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American University in Bosnia and Herzegovina (AUBiH)

Business Administration (MBA), BAM 658 Strategic Planning

Group Project Final project

Students:

Professor:

Dino Ibrahimovi
Bezdrob PhD

Muamer

Enes Tuna
Ahmet eunovi

Sarajevo, 23rd May 2015

ABOUT THE COMPANY


Bank was established in October 2000 as a joint venture between tree
international finance institutions. Bank started operations on 2002 as the first
bank operating on nonconventional banking principles, not only in Bosnia &
Herzegovina but in the region as well.
Bosnian banking industry is characterized by a very strong competition by
Austrian, Italian, Croatian banks as well as the lack of legislation. Yet, BANK has
managed to achieve a very good status in the B&H banking sector by offering
different banking products and services. Nevertheless its orientation to these
principles, Bank primarily targets the whole population in B&H and the Bank
renders its services to all B&H citizens no matter which ethnic group they belong
to.
The Bank has its Head Office in Sarajevo and its branches in major cantonal cities
in Federation of B&H and now has 20 organizational units throughout Federation
of B&H and Brko District.
The Bank has recorded positive trends and is going from strength to strength
across all criteria measuring success of the bank, such as growth of the number
of clients (both individual and corporate), expansion of financing portfolio,
increase of deposits, increase of the value of assets and increase of profit for
shareholders.
The Bank renders its products and services to both retail and SME and corporate
clients, with their relative proportion of one third and two thirds, respectively, in
the total Bank financing portfolio.
The Bank currently employs 247 staff, a majority of whom holds university
degrees, are fluent in foreign languages and are dedicated to the principles of the
bank. They are experienced and well trained in a great number of specialist
courses in B&H and abroad.

Below are the last available financial statements that give a complete picture of
the bank performance.

Basic performance indicators show that the Bank continuously increases its
customer base. We will present only the most important

Total loan disbursements compared with the last yearincreased by 14,81%,


growth of the retail financing is 27,16% and the growth of corporate financing is
9,26%

Total bank deposits compared with the same period last year increased by 18%
yoy

Compared with the same period lastyear, total bank assets increased by 16%

Also, it is evident that Bank is expanding its business scope which results with
bigger market share on B&H market.

Market share in deposits

Market share in financing


2012F; 1.78%

2012F; 2.18%

2011F; 1.47%

2011F; 1.78%
2010F; 1.47%
2009F ; 1.31%
2008; 0.93%

2010F; 1.16%
2009F ; 0.96%
2008; 0.73%
2007; 0.68%

2007; 0.61%

MISSION AND VISION


To bring closer and to promote the new nontraditional concept of banking
principles and products in B&H and to constantly render high quality services in
all segments of the Banks activities and operations to the benefit of its clients,
social community, our shareholders, the employeesand the social community.
Our vision is to dedicate all of our knowledge and expertise to meetof our clients'
needs and to gain high quality in all segments of our business operations, for the
benefit of our shareholders, employees, and the social community.

OBJECTIVES

To continue overtaking of good clients from the competitors in Retail and


Corporate sectors at a time when local banks have slow growth in the local
market;
To improve Cost Income Ratio from 83% in 2013 to 79% in 2014 by increasing
business operations along with gradual new investments, thus increase
repayment o capital from 0.2% in 2013 to 1.16% in 2014;
To use the advantage of already established credit lines and lines for
guarantees and letters of credit, promote those lines to clients and, in
accordance with their needs, to open new lines;
To increase credit portfolio by placing focus on small and medium clients,
short-term Retail and Corporate financing.

STRATEGY

To continue overtaking the market at the time of stagnation and slow growth
of local market in the aim of overtaking of bigger market share and attaining
higher profitability of the Bank;
To increase Corporate portfolio by 37% and Retail portfolio by 23% in the aim
of recovery of local economy and still low demand of the citizens;
To expand the network of branches and branch offices of the Bank by
adjusting prices and by making innovations in products to increase the Banks
market participation share in all parts of the Retail segment (deposits,
financing, credit cards, etc.), and to make more efforts to increase operating
income;
To monitor receivables from clients more strongly and to apply more
conservative policies while approving financings in order to maintain portfolio
quality on the present level;
To provide long-term and low cost deposits and credit lines from the
Shareholders and to ensure direct financing of individual projects of the
leading BH companies.

Since this is a bank which is in difficult economic conditions managed to establish


itself as a respectable financial institutions with a strong ownership structure,
strategy of aggressive market penetration appears to be a suitable.

