Analyzing Strategic Financial Management at ABC Bank Plc: A Report

This report provides an in-depth analysis of strategic financial management and its significance in the banking sector, using ABC Bank Plc as a case study. The introduction provides an overview of the project, background of the research, significance, purpose, aims, objectives, and research questions. A comprehensive literature review explores the concept of strategic financial management, its importance in the banking sector, and its application in measuring the performance of ABC Bank Plc. The research methodology section details the research design, philosophy, approach, data collection methods, data analysis techniques, and ethical considerations. The report aims to identify the concept of strategic financial management, determine its importance in the banking sector, and evaluate the strategic financial management tools used to measure the performance of ABC Bank Plc. The findings of this study can assist professionals working in the banking sector, and the management of ABC Bank to identify their problem areas and strategies that can increase their financial performance.

Strategic Financial Project

Table of Contents
TITLE: ............................................................................................................................................1
INTRODUCTION...........................................................................................................................1
Overview of the Project..........................................................................................................1
Background of the Research...................................................................................................2
Significance of Research........................................................................................................2
Purpose of this Research........................................................................................................3
Research Aim.........................................................................................................................3
Research Objectives ..............................................................................................................3
Research Questions................................................................................................................3
LITERATURE REVIEW................................................................................................................4
Concept of strategic financial management...........................................................................4
Importance of strategic financial management in banking sector especially ABC Bank Plc 5
Use of strategic financial management in order to measure the performance of ABC Bank Plc
................................................................................................................................................5
RESEARCH METHODOLOGY.....................................................................................................6
Research Design.....................................................................................................................6
Research philosophy...............................................................................................................7
Research Approach ................................................................................................................7
Method of Data Collection ....................................................................................................8
Data Analysis .........................................................................................................................8
Ethical Consideration ............................................................................................................9
REFERENCES .............................................................................................................................11
APPENDIX ...................................................................................................................................12

TITLE:
To analyse the significance of strategic financial management in measuring the
performance of the banking sector. A case study on "ABC Bank plc".
INTRODUCTION
Overview of the Project
Strategic financial management is considered as a study of finance with a long term view
which considers the strategic goals of any financial institution or agencies. Understanding of
bank financial management is helpful in order to determine effectiveness of banking operations.
It evaluates, whether the bank is performing to an acceptable level. It can be done in a systematic
way for the entire banking industries. It might be done temporarily or for a particular aim so that
overall growth and profitability of banks can be enhanced in near future (Finnerty, 2013).
Strategic financial management tools are effective in strengthen the company and creates value
in developing the performance of firm in appropriate manner. Strategic financial management
has involve various tools like reporting/ analytics, cash positions management, accelerate
receivables, control payables, manage expenses etc. these tools are effective in measuring the
performance of banking sector in appropriate way. Strategic financial management includes
precise analysis of an organisation's business objectives, goals, determining and quantifying its
available or significant resources and devising a plan for utilising finance and other capital
resources to attain its targets. Due to industry pressures, many banks are having to stretch
themselves into market sectors. Strategic management in banking plan provides senior bankers
and board members with wide range of opportunities to reassess and explore the upcoming
banking developments. The banking industry is generally considered as an old industry and it is
one of the essential factor behind the growth and development of countries economy. Due to the
contribution of banking industry which is provided to the societies or countries. ABC Bank Plc is
the chosen organisation for this particular report. It is an international bank which provides
various financial products and services in the country of United Kingdom and internationally.
The major focused area of firm is towards attaining higher growth and profitability through
managing the financial as well as other resource of firm in appropriate manner. Resources are
the key element of any business organisation as the financial and the other resources are required
to be mentioned in respect to attaining the targeted objectives of the firm. It is necessary for
banking industry to maintain its finance and capital in order to conduct long term business
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operations which are beneficial for growth and development of firm. The present research is
based on the analysis of significance of strategic financial management in measuring the
performance of banking sector (Kerzner, 2011). In this report, importance of strategic financial
management and its influence on the performance of the firm will also be discussed.
