Methods for evaluating the effectiveness of commercial bank branches

Dmitry I. Aslanov, Elena P. Smolina, Evgeny T. Antonov, Marina I. Golubova and Omer Allagabo Omer Mustafa
Additional contact information
Dmitry I. Aslanov: Moscow Credit Bank
Elena P. Smolina: Moscow Credit Bank
Evgeny T. Antonov: Division for Development of Foreign Economic Partnerships of the Department of Settlements and International Financing of Sberbank
Marina I. Golubova: FGAOU VO North Caucasus Federal University
Omer Allagabo Omer Mustafa: Sudan Academy for Banking and Financial Sciences (SABFS-Sudan)

Economic Consultant, 2023, vol. 4, issue 4, 29-42

Abstract: Introduction. The topic is relevant, because the increasing number of commercial banks and financial institutions, as well as technological development, makes competition in the financial market increasingly fierce. Modern customers expect high-quality service and quick access to financial services. Moreover, assessing banks’ effectiveness in digitalization is essential for understanding how to better integrate traditional and digital service channels. Efficiency assessment methods analyze the performance of branches, identify best practices, and help develop strategies to improve the bank’s overall efficiency. The study aims to develop a methodological approach to evaluating the effectiveness of a commercial bank branch. Materials and methods. The materials were researched in banking, finance, and economics and published in peer-reviewed journals. The rating assessment and coefficient methods were used. Results. A methodological approach for assessing the effectiveness of a bank branch is presented, based on the coefficient method combined with a point-weight evaluation system. An