ACTION PLAN
1. Retail Banking Division
-

Increase of retail deposits

Increase of deposits will be achieved through the following:


-

Expansion of branch network (the goals set by the Budget of the Bank for
2014 are distributed through the branches under the supposition of
opening of 6 new branch offices with the following schedule:
1 Branch offices in the 1st quarter (1 Branch office opened at the end
of March);
o 3 Branch offices in the 2nd quarter (April, May and June the effects
of the Branch office that was opened in June can be expected in the
3rd quarter);
o 2 Branch offices in the 3rd quarter (1 Branch office in July and 1 in
September the effects of the Branch office opened in September
can be expected in the 4th quarter);
o at the end of June and 1 at the end of July);
Permanent improvement/advancement of the existing deposit products;
Introduction of new forms of savings (programs of special purpose savings;
housing, car purchase,);
Permanent improvement of alternative sales channels (external
associates);
To intensify promotion programs for collection of deposits from the B&H
Diaspora in a form of promote campaigns and direct contact by visiting
associations and Dzemat of B&H Diaspora (the program has been
started in the current year and produced good results);
To intensify marketing and promotion activities related to the existing and
new savings-deposit products;
To intensify cooperation with the Islamic community in B&H for promotion
of savings products of the Bank, especially Zakat and Hajj savings, as
well as promotion of the Program for the B&H Diaspora.
o

Retail Financing

Increase of financing shall be achieved through:


-

In 2014 it will be necessary to prepare encouraging-promotion actions in


the first and second quarter, in the form of :
discount of the price of products (housing construction, mortgage
financing, home remodeling and car purchase - larger amounts, as
well as financing consumer goods and tourism dispersion of risk
and profitability) for certain segments of targeted market (Banks

clients, employees of public institutions and large industry entities


in B&H) It is necessary to perform this activity in the first six
months of the year but to place focus on the first three month in
order to generate profit margin;
approval of certain products with facilitated approval conditions
(over a certain period), enabling larger amount of financing without
compulsory mortgage as repayment security ins along with higher
financing price;
offering free of charge issuing of credit cards and campaign of
auto-issued cards on segmented clients base. Apart from this
activity it is necessary to design loyalty rewarding systems and use
of credit cards in places of sale;
Expansion of the network of branches/branch offices in order to acquire
new clients who for practical reasons did not operate their business
through our Bank;
Intensive marketing activities in promotion of retail financing products;
Improvement/restructuring of the existing financing products and approval
procedures (housing construction, car purchase, purchase of consumer
goods, tourism, education, buying out projects, mortgage housing, credit
cards, overdraft of current account and other Banks financing products);
Packaging the Banks products and services. The packages should result by
higher income because they would include and promote use of larger
number of products and services (Package no.1. - Current account,
overdraft, SMS, standing order, savings). Certain discounts would be
approved for users of certain packages in all or some types of financing. IT
quality support would be a condition for an efficient implementation;
More aggressive performance in the market, which would reflect through
more intensive animation of new clients. That part of activities should be
performed in close cooperation of Retail and Corporate Banking Divisions.
The existing and new branches should start more intensive activities for
establishing cooperation with merchants and bidders of different services;
Delegating more authorities to branches that are producing satisfactory
level/percentage of collection (e.g. over 95%). Authorization would be
reflected through increase of limit of maximum amount of financing a
branch may approve independently;
More efficient alternative sales channels (external assistants).

Improvement and advancement of the existing products will be primarily directed


to simplification of the procedures, maintaining competitive position with other
banks and establishing faster and more efficient communication between the
clients and the Bank.
In addition to that, the Bank planes to introduce service and product packages,
which should result with an increase of overall volume of the operations of
individuals with the Bank. The beneficiaries of packages will also have additional
benefits in the form of discount of fees, membership fees and profit margin on
some types of financing.
-

Alternative channels

As an additional sale channel, the alternative channels of sale will be focused


on acquisition of new clients and sale of products with high margin (credit
cards, short-term financing) to certain groups of clients and especially to small
and medium private companies and citizens.

The basic advantage of the alternative sale channels is that they can reach a
client throughout Bosnia and Herzegovina, and particularly in the areas where
the Banks branch network is not developed.
Moreover, they can contact clients after the working time of branches.
a. In order to fulfill the given tasks, the alternative channels must be
trained and skilled to actively perform combined sale of all Banks
products and services. Training will be performed for each particular
product by responsible persons of every Branch, who is engaging
and monitoring the sale channels
1. Improvement of the existing and development of new products
Improvement and development of new deposit products:
Responsible
part of the
Bank
Retail
(Product
Development
Unit)

In cooperation
with

IT,
Legal Dept.
Services
and
Support Group

Commencement
1. Improvement of
all Bank deposit
products
and
services
2. Introduction of
new products and
services
3.
Product
packages

Conclusion

Permanent task
Permanent task
End of
quarter

second

Improvement and development of new financing products:


Responsible
part of the
Bank
Retail
(Product
Development
Unit)

In cooperation
with

Commencemen
t

Services
and
Support Group,
Legal Dept,
Credit
and
Market
Risk
Management
Division

1. Improvement
of all financing
products
2. Introduction of
new products and
services
3.Product
packaging

Conclusion
Permanent task
Permanent task
End of
quarter

second

Improvement and advancement of the existing products will be primarily


directed to simplification of the procedures, maintaining competitive position

with other banks and establishing faster and more efficient communication
between the clients and the Bank.
In addition to that, the Bank planes to introduce service and product
packages, which should result with an increase of overall volume of the
operations of individuals with the Bank. The beneficiaries of packages will also
have additional benefits in the form of discount of fees, membership fees and
profit margin on some types of financing.

