Development And Growth Of Commonwealth Bank †MyAssignmenthelp.com

Question: Dicsuss about theDevelopment And Growth Of Commonwealth Bank. Answer: Introduction The Commonwealth Bank of Australia is one of the leading multinational bank which provides various kinds of financial services such as institutional banking, retail and fund management, investment and broking. It is one of the top listed bank on Australian Securities Exchange. To study the macro environmental factors which will help in the development and growth of Commonwealth Bank, it is necessary to conduct a pestle analysis of Australia (Madsen 2016). PESTLE Analysis Remote Environment Serious Threat Mild Threat No Impact Mild Opportunity Great Opportunity Economics - The macroeconomic outlook is very gloomy as US dollar is dominating the international monetary system and it can cause global economic imbalance. - Free trade agreement with other countries which will enhance global business expansion and policy interest rates are soaring high now. It is a stable and growing economy. Technology Cyber security which is a major area of concern for the banking and financial institutions (Weill and Woerner 2013). - - - Investments will helps to build a strong technological network. Socio-Cultural - - - - The cosmopolitan culture which is marked by diversity and use of technology in day-to-day life will influence the bank to expand Political-Legal There may be litigation against the bank and different kinds of allegation which are related to money laundering. - - The dynamic and strong policies will facilitate the financial policies in times of sustainable growth in business. Good relation with China and other emerging Asian economies. The four pillar policy will prevent the merger of the Australian banks with the other competitors at a low risk. Global - - - - - Environment The regulation on water and land agreements and climate change will impact Commonwealth Bank Legal action will help to disclose the risks in climate change - - - Demographics - - Ageing Population can pose an impact on bank as they are not used to with new emerging banking technology - - Total Impact No such serious threats - - - - SWOT Analysis Strength Diversified credit portfolio can impact on CBA in managing fixed income investment strategy Leading Australian Bank Greater emphasis on technologies in financial sector and marketing can help them to overshadow others Robust capital ratio and financial position are high for CBA and it will help them to retain the profits Opportunity Indigenous customer assistance will help CBA to provide better customer service and more retain of customers Expansion in other emerging economies as well as Asia and expansion gives increase in market share Weakness Greater dependence on borrowings from overseas can impact on tax related issue Greater operation expense can increase the operation cost Limited geographical diversity Threat Higher capital requirement as bank equity is more expensive than bank debt Phasing out government guarantees Economic slowdown in China and fragile business environment (Johnson 2017). TWOS Analysis Opportunities (external, positive) Threats (external, negative) Strengths (internal, positive) Improved capital and financial position will help in customer assistance. Diversified credit portfolio will remove the higher capital requirement Weakness (Internal, negative) Greater dependence on borrowings from overseas market will help in customer assistance. Greater dependence on borrowing will remove higher capital requirements (Mahmood, Chung and Mitchell 2017) Conclusion The Commonwealth bank has received funds from all the major central banks in times of emergency. The Commonwealth Bank has suspended its operation in times of emergency and it has helped the other banks in improving the financial and capital performance. It has also provided diverse credit portfolios to other banks. It is important for commonwealth bank to look into the cyber security challenges and take appropriate action so as to prevent money laundering. Thus, it is important to assess the Australian Financial industry to examine the features of Commonwealth bank. References Johnson, G., 2017.Exploring strategy: text and cases. Pearson. Madsen, T.L., 2016. Business Policy and Strategy. Pearson. Mahmood, I., Chung, C.N. and Mitchell, W., 2017. Political connections and business strategy in dynamic environments: How types and destinations of political ties affect business diversification in closed and open political economic contexts.Global Strategy Journal. Weill, P. and Woerner, S.L., 2013. The future of the CIO in a digital economy.MIS Quarterly Executive,12(2).