Agricultural Bank of China: Improving Business Efficiency and Growth

Introduction Of Agricultural Bank of China Case study

Agricultural Bank of China (ABC) is one of the "Big Four" state-owned commercial banks in the People's Republic of China. It was founded in 1951 and is headquartered in Beijing. The bank provides a wide range of financial products and services, including deposits, loans, foreign exchange, bank cards, online banking, and investment banking. ABC also has a large network of branches and ATMs throughout China, as well as an expanding international presence.

The bank is involved in various social and environmental initiatives, such as promoting sustainable agriculture and supporting rural development in China. ABC has received recognition for its efforts in corporate sustainability and has been listed on the Global 500 Most Sustainable Corporations in the World by Corporate Knights.

In recent years, ABC has focused on modernizing its operations and adopting new technologies, such as artificial intelligence and blockchain, to improve customer service and enhance its competitiveness in the market.

Introduction Of Agricultural Bank of China Case study

Vision and Mission Statement of Agricultural Bank of China

The vision statement of the organization, Agricultural Bank of China: the bank proposes a commitment to build an international and first class commercial banking facilities which will offer various featured banking operations, convenient services for the customers, diversified functions for better value creation.

The mission statement of the organization, Agricultural Bank of China: “providing shannong banking services for both urban and rural areas, maximizing shareholder’ returns and helping employee management”.

Vision and Mission Statement of Agricultural Bank of China

Industry Structure and economic feature

The system is segregated into two separate levels: PBOC and other commercial services. These two parts are divided into four different states commercial banks, joint stock companies, banks of national interest, and foreign banks.

The industry majorly focuses on delivering a scope for the massive economic exchange of goods as well as services in exchange of money and other financial assets.

Agricultural Bank of China Strategic

Part 1: Business-Level Strategies

To build up the services on an international level for the first class commercial banking groups which basically features in operations for better convenience of services.

Part 2: Corporate-Level Strategies

To implement precise planning of industrial poverty alleviation plans and optimize product innovation.

Competitive Analysis and Advantage in the Industry

The Agricultural Bank of China is well positioned in the Chinese banking industry which not only provides better services but also capitalizes the future growth of China in both urban and rural areas. The online and remote channels support the extensive offline channel of the company. On the other hand, the company itself has a large and diversified group in China which grows the potential in having better customer support. As for the advantages in the Chinese banking market,, the company helps in having a strong and stable growth in the banking industry by the help of low cost funding.

SWOT Analysis

Strengths:

the high level of customer satisfaction in the Chinese population and strong cash flow in the company.

Weaknesses

The limited access outside all kinds of core businesses. The company also failed in taking up challenges against the new entrants.

Opportunities

Threats: new environment and changes in government regulations can be possible threats against the company.Political: The policy approach by the government of China

PESTLE Analysis

Economic: The presence of stability in the economy and focussed shift from the manufacturing to the service industry.

Social: the increased number of household production as well as urban employment.

Technological: the promotion of new e-commerce as well as technology through the process of innovation.

Legal: Fraudulent activities and NPA needs to be checked as it attracts legal procedures.

Environmental: Various presence risks in the environment

Target Market Analysis of Agricultural Bank of China

i) 4Ps’ comparisons with competitors:

ii) Product: Corporate banking, personal banking, and agro-related banking are offered to the population. The company also offers investment banking and life insurance for better banking experiences.

iii) Price: The Agricultural Bank of China keeps their prices minimum to make a better appearance in the marketplace.

iv) Place: The bank offers its services as well as their products nationwide where they have branches in developed and rural areas. The bank has over +20000 outlets in total. Agricultural Bank of China also has branches in Asia, Europe and pacific.

v) Promotion: The company promotes their products and services by the help of television, mobile, SMS, email, social media and printed media to help the population gather enough knowledge about the services. On the other hand, the company also conducts conferences, seminars and other events for better awareness.

vi) Strengths’ comparisons with competitors: The physical presence and low prices helps the company to become stronger than the competitors.

vii) Weaknesses’ comparison with competitors: The autonomy at the local government affects the services of the company.

viii) Organization’s Competitive Advantage: Better positioning of the company and loyalty of the consumer base enriches the competitive advantages of the company.

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Key Success Factors

The plentiful access to all kinds of household deposits has become one of the major success factors of the company.

Problems and Issues in Agricultural Bank of China

The bank is currently facing a lot of issues related to performance and bank loans. The Agricultural Bank of China has a major issue in delivering better performances for their banking and the increased rate of bank loans is affecting the same.

Financial Analysis

The Agricultural Bank of China has a gross profit margin of +25.50 units. As for the return on assets, the company is having 0.86 units of return on assets and 11.77 units for equity.

Conclusion

The paper discussed the internal and external analysis of the company Agricultural Bank of China to understand its performance in the banking industry.