NETWORK OF BRANCHES
Market situation study has shown the following important indicators:
-

Large number of banks in terms of retail and corporate clients operates in


a very small market (over-banked market) covering market by their
numerous branch offices. Every larger inhabited place in B&H has a
branch office of one bank;
A bank that has the largest percent of covering of the market has slightly
below 100 branch offices bank is offering its services in only 12 locations
and of that number 5 are situated in Sarajevo;
With regard to inhabited places, bank covers about 7-8% of total market;
The extent of covering of the number of inhabitants shows that the Bank
can offer its services directly (present in the territory of their residence) to
about 20% of the total number of the population of B&H;
bank is not present at all and it is not covering adequately two very
important economically and population wise regions and they are: Western
Herzegovina and Tuzla region.

Taking into account the above stated and planned increase of financings and
deposits there is an evident need for further expansion of the network of
branches. We believe that it is necessary to open minimum 6 new branch offices
in 2014. Expansion strategy would be:
-

Branch offices would be part of the existing branches of the Bank.

- In the initial phase, small number of employees would be hired (3) and we
would rent business premises in order to create lower costs of equipment, rental
and maintenance.

CARDS CENTER DEPARTMENT


a) Issuing credit cards (Visa Classic and Bamcard)
The plan for 2014 is to increase the sale by approx. 21% with regard to
31.12.20013 and reach the number of 6,900 cards at the end of the year. The
sale of credit cards is planned through the following channels:
o Regular sale through the existing network 500 pieces
o Sale through new branches/branch offices 600 pieces
o Sale through acquisition of Corporate clients 100 pieces
which in total is 1,200 new credit cards of which 1000 should be Visa Classic
cards.

The plan is not ambitious because of present fear of potential clients to have a
debt to a bank, certain saturation of credit cards market, as well as planned
change of credit cards concept next year.
In order to realize the plans, in 2014 it will be necessary to continue with
occasional marketing and different promotion campaigns. With supposed sale
and existing fees the following values could be reached:

Number of BamCard credit cards to be issued in 2014 1,200


Total number of credit cards to be issued by 31.12.2014 6,900
Issuance fee/ on one-time payment basis/ KM 20.00
Membership fee /per annum/ - KM 25.00 (average membership fee for 2
types of credit cards)
Average use of cards in 2014 (for cards issued in 2014) 80% of approved
limit
Average use of cards in 2014 (for present cards) 75% of approved limit
along with revolving 50%
Average approved limit- KM 2,200.00
Planned approved credit limit in 2014 KM 2,640.00
Average transaction fee 11% of the transaction amount
Transaction fees total KM 852 thousands (new holders KM 232 thousands,
present holders KM 620 thousands).

b) Issuing VISA cards


Issuing Visa Electron Cards
Visa Electron Card current account debit card is an international card with a
Chip technology and positive trend of issuing of that card achieved in previous
year should be continued in 2014 as well. It is especially important to take into
consideration considerable expansion of THE BANK network of branches and
branch offices.
In addition to the planned opening of 3,000 new current accounts it is expected
that the same number of holders of current accounts would become holders of
Visa Electron card.
Visa Electron card, which can generate considerable income to the Bank in 2014
(KM 180 thousands not counting the fee for current account), represents to the
Bank a cross-selling product whose sale will directly depend on the terms,
administration, speed and amount of approved overdraft of current account.
The data on planned income from Visa Electron cards in 2014 are based on the
following suppositions:

Number of issued cards in 2013 3,000


Total number of cards issued by end of 2014 12,000
Issuance no fee

10

Annual membership fee KM 10.00


Total membership fee KM 90,000.00
Fee for cash transactions KM 65,000.00 (30x7,220x12x2.5%)
Fee for non-cash transactions KM 25,000.00 (50x8,330x12x0.5%)
Average monthly card turnover KM 300.00
Fee for cash transactions 2.5% of transaction on other network
Income from non-cash transactions (Visa Interchange fee) 0.5% of
transaction amount
Ratio of cash/non-cash transactions 80%/20%
Share of cash transactions on other banks network 12.5%.

