financial products which are digital in nature with great
innovation levels is anticipated with an abolishment of branches which previously relied on
the brick and mortar systems.

Foreign exchange and trade implications (France)
The investments that foreign banks may decide to make in France must be authorized by the
Autorité du Contrôle Prudentiel et de Résolution (Rebai, Azaiez and Saidane 2016).
In addition, the institutions allowed offering services which are banking related are required to
have licenses approved in either France or Europe.
The operation of international banks in France is only allowed where they establish branches
or subsidiaries.
Subsidiaries are considered as legal entities which must develop the systems they prefer to use
for governance and strategies to ensure that their risks are effectively managed (Apergis 2015).

Brazilian foreign exchange and trade implications
Trading in Brazil implies that the ANZ Bank must deal with the prevalent inflation
levels in the nation.
Institutions under the jurisdiction of foreigners are currently being considered as a
viable option in comparison to the BNDES particularly where long-term investments are
considered (Wanke and Barros 2014).
The establishment of subsidiaries linked to various foreign banks creates the
requirement that authorization must be sought from the president operational in Brazil
and a presidential decree which is also mandatory.

Foreign exchange and trade implications in Korea
Foreign exchange and trade in Korea is likely to face some challenges owing to
the policies developed in addition to the various forms of regulatory interventions.
Extensive pressure on the margins available in the industry is evident owing to the
struggles experienced by foreign operators including Stanchart as well as Citibank
(Mera and Renaud 2016).
Foreign banks also face situations in which their dividend payments are
suppressed.

Cultural aspects in the market operational in France
that may impact entry
Enterprises seeking to operate successfully in France must note the etiquette required for
business deals from being receptive to client feedback and not focusing on the gender of
organizational employees.
Hence, the operators interacting with clients might be mandated to converse in French
regardless of the differences that might be evident in the dialects used regionally (Perez 2018).
The French are accustomed to having the acquisition of the services they desire through
measures which are extensively simplified. For example, bank accounts which are simple are
attainable from La Banque Postale. Clients are guaranteed of incurring minimal charges and their
accessibility is assured owing to the existence of post offices in areas where people live.

Brazilian cultural aspects impacting
entry
. The implication is that ANZ Bank’s success is bound to be evident where relationships are
cultivated on a level that is personal.
Hence, clients can be expected to avail themselves to negotiate on matters relating to their
acquisition of loans organizations must be willing to make some time investments into the process
Owing to Brazil’s protectionist culture, enterprises established by locals are bound to enjoy
numerous advantages in comparison to foreign operators.
Hence, establishments may elect to undertake must involve the efforts of agents with the
appropriate qualifications.

Korean cultural aspects impacting
entry
Language is among the barriers that establishments can anticipate and
therefore, foreign banks are required to have access to language support at all
times.
The scene evident locally does not extensively encourage diversity
regardless of the benefits it heralds.
Moreover, the events which can be held for networking purposes are more
likely to ingrain some extensive formalities which align with Korean traditions.

Conclusion
The market available in Brazil offers better
prospects for ANZ Bank.
Hence, profitability can be expected for ANZ
when if it decides to venture into Brazil.
Some of the banks established in Brazil
indicate a growth estimated at 850%
regardless of the conditions evident
economically.

References
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