Case Analysis of First National Bank

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First National Bank|
A Case Study“If we don't change, we don't grow. If we don't grow, we aren't really living.”-Gail Sheehy| Amil, Paula BiancaIsidoro, Joanna MarieRojas, RobertSampang, Makrene LaraSeptember 17, 2010Prof. Aliza Racelis|


Point of View: Sammy Viray, New FNB President


Background Information
Sammy Viray and his assessment of the bank
* In June 3, 1993, Sammy Viray reported to First National Bank (FNB) as its new president. * Studied in one of the prestigious Ivy League schools in the US and rose to become an influential bank officer at Citibank, a multinational bank, in the ‘80s and the president of a government bank prior to joining FNB. * After weeks of observation, he thought that the bank needs a “major surgery”. He made a list of what should be accomplished within his first year as president: * Modernization of operations through computerization making all branch operations “on-line.” * Branches and departments should have financial targets. * Human Resources Development programs were needed.

* New products and services had to be introduced.
* More branches should be opened.
* He was convinced that FNB should not waste time because of the liberization of the banking industry. * He thought that younger employees seemed to be more aggressive and capable of coping with his vision. The Bank

* First National Bank has been in business for 30 years.
* It has 50 branches as of 1993.
* It has a foreign partner with 40% interest on FNB’s stocks. * Sixty percent of FNB’s stocks is held by a single family who dominates he management policies at the Board level. * Because the former president was Chinese, majority of the bank’s business dealings were with the Chinese community. Bank Employees

* The former president of the bank, Gerry Tuazon, served the bank for 15 years prior to being promoted as Chairman of the Board. It was known within that bank that he was pressured to relinquish his position as president. * Many branch managers were over 50 years of age and were hired on the basis of recommendations of the major stockholders. * Some department officers of the banks were young graduates. * There was no labor union in the bank.

* Employees felt secure about how the management treated them because of their relationship with the stockholders. Employees stayed with the bank until retirement. -------------------------------------------------

What change strategy should Sammy Viray use to implement the changes he envisions to accomplish during his first year as president without compromising the morale of employees and driving away existing Chinese clients? Short-term: What change strategy will help maintain the morale of the employees and not drive away the existing Chinese clients? Long-term: What change strategy will help the change be internalized by the members of the organization in the long run? -------------------------------------------------

Areas for Consideration
* Branch managers are over 50 years old and were recommended by stockholders – might take the customers with them * Mostly young graduates dominate the investment banking and corporate services department * Close ties with the Chinese community

* No labor union – close relationships between employees -------------------------------------------------

* Changes will be implemented within a year – Approved by the board of directors * There will be no changes in the organizational structure * Implementation of changes will...
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