Income Plan for 2014


KM'000
Ite
m
No.

in

INCOME
DESCRIPTION

Notes
Plan 2014

To issue 3,000
debit cards

VISA AND BamCard

new

Annual membership fee


from 9,000 existing card
1. holders

90 Fee collected from clients

Fee
from
3. transactions

65 Fee collected from clients

Fee
from
4. transactions

cash
non-cash
25

Fee collected from Visa

180
To issue 1,440
credit cards

new

Admission
membership
1. fee 20 KM*

Fee collected from clients


20

Annual membership fee


2. 25 KM *

155

Fee collected from clients

Fee
for
keeping
of
account and statements
3. delivery

Fee collected from clients


120

4. Transaction fee

852 Fee collected from clients


1.147

Total
income
issuing

1.327

Total number of issued


cards in 2014 4,200

11

Cards
acceptanceacquiring
Income from acquiring of
1. other bank' cards/ATM**
Income
2. merchants/POS***

In total 20 ATMs
35

from

In total 200 POS terminals


18
53

TOTAL INCOME

1.380

*
Under supposition that 17% of sale would be realized in time of promotion
campaigns (free of charge cards).
** Including planned installation of 6 new ATMs.
*** Including planned acquisition of 100 new POS terminals.

CORPORATE BANKING DIVISION


TASKS:

Increase of financing by 40%, of which short-term financing by 63% and


long-term financing by 24%;
Increase of documentary operations (guarantees and letters of credit) by
16%;
Increase of income from financing by 29%.

PRECONDITIONS:

To define the role of branches in the part of Corporate financing: to form


organizational parts that will function within the Corporate Banking
Division;
Work on quality support within the Bank (define the role and competency
of credit administration, ensure quality IT support in monitoring of clients
and reporting part);
To have a clear strategy in terms of selection of clients (first-class clients
require more flexible approach such as lower profit rate, insurance that
may not be first-class);
To increase the number of employees in accordance with the plan.

TARGETED GROUPS:
Present clients of the Bank

To work intensively with the existing clients on expansion of business


cooperation, especially in the part of operations that could bring
considerable income to the Bank (foreign payment, sight deposits);
To expand the business cooperation with clients who are partly working
through the bank by taking over (buying out) financings from other banks;

12

To expand business cooperation by making packages of products for Retailclients employees.

Acquisition of new clients

Clients
Clients
Clients
Clients
Clients
Clients

who
who
who
who
who
who

prefer Islamic banking;


need short-term financing;
need trade finance services (guarantees and letters of credit);
have deposits long-term sources;
have significant foreign payment operations;
have large number of employees (retail clients).

CRITERIA FOR SELECTION OF CLIENTS

Quality business cooperation background with the bank;


Clients business operation (stable market position, positive cash flow);
Quality collateral and guarantee;
Profitability of relation with client;
Client's operation;
Technical- technological capacities;
Position in the market, comparative advantages;
Financial relation with the Bank (balance of the accounts with the Bank,
Balance positions-ratio);
Vulnerability analysis, cash flow.

INDUSTRIES

Financing large wholesale food and goods chains from which we can
expect considerable
foreign payment operations and generation of
income;
Financing food producers, production which has secure placement in local
and foreign market;
Project financing (financing projects which have secure investors and
collection instruments);
Financing crude oil and oil derivatives;
Financing production that has contracted undertakings and secured
market supply.

PRODUCTS

Short-term financing of working capital;


Long-term financing for buying out of debt from other banks;
Guarantees and letters of credit;
Restructuring short-term financing into long-term financing to the Banks
clients with a goal to unburden and adjust to clients repayment abilities.

TREASURY AND FINANCIAL INSTITUTIONS DIVISION


Pursuant to the new Rules on Internal Organization and Systematization, which
has instituted the Treasury and FI Division, in 2014 it will be necessary to further
develop and advance the operation of its departments.

13

4.3.1. Financial Institutions Department


The Department will be engaged in the following activities:
Establishing and developing of cooperation with financial and other
institutions from which certain funds could be drawn (IFAD, EBRD,
governments of Islamic countries, etc.);
Profitable placement of surplus funds in treasury operations along with
further development of relations with banks which operate under Islamic
principles;
Developing credit lines for trade financing operations in accordance with
the needs of the clients.
Development of Customer desk as product, which has manifold
significance for the operations of the Bank with the support from the
Corporate Banking Division.
Expansion of network of correspondent banks according to needs and
requests of clients with special accent on accounts of the large B&H
Diaspora abroad.

Deposits, Liquidity, Liquidity and FX Risk Assessment Department


The Department will be engaged in the following activities:
Maintaining KM liquidity and FX position of the Bank in accordance to the
rules of the Banking Agency and internal limitations,

Maintaining the level of limitations to Bank's assets in accordance with


the regulations of the Central Bank of B&H, the Banking Agency and
internal enactments along with management of surplus of funds in the
manner which would maximize profit;

Organization and providing support to the Liquidity Committee;

Preparation of materials and technical support in the work of ALCO,


implementation of its instructions and conclusions related to this
segment of the operations.