Background of the Research
In this particular research, an analysis of modern banking in a competitive environment is
provided. Modern banking operations involves dynamic strategic planning in which a clear
mission is mentioned and this is significantly connected with profitability of firm. Different
strategies are created and certain objectives and goals are placed in a systematic way as to
assisting the operations of firm in right direction (David, 2011). ABC Bank Plc is an
international bank and its headquarter is in Manama, Kingdom of Bahrain. The network of the
company spreads around five continents which covers the middle East, North Africa, Europe, the
Americas and Asia. ABC Bank Plc is founded in year of 1980 and it is listed on the Bahrain
Bourse and our major shareholders are the Central Bank of Libya and Kuwait Investment
Authority. The company provides trade finance solutions comprising contract bonding,
documentary letters of credit, specialized documentary, commodity finance, ECA financing,
private insurance backed products, Islamic finance, receivables financing, and forfeiting; and
project and structured finance advisory services to clients in the oil and gas, power and water,
petrochemicals, mining and metals, telecommunications, infrastructure, shipping, and aviation
sector. The ABC Bank Plc is concerned on providing effective financial products and services to
their significant customers in respect to sustain them for long run of business operations. The
company is significantly focused on using strategic financial management tool in respect to
maintaining the resource of firm so that growth can be attained in effective manner.
Significance of Research
This research is conducted to provide a better understanding on the concept of strategic
financial management and its impact on the performance of banking sector. This research work
will help readers and scholars to ascertain the importance of this method with the context of
banking segment of financial services sector. This research will play a pivotal role for future
researchers as they wont need to conduct any market research and can analyse various results by
considering this research report (Bryce, 2017). This research can help scholars engaged in the
study of finance and the professionals engaged in management of banking company. In this
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report, ABC Bank Plc has been analysed which can assist professionals working in banking
segment. With the help of this research, researcher will be able to gain knowledge and
understanding about the topic and will be able to convey all aspects of this topic. Management of
ABC Bank will also be benefited as they can ascertain their problems areas and ways by which
strategic financial management can increase their financial performance. Importance related to
the topic of strategic financial management includes identification of ability of measuring
financial power of an organisation.
Purpose of this Research
The reason behind conducting this research is to understand the concept of strategic
financial management and its significance in banking sector especially in ABC Bank Plc. The
major purpose of this research is to overcome with the issues related with previous research of
same area. The main focus of this report is banking segment of financial services (Resch, 2011).
Research Aim
This is the most fundamental element of a research project as it provides an appropriate
direction to the researcher or investigator about the topic. The major aim of this research is “ To
analyse the significance of strategic financial management in measuring the performance of the
banking sector”. A case study on ABC Bank Plc.
Research Objectives
Research objectives for this investigation are mentioned below:
 To identify the concept of strategic financial management.
 To determine the importance of strategic financial management in banking sector
especially ABC Bank Plc.
 To evaluate the strategic financial management tools which helps in measuring the
performance of ABC Bank Plc.
Research Questions
Questions for this specific research are portrayed below:
 What is the concept of strategic financial management?
 What is the importance of strategic financial management in banking sector especially
ABC Bank Plc?
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 What are the strategic financial management tools which helps in measuring the
performance of ABC Bank Plc?
LITERATURE REVIEW
This element of the research includes in depth research about the objectives of the
research. This segment provides a theoretical framework which helps in deciding the assessment
of different writers and journalists (Patanakul and Shenhar, 2012). Literature review for this
particular research report is discussed below:
Concept of strategic financial management
This concept refers to the specific planning which is related with the management of
company's financial resources. This concept is concerned with the assistance of an organization
in order to attain their business objectives (Brook and Pagnanelli, 2014). It involves the process
of defining an organization's goals and objectives so that management of the entity can plan for
available resources. These resources includes financial funds, personnel of the firm, other
tangible and intangible resources etc. This method of strategic financial management is used by
any company to not only manage their resources but to strategically manage their resources.
Strategic management is an advanced branch of management in which all resources whether
financial or non financial has to be first analysed and then distributed according to the nature of
activity. This analyses of resources is conducted by ascertaining potential of those resources.
According to Dennell R. Lester,; financial industries are the most influenced sector when
it comes to political and economical factors especially banking segment. In order to protect
operations and development of banking companies, the management of these companies are
initiated to adopt strategic financial management. It is a planning process which has various
stages and among these stages, the initial phase of planning is most crucial as it involves
financial decisions and evaluating cost occurrence with the help of several techniques such as
budges (Daniel, Ward and Franken, 2014). Other stages of this process is concerned with
implementing strategies and distribution of resources. Financial decision making is an element of
this concept which assist the managers of a banking company to take reliable and profitable
investment decisions.
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Importance of strategic financial management in banking sector especially ABC Bank Plc
ABC Bank Plc is a public limited company which operates in multiple countries
including United Kingdom, Italy, France and Germany. The headquarters of this bank is in
London and deals in commodity finance, treasury services and many more. Strategic financial
management is considered to be most beneficial for banking sector due to which ABC Bank Plc
has adopted this method in order to operate efficiently.
