Assignment Task:

1. Industry regulatory and other external factors

The economic condition within the sector and general
The Australian economy is largely dependent on this financial services industry. In the latest financial year, this sector has made a contribution of $140 billion approximately to the country’s GDP. This sector stands as the core of the entire economy and is even employing approximately 450,000 employees. However, if compared with financial year 2018, the performance in the year 2019 stands lower, which is although, expected to grow soon.

Law and Regulations applicable to the client

The list of laws and regulations applicable are:
• Australian Corporations Act 2001
• Rules set by ASX
• New South Wales Law
• Guidelines of APRA
• Australian Accounting Standards
• Banking Act 1959
• Reserve Bank Act 1959, etc.

Level of competition and name of main competitors

Recently in the concerned sector, the competition level has grown up and new and existing entrants are pushing other businesses down by through innovative business and technological strategies. However, the Commonwealth believes the competition is conducted in a healthy business environment which is helping the business to shape its edges forward. The bank lies in the top list of the sector and is considered to be among the top 4 banking companies there.

The list of main competitors is:
• Westpac Banking Corporation
• National Australian Bank
• Australia and New Zealand Banking
• Citigroup
• ME Bank
• HSBC, etc.

Level of government’s support
The kind of support extended by government to the Commonwealth bank is in terms of aiding it to operate and attract a much versatile consumer group, including the ones that are very risk averse as well. The Australian Government extend protection under the “Financial Claims Scheme” (FCS) to the customers for their deposits in bank. The limit of protection is limited to $250,000 for every individual account holder. This support is applicable at the time of failure of the bank, and this situation, if happens, shall be under the administration of APRA.

Level of demand for goods or services provided
• Home Loans: the level of demand in this sector rose by 4%. The reason behind had been the growth in the lending market in Retail Banking services.
• Deposits: a growth of 2% is observed. The reason is a strong growth in deposit transactions. 
• Debt Funding: a decrease of 5% is observed in debt issues. Reason had been foreign exchange transactions and lower funding needs in wholesale market.
Barriers to entering the sector
• heavy competition
• large requirement of capital investment

2. Nature of the entity

Operations
Operating as a banking company, the company is indulged in providing several services like, business solutions, personal banking, institutional banking, superannuation, funds management, broking and investment services and insurance. 

Major Customers
Currently the company serves customers amounting nearly 17.4 million. This group consist of every customer segment, be them individuals, businesses, young, citizens, migrants, corporates, etc. The customers are served through both online and offline modes.

Is the client heavily dependent on any specific customers or class of customers?
There is no direct reliance on any particular customer group or customers. The company has different products and they cater the needs of all kinds of customer. Although currently in this 17.4 million base of customers, the share supporting the highest is the migrant and youth segment. Also, approximately the company’s 7 million customers are using online modes completely.


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  • Uploaded By : Alex Cerry
  • Posted on : March 20th, 2019

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