Central Treasury Department


The operation of the Central Treasury Department should be elevated to a certain
level that would enable:
Establishing control system and monitoring of the operation of the
cashiers and the treasury in terms of observance of the Rules and
Procedures that regulate that field of the operations;

Overseeing development of the business network in terms of securing


cash;

Creating the conditions and suppositions for development of own


servicing of the business network by cash in order to decrease
dependence on cash servicing by other entities;

Overseeing the work on day-night treasury and further placement of


those services in cooperation with the Corporate Banking Division.

Investment Banking Department

14

In 2014 the Investment Banking Department should further develop in the


following segments:
To monitor and oversee realization of financing joint projects with THE
BANK Real Estate Co.;

In cooperation with the Corporate Banking Division to continue placement


of products of depositary operations for tender bidders in the securities
market and depositary operations in issuance of securities;

To monitoring of trade securities portfolio of B&H firms;

To research the possibility of operation with Islamic bonds - Sukuk;

To research and develop a possibility of investment in funds in Islamic


countries.

ACTION PLAN IT and Operations Group


PAYMENT OPERATIONS DEPARTMENT
The Bank planned increase of income from corporate payment operations by
approximately 16% comparing to 2013. Despite the existing economic situation
and announcement of further lowering of economic activities, the given increase
is based on planned acquisition of new Corporate and retail accounts in 2014.
It can be expected that volume of inflow from abroad will further decrease
in 2014, especially private remittances to individuals. Therefore, increase of total
income by approximately KM 180 thousands has to result from opening of new
clients accounts, particularly corporate clients for realization of major internal
payment operations.
Attraction of a large number of clients and increasing the volume of
payments, even those that are physically dislocated with regard to the existing
branches and branch offices, can be achieved by higher electronic banking
services sale.

LOAN ADMINISTRATION DEPARTMENT


In the first six months of 2014, the Loan Administration Department will direct
most of its activities to centralization of activities of loan administration and
improvement of the existing procedures in order to free the Banks branches and
branch offices from loan administration work and to enable them to focus on
sales increase and higher collection of receivables.
Centralization process and technical activities related to that will depend a lot
on IT support.

TRADE FINANCE DEPARTMENT


As shown that income from documentary operations has considerably been
increasing each year, the Bank is determined to continue with development and
improvement of those operations in 2014, to sell those products to as large as
possible number of clients in order to enable huge dispersion of risk and finally to
increase the income of the Bank. Moreover, it is necessary to continue advancing
specialized know-how of the employees who are engaged in that work, by their

15

participation in seminars. In case that the number of these operations increases


considerably in 2014, there might be a need for additional hiring of employees.

CREDIT RISK MANAGEMENT DIVISION


CREDIT RISK ASSESSMENT
-

Assessments of risks of files and documentation prepared by Corporate


Banking Division and Retail Banking Division for approval of financing,
Letters of guarantee, Letters of credit or other forms of investment that
increases the Banks risk exposure, for regular and extraordinary meetings
of the Financing and Investment Committee;
Filling in vacant positions in the Credit Risk Assessment Department for
SME and Retail and Credit Risk Assessment Department for Large Clients
and Syndication.

Responsible
part of the
Bank

In cooperation
with

Commenceme
nt

Conclusion

Credit
and
Market Risks
Management
Division

Business Group

Permanent task

Permanent task

MARKET RISK ASSESSMENT


-

Setting up of Market Risk Assessment Department;


Compliance of the existing procedures with Amendments and Supplements
to the Decision on Minimum Standards for Market Risks Management;
Filling vacant working positions.
Responsible
part of the
Bank

Credit
and
Market
Risks
Management
Division

In cooperation
with

Commencemen
t

Conclusion

Treasury and IT
Division

Permanent task

Permanent task

CALCULATION OF THE PROVISIONS FOR APPROVED PLACEMENTS

16

Preparation of monthly proposals for calculation of provisions for retail and


corporate financing portfolios and the Report on overdue accounts under
categories C, D and E for current month. Collection of report from Business Group
for clients classified under categories A and B and delivery of overall report to the
Banks Management.
Responsible
part of the
Bank
Credit
and
Market
Risks
Management
Division

In cooperation
with

Commencemen
t

Conclusion

Business Group

Permanent task

Permanent task

COLLECTION OF DUE RECEIVABLES


-

Setting up of Department
for monitoring collection of problematic
receivables and reprogramming;
Filling vacant position in the Corporate Remedial Department
Undertaking activities for collection of due receivables for clients classified
under C, D and E categories in order to bring the level of allocated
provisions on optimal level;
Preparing strategy proposals for recovery of debtors and for possible
collection in accordance to the Program for Special Financing Risk
Management;
Preparing proposals for instigation of court proceedings for overdue claims
from clients.