From the view point of Anna Mok; banking segment of financial services sector is facing
intense competition in current scenario and in order to obtain competitive advantage they offers
various innovative services to their clients. These services are internet banking, numerous
options of accounts and many more (Petit, 2012). To attain the maximum level of satisfaction
from their customers, it is important to efficiently manage all these services and their related
operations. ABC Bank Plc uses methods of strategic financial management to manage all their
operations by effectively utilising their resources. In context of banking sector, resources are
mainly the funds which are gathered from the clients which needs to be invested in order to gain
profit. Significance of this concept or method can include efficient financial planning and
sensible approach to resources. This method helps ABC Bank Plc to establish their objectives
and formulate all the policies which can assist in achievement of organizational plans. Along
with developing strategies, this method also guide to implementation of those strategies. ABC
Bank Plc is a large scale company which deals in multiple services and has to perform numerous
operations. In order to manage all their operations, this bank uses this method so that they can
identify all their available resources and distribute them effectively in order to gain profit as well
as development.
Use of strategic financial management in order to measure the performance of ABC Bank Plc
Strategic financial management is a process which has set of functions and techniques
which can be used to measure the performance of a company. In case of ABC Bank Plc,
performance aspects which is required to be measured are profitability, growth rate, liquidity and
ability of paying debt in due period (Cooremans, 2011). This company deals in financial services
due to which it is important to measure their financial position which can be determined using
above aspects.
According to Amy Van Looy and Aygun Shafagatova, the process of strategic financial
management combines planning and formulation of strategies which can help in determining
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policies of administrating capital and amount of capital that is needed to be raised so that
profitability can be measured. There are various tool which assist an organisation to measure
their performance such as Analytics, Cash position management, manage expenses and control
payables. ABC Bank Plc uses these tools to ascertain efficiency in their activities. Analytics tool
helps in tracking all the data and information of the company and distil it with Key performance
indicators from which they can measure their big data by interpreting them into smaller pieces.
Another tool of measuring performance is cash position management in which all cash inflows
and outflows are analysed by the help of break even and budgeting. Manage expenses and
control payables are few other tools which helps ABC Plc Ltd in controlling cash flows so that
they can measure the performance. They look after functions which affects performances such as
electronic payments, electronic approvals and electronic invoices. In the process of manage
expenses; spend optimisation, strategic outsourcing and financial literacy are few tools which
measures the performance related to spend power of a bank (Killen and et. al., 2012).
RESEARCH METHODOLOGY
It is simply the method by which a research is conducted. Some significant element of
this methodology are discussed below:
Research Design
Research design is a systematic approach that a researcher adopts while conducting a
scientific study. It is the combination of all the components which are identified while
conducting the research. Research design should follow a strategic methodology in order to come
up with accurate and reliable design (Eweje, Turner and Müller, 2012). It is a process of
collecting information and data for the purpose of making business decisions. The information
which is used in research can include both present and historical information. This the blueprint
of the research which defines priorities of all the tasks required to be completed in the research.
There are four types of research designs and they are exploratory, descriptive, explanatory and
evaluation. In the present research work exploratory research design is selected by the
investigator as it is effective in exploring the outcome of qualitative research by providing
appropriate description and evaluation. The reason for not using descriptive design is that it is
based on specified case study or naturalistic observation in which highly in-depth analysis is
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required. The experimental research is based on statistical data and information as it is based on
quantitative research.
Exploratory research design is considered as a study which is designed to explore not
predict the research in an accurate way. This design is a scientific method which involves
observing and describing behaviour of the topic. This design can be used by observation, case
study or by survey. The focus is on gaining insights and familiarity for later investigation or
undertaken when research problems are in a preliminary stage of investigation.
Research philosophy
This considered as the most essential part of research methodology. It refers as the belief
about a way in which data and information related to a phenomenon needs to be accumulated,
analysed and used (Thomas and Silva, 2016). The major obligation of an investigator is to select
the suitable philosophy as to providing support to the study through analysing the opinion of
various authors. The investigation is mainly based on two parts like interpretivism or positivism
research philosophy. Interpretivisim philosophy is encompasses on interpretivists content that
only through the qualitative interpretation of and intervention in reality in which reality can be
fully understood. On the other side positivism philosophy is appropriate for the investigation in
which scientific and mathematical models are applied as to analysing and accumulation of data.
