Stress and challenges in today’s branch banking
Every employee of an organization is responsible for shouldering some duties associated with his position in the job. The incumbent is remunerated accordingly for discharging the duties commensurate with his position in the job. The higher the position, the superior the duties and responsibilities. The superior the duties and responsibilities, the bigger the remuneration, honour, power and motivation. That is, positions in the job define duties and responsibilities as well as symbolize recognition, status and financial solvency.
A branch banker of today has to give more than he gets in return from his profession. A branch banker has to be custodian of public money of crores of taka and undertake financial risks every moment. As a result, many branch bankers have to endure high blood pressure, hypertension, cardiac diseases and many other physical and mental hazards.
Of course, there are some sorts of compensations for additional duties of a banker. So let's see how bankers are compensated for many such extra job responsibilities, personal sacrifice or loss in profession. Let's consider a manager's case. A branch manager is compensated by a charge allowance of one or two thousand taka based on the business size of the branch.
Though this allowance might be two or three thousand taka more for upper grade branches, it never signifies a proportionate relation between a manager's responsibilities and his 'pay'. This 'pay' doesn't necessarily mean 'monetary pay' always. It also includes many nonmonetary benefits and facilities like on-time promotion, appreciation and reward, justified business targets, congenial work environment, sufficient manpower proportionate to work volume, logistical support, etc.
At present bankers are far behind from getting their nonmonetary benefits and facilities. These are not my whimsical sayings. Such findings have been revealed in a recent study by Bangladesh Institute of Bank Management (BIBM). According to the study, 99 per cent bankers sustain occupational stress in their job! Only 1.0 per cent bankers are stress free in their job. Out of the 99 per cent stress enduring bankers, 35 per cent bankers are in 'severe' condition. This is alarming for banking as a profession of the future.
From the regulator's point of view, banks are 'service institutions' where 'profit' comes second; but from the bank owners' point of view, banks are both 'service institutions' as well as 'for-profit institutions' where 'profit' comes first. But it is true that, for making profit 'service' must be maintained to its best art and quality. This dual orientation puts the bankers into a state of dilemma, because a number of bank services which the bankers are bound to perform and which swallow bankers' service time to a good extent has no direct contribution to profit.
Though it sounds bad, it's a bitter truth-today's branch banking can be compared with a deep and turbulent ocean, where the branch manager along with his subordinates is thrown into with everyone's hands and legs fastened together tightly with the chain of manifold business targets and asked to reach the beach by swimming despite being captive gathering handful of pearls-desired profit, deposit, advance and so forth.
In addition to making hefty profit, challenges of mounting default loan recovery, retaining and procuring deposits at a frustrating marginal rate of interest have been added to. Acute Manpower scarcity and logistical breakdown are the universal problems of many branches. Despite such constraints, branches must grab the much-sought-after businesses for the bank satisfying each and every customer.
For becoming a successful branch banker in terms of achievement in comparison with targets set by the higher authority, a banker has to be super charismatic or must have the touchstone or Aladdin's Lamp of miracle at his hand. But, in reality, no monster with Aladdin's Lamp of miracle appears to rescue the manager drowning with his team members.
Though banking is purely a service sector, lofty targets are benchmarks against which branch bankers' performances are compared with. But, if there is a flaw in setting the targets, performance doesn't get its true judgment. When the targets are unrealistic and unachievable, then a true performance is sure to be misjudged. Budgets and targets set by the branches are seldom accepted by their banks. Rather banks are seen to set targets for branches with a growth rate up to 200 percent and even more (!) though the national economic growth rate is around 8 percent only.
In these targets clear aggression is encouraged for income and profit. As a result, performance remains far behind targets. Consequence is-- a performance having 50 per cent growth over last year is treated as non-performance; and a performance even with 80 per cent growth doesn't get the recognition of good performance, since it doesn't meet the target!
For achieving such geometric profit growth, many managers go reckless for expansion of loans overnight, which tends to mounting up of non-performing loans. And, after three or five years the subsequent managers keep racing after the defaulters and sustain the injury of prolonged recovery disease.
So it seems to me, by performance in today's banking is supposed doing something impossible. Such impossible targets destabilize the mental peace of the manager since he always lags far behind the targets; and thus suffers from inferiority of nonperformance or underperformance. And at this plea of unachieved targets, managers are rebuked very inhumanely and made deprived of due promotions, financial incentives, leaves etc. In many cases managers are not allowed to leave the job station even on holidays.
Bangladesh Bank should look at this matter of setting business targets by the banks. It should take initiative so that no banks can impose business targets on branches with growth rate more than 20 per cent. It will help bankers live a little bit comfortable lives and also rein the unhealthy cut-throat competition among banks.
Another prime duty and grave concern for a banker is deposit mobilization. Bankers have to procure deposit, but at no or low cost. They have to lend money, but no loan can be defaulted; deal with money, but without any accounting errors and without any fake notes; deal with documents but without any forged ones.
For any cash shortage, branch bankers' pocket is debited. Aggrieved defaulted borrowers are also seen to file suit against the bankers in reply to bank's suit against them. Bankers of the branches always remain tensed lest any robbery of the vault occurs or customers' account fraud be compensated by debiting bankers' pocket. There are also examples that branch bankers had to sacrifice lives while protecting depositors' money at their custody.
Bangladesh Bank's empowerment to customers encourages them to complain even on ignorable and unscrupulous issues not logical and supported by banking norms. This too much authorization to customers keeps the bankers feared of unexpected complaints triggering disciplinary actions from the top authority. Because when a complaint is lodged it acts as the trump card to rebuke a banker. 99 good jobs of a banker are buried by one complaint against him, even if the banker truly has no contribution to the complaint.
The more Bangladesh Bank is vocal for depositors' interest, the more it seems to be silent about the interest of the bankers. It always shows zero tolerance to customer complaints, and advocates for the highest customer service and interest. But its role in protection of bankers is meager. New services are being added to banking rapidly; reporting and compliance issues are getting monstrous day by day, accompanied by hilly business targets. But "too much work, too less manpower" has become the bitter truth for bank branches. Bangladesh Bank seems to be little concerned about it; little concerned about work load, long stay at office, working on holidays, non-payment of incentive bonuses, non-payment for overtime, deprivation of promotions, etc of bankers.
Loyalty to bank owners' will, subjection to political powers are the known but uncontrollable fate of bankers. Haunted by the fear of Anti Corruption Commission (ACC), branch bankers can't stay relaxed even after successful retirement, lest any past unwillful and unknown scams come to light and he is handcuffed to the jail!
The regulators of the banking sector and guardians of bankers have to address all these issues to find out curative as well as preventive measures in no time. Otherwise, if the bankers do not get sound, the broken-health banking sector will surely meet its premature death, which will be devastating for the economy of the country.
The writer is banker