Responsible
part of the
Bank
Credit
and
Market
Risks
Management
Division

In cooperation
with

Commencement

Conclusion

Legal Department

Permanent task

Permanent task

PR & MARKETING
PR activities
Ite
m
No.

Description of the task

Beginning and
completion

Quantity
Twice a month,

Preparing of THE BANKs


page in Preporod

Twenty four times a year

Preparing

Once a month, twelve

of

THE

BANK

Two pages
edition

in

every

Every 1st and 15th day


in a month and text
and
photos
are
dispatched
several
days earlier.
Newsletter is prepared

17

Newsletter

Arrangement of a page in
the Journal Banke

Developing
topics
and
arranging a page in the
"Business newspapers"

times a year, 4 pages of


information on THE BANK

at the end of every


month.

Twelve times a year

Page
is
delivered
several
days
prior
publishing
of
the
Journal

(1 page per edition or


more, if required)
Twelve times a year - one
page

Page
is
delivered
several
days
prior
publishing
of
the
Magazine

Writing news regarding


THE
BANK
for
news
agencies and media

At least twice a month or


more, if required

News
are
written
whenever the Bank
releases a new product
or initiates a new
action,
opens
new
branch, etc.

Arranging
pages
Magazine Zehra

Six times a year- two


pages

Texts and photos are


sent a few days before
preparation
of
the
Magazine.

Arranging
Magazine
Sumejja

Six times a year- two


pages

Texts and photos are


sent a few days before
preparation
of
the
Magazine.

Every time when we


have new info for the
public

Immediately after the


information has been
sent to media it is
translated and placed
on our Web.

Twelve times a year

On a first day in a
month

for

page
for
Bosanska

Updating the Web page

Writing monthly PR report

10

Preparing semi-annual PR
clipping

Twice a year

Immediately
after
expiry of the first six
months

11

Booklets
and
other
promotional material

Depending on the need


of the Bank

Immediately
agreement

after

an

12

Writing Jingles, spots and


advertisements (radio, TV
and press)

Depending on the need


of the Bank

Immediately
agreement

after

an

13

Designing
marketing
campaign
for
certain
products and services

Depending on the need


of the Bank

Immediately
agreement

after

an

14

Coordination
with
journalists who are coming
to
the
Bank
and
preparation of employees
for interviews

Depending on the need


of the Bank

Immediately
agreement

upon an

18

15

Notes for radio broadcast

Twelve times a year

Every 1st
month.

16

Proof-reading of monthly
reports
and
other
documents of the Bank

Depending on the need


of the Bank

Immediately
upon
receipt of material.

day

in

MARKETING
Planned Budget for marketing in 2014 amounts to KM 404 thousands.

Ite
m
no.

Marketing
activities
announcements)

(advertising

and

Total
in KM000

RADIO

36

TV

52

PRINTED MEDIA

46

EVENTS

PRINTING/PRODUCTION

69

SPONSORING ACTIVITIES

10

DESIGN

20

ALLOCATED FUNDS

50

ENTERTAINMENT (Eid presents for children, iftars,


dinners)

21

TOTAL

100

404

Division
The major objective of IT development strategy of Bosna Bank International is for
THE BANK to be recognizable in the B&H market by the following traits:

Operation based on Islamic principles

Operation efficiency.

Pursuant to that the most significant strategic goals of the IT Division are:

Close cooperation with other Bank divisions in the aim of aligning of the IT
priorities and plans with the needs of the Bank and increasing operation
efficiency;
Establishing of a system for decision-making support, which would help
considerably in the Bank management;
Lowering of operational risk that IT system presents for the Bank, which
before all implies implementation of the Data security management

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system; establishing, maintaining and testing of Disaster Recovery site;


application of standards for information system management (COBIT, ITIL);
Operational Plan for 2013 was ambitious and has been realized to large extent;
however one part of activities has not been realized due to objective reasons.
Operational Plan for 2014 represents continuation of activities in accordance with
strategy and leans largely on the plan of 2013, i.e. to realize activities that had
not been realized in 2013, as well as to improve the work with regard to 2013.
The major priorities in 2014 are:
-

Improvement of the Banks reporting system (both regulatory bodies and


management support reports);
Supporting of the Banks network expansion;
Amendment of credit cards processing system;
Implementation of software development standard;
Moving of the sales server;
Implementation of the Disaster Recovery Center;
Implementation of the Information security management system in
accordance with ISO 27101;
Education of IT Division staff in the domain of new technologies.

Detail IT Plan is given in a separate document.