The current study is based on the significance of strategic financial management in measuring
the performance of the banking sector. In the present research work interpretivism philosophy
has been taken into proper action by the investigator as it is based on qualitative research work or
in this data has been accumulated on the basis of real assumption. Interpritivism is effective for
this report as it is suitable in drawing valid and reliable outcome for the report.
Research Approach
This is also an essential part of research methodology, an approach is considered as a
plan and procedure for the investigation which span the stages through assumption to detailed
tools of data collection, analysis and interpretation. It is important for an investigator to choose
the most appropriate approach to assist the research in right direction. This section is emphasis
on two major types like deductive or inductive research approach. In the deductive research
approach new theory is developed and it is proved through the implementation of hypothesis,
thus in this outcome is fixed by the observation of available facts and figures. On the other hand
inductive approach is based on observing existing facts and perceptions. The present
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investigation is based on the significance of strategic financial management in measuring the
performance of the banking sector. The current study is based on theoretical aspects and in this
inductive research approach has been taken by investigator as to drawing substantial and
dependable outcome for attaining objectives of the subjective investigation.
Method of Data Collection
Data collection is considered as the process of gathering data and information through
relevant sources to find out answers to the research problems, test the research phenomenon and
analyse the outcome. This can be categorised among two major parts such as primary and
secondary source of data collection (Boesso, Kumar and Michelon, 2013). In this section of the
investigation, researcher having the option to gather data from primary or secondary source as
per the reliability of the study. The data which is gathered for the very first time through the
primary source like survey, observation etc. is known as primary information. The secondary
information is on the other side evaluated as the source in which data is gathered through
extracted sources like books, journals, articles etc. in an investigation data has been gathered
through both primary as well as secondary source of data collection. Primary tools is effective in
conducting survey through applying the measures of interviews, questionnaire focus group etc.
secondary tools is effective in conducting the section of literature review in effective manner
through fathering data and information with the help of books, published journals, articles etc. in
the present research work secondary source is applied by the researcher as to creating a relevant
theoretical frame work. The major reason for selecting secondary tool is to gather reliable data
in respect to drawing valid and accurate outcome. This is the best tool because this provides a
brief discussion on the specified area of study through analysing the opinion of various authors
and writers.
Data Analysis
This determined as an another essential part of research methodology, which plays vast
role in analysing the aspects of research in effective manner. Data analysis if considered as a
process of inspecting, cleansing, transforming, and modelling data with the goal of discovering
useful information, informing conclusions, and supporting decision-making. It is required for the
investigator to analyse the accumulated data and information in respect reaching at a valid and
reliable outcome. In respect to conduct an evaluation, the investigator can adopt qualitative or
quantitative means as it is based on the which which is accumulated by the researcher for carry
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out the investigation in a right direction. It is through adoption of suitable methods that the
researcher is able to draw valid and reliable outcomes. The research into consideration is of
qualitative nature which in turn indicates application of qualitative means. In a research work
data analysis is considered as the essential element as it is required for the researcher to analyse
the accumulated data as to drawing valid and reliable outcome. In this report data will be
analysed through conducting survey as in this thematic analysis will be conducted by using
graphs and charts.
Ethical Consideration
The ethical consideration are emphasis as very critical component for directing an
exploration in an appropriate way. At the time of conducting an investigation researcher faces
various kind of issues and conflicts, thus it is the major obligation of the investigator to ensure
their respondents about the safety and security of their personal as well as professional
information (Martos-Vila, Rhodes-Kropf and Harford, 2013). Deductive disclosure, also known
as internal confidentiality is the process of data protection which the researcher has used while
conducting the survey, which helped the investigator in protection of personal information. In
strategic level research on banking sector, it is important to collect financial information of
banking companies such as ABC bank Plc. but this data is access sensitive. The main access
issue while collecting this data is there is no primary information about banks are available. In
order resolve this issue instead of primary information, secondary data from various sources is
collected. Researcher ought to guarantee that personal questions are not being asked during the
observation. Over the span of directing exploration work, researcher needs to ensure that
research is led as per the selected targets of the investigation. The researcher needs to collect all
the important data through real and dependable sources. It very well may be said that the
investigator is dependable to direct research activities according to the implemented rules and
standards. It is basic for researcher to think about every single ethical norm, while directing
exploration work. Time and cost are also considered as the another essential issue which has
direct influence on the research activities. It is essential for the investigator to design an
appropriate time frame in which all the activities are implemented as per the priority of the
research operations. Cost is also a major issue it is also important for the investigator to maintain
appropriate flow of funds and capital as to conducting research activities in effective and
efficient manner.
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