LEGAL DIVISION
Department for Legal Procedures and Representation
KEY GOALS:
Representing the Bank before courts and other authorities for the
purpose of protection of the rights and interests of the Bank;
Providing legal counseling and interpretation of legal regulations;
Performing legal work related to insurance of receivables by
registration of pledge right over real estates, movable property and
securities and the related preparation of applications for notary public
processing;
Representing the Bank before notary public in the mortgage procedure;
Preparing contracts on pledge over movable property and securities;
Registration in the Register of pledges over movable property and
registration of pledge right over securities with the Securities Register;
Issuing of removing of pledge;
Performing legal action in legal proceedings, executive, criminal,
offences, administrative and bankruptcy proceedings in the aim of
protection of the rights and interests of the Bank and the related
preparation of legal suits, proposals, responses, appeals and objections
and other documents;

20

Representing the Bank in hearings and undertaking other legal actions


related to the stated proceedings and keeping accurate and updated
records of court actions and hearings;
Preparation of internal enactments and procedures in the domain of
the Department;
Performing current work;
Keeping data on clients and the Bank strictly confidential and
performing other work in accordance with legal regulations and general
enactments of the Bank and at instruction of the CEO of the Bank and
the Division Director.

Responsible
part of the
Bank

Department
for
Legal
Procedures
and
Representatio
n

In cooperation
with

Commencement

Conclusion

January 2014

Permanent task

Management,
Heads of
organizational
parts, Corporate
Banking Division,
Retail Banking
Division, Credit
and Market Risk
Assessment
Division and other
Divisions when
required.

Department for Normative-Legal Work


KEY GOALS:

Preparing of Retail and Corporate financing contracts;


Preparing of standard and special types of contracts;
Preparing and checking that legal enactments and procedures are in
compliance with the regulations;
Providing legal counseling and interpretation of regulations;
Promptly initiating and preparing drafts of the existing and passing of
new regulations in the domain of work, in accordance with legal
regulations;
Performing legal work related to the legal status and registration of the
Bank;
Performing legal work related to property insurance of the Bank and the
employees of the Bank;
Performing current work;
Keeping data on clients and the Bank strictly confidential and
performing other work in accordance with legal, sub legal and general
enactments of the Bank and at instruction of the CEO of the bank and
the Division Director.

21

Responsible
part of the
Bank

Department
for
NormativeLegal Work

In cooperation
with

Commencement

Conclusion

January 2014

Permanent task

Management,
Heads of
organizational
parts, Corporate
Banking Division,
Retail Banking
Division, Credit
and Market Risk
Assessment
Division and other
Divisions when
required

HR and ADMINISTRATION DIVISION


HR Department
KEY GOALS:
To pass and realize the THE BANK Academy Training Plan and Program of
the THE BANK employees which implies the following:
Internal training for all employees, especially employees of the
Branches;
Familiarization of employees with the Laws and the rules of the
Banking Agency of the Federation of B&H;
Defining of a model of skills and competencies for every working
position;
Setting up a data base for HR records quality management and
reporting;
Profiled training in Islamic Banking products (which would result by
new acceptable Islamic banking products);
Filling in of vacant staff positions, as well as coordination and
administration of hiring process of new employees, planning of necessary
number and structure of employees according to adopted methodology;
Implementation of evaluation and rewarding system which will contain
good promotion system to adequate positions;
Revision of Staff Rules of THE BANK;
Revision of Human Resources Policy of THE BANK;
Work on strengthening of motivation of employees through team work,
establishing friendly atmosphere, supporting initiatives of employees and
building professional approach to work;
Preparing draft general enactments based on adopted strategies, policies
and procedures from the domain of working-legal relations;
Calculation of salaries, bonus, rewards and other forms of recompense, and
performing other work in accordance with legal, sub legal and general
enactments of the Bank, and similar.

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Responsible
part of the
Bank
HR
Department

In cooperation
with

Commenceme
nt

Conclusion

Management, Heads
of Organizational
parts

January 2014

Permanent task

Employees of the HR Department are responsible for all above tasks, whereby
commencement of the tasks will be in January 2014.
The Operational Plan coincides in some items with the Plan for the previous year
because the Staff rules and the HR Policies have not been amended. The two
documents require revision and renaming so as to become part of the project HR
Potential Management; the parts that have to contain the provisions of the B&H
or FB&H laws should be defined in the way that they do not have to be amended
each time when laws change. We believe that it is necessary to pass a decision
on implementation of the project HR Potential Management.
Planned number of increase of employees in 2014 is 32. Detail plan for every
Division is attached to this Plan.
In view of the number of employees at the end of the year, we suppose that the
bank will have 190 employees (two branch offices with three employees, the
Executive Director and an employee in Credit and Market Risk Management
Division). It is possible that the bank will open one Branch office at the beginning
of 2014, but major preparation for that will be done in 2013.
Administration and General Services Department
KEY GOALS:

To constantly identify and decrease all necessary material costs;


To advance the system of investment and maintaining of the assets,
property and motor vehicles of the Bank;
To prepare a preliminary solution of organization and reconstruction plan of
the Head office of the Bank (approved by the Management of the Bank) in
accordance with the decision on and the development plan of the Bank,
together with the moving process and the related activities;
To implement the Plan of expansion of the Banks network (approved by
the Management of the Bank), in accordance with the decision on and the
development plan of the Bank;
To constantly provide support to all branches and organizational units of
the Bank in attaining their business goals;
To acquire automobiles for the Bank;
To continually perform acquisition of the material, small inventory and
services and investment and current maintaining of the premises,
purchasing department, multiplication work and printing, maintaining
cleaning services, etc.;
Proper observing the procedure of use and maintaining official cars of the
Bank;

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To improve the operation of the Central Archives of the Bank and to


determine precisely the procedure which will regulate the Central Archives;
All other additional tasks and requirements upon decisions and instructions
of the Management of the Bank.

Responsible
part of the
Bank

In cooperation with

Commence
ment

Conclusion

Administration
and General
Services
Department

Heads of organizational units

January
2014

Permanent
task

Security Services Department

To organize permanent training in field of physical and technical security


(using experience of others, organizing training sessions, etc.;
To monitor functioning and integrity of technical protection system of the
building;
To improve the system by introducing new technical means, i.e. solutions;
To fully implement the Plan for physical protection of all THE BANK
buildings and the Head office (to improve telecommunication facility
leading to the buildings of THE BANK), part that has not been realized in
2013.

The stated activities will be finalized in cooperation with other organizational


parts of the Bank, such as shown in the following table:
Responsible part
of the Bank

In cooperation
with

Security Division

Retail
Division

Security Division

Agencies
protection
persons
property

for
of
and

Agencies
protection
persons
property

for
of
and

Security Division

Security Division

IT Division

Banking

Commence
ment

Conclusion

First Saturday
in the last
month of
each quarter

End of each
quarter

Permanent
task

Permanent task

Beginning of
2nd half of the
year.
Permanent
task
Beginning of
2nd half of the
year

End of the year.


Permanent task

End of year

24

The given activities require above all presence of employees of the


Department in the Branches in order to rectify all shortcomings on site. The
third activity is upgrading of already installed technical protection systems to
enable new services and more advanced system technology, thereby,
defining conduct, activities and obligations through new procedures. The
fourth activity includes implementation of video surveillance project over all
buildings of THE BANK from the Head office of the Bank. The premises that
will be opened in 2014 have to be included in this project. This project
presents an important link in preventive actions, i.e. one of the ways of
prevention of potential invaders. It still provides full control in the work of the
security in the buildings over 24 hours with surveillance of the surrounding of
buildings and the business premises.

STAFF, TRAINING AND MORALE


Staff: Filling in vacant positions with high-quality and experienced banking
personnel
Continuous training:

Internal and external training for all employees, particularly of the


Branches;
Familiarization of employees with the laws and regulations of the
Banking Agency of the
Federation of B&H, Central Bank of B&H;

Profiled training about the products of Islamic banking (which should


result by new
acceptable products of Islamic banking),

Motivation and morale of employees:

Building professional approach to work;


Stronger team work;
Developing friendly atmosphere;
Rewarding for achieved results;
Supporting initiatives from employees;

SECRETARIAT
Planned activities of the Secretary General and Senior Assistant to Secretary
General of the Bank in 2014:
-

Keeping the shareholders register and other activities and actions related
to share capital of the Bank;

Preparing agendas, coordinating preparation of materials for meetings,


translating those materials, preparing of meetings of the bodies/Boards of
the Bank, as follows:
-

At least one bank`s General Assembly session;

25

At least four bank`s Supervisory Board meetings;

At least two bank`s Shari'ah Board meetings;

Two Bank Audit Board meetings;

Meetings of the Management of the Bank in accordance with the Rules of


procedures of the Management Committee;

Execution of all decision of the bodies of the Bank, monitoring of execution,


preparing of analysis of the extent of execution and reporting thereof to
the Boards of the Bank;

Organization and holding of 1 st International Investment Conference


Sarajevo Business Forum 2014;

Preparing minutes, decision and other documents of the bodies of the


Bank;

Keeping and distributing internal enactments of the Bank;

Conducting complete procedures for securing the funds, selection of


candidates and awarding scholarships;

Keeping the Charity Fund of the Bank;

Securing the legality of the work of the Boards of the Bank and other
crucial operations of the Bank;

Advising the bodies of the Bank;

Communicating with the members of the Boards in respect of responsibility


of members of the Boards and Shareholders, of holding of Board meetings,
obtaining visas for Boards members, etc.;

Drafting business and other correspondence;

Performing other tasks and work deriving from the nature of the work and
instructions of the relevant bodies of the Bank.

The following financial indicators for 2014 are integral part of this Operational
Plan, as follows:
Planned Balance sheet and Income statement for 2014;
Administrative Costs Budget and Capital Costs Budget in 2014;
Summary of the Banks staff requirements in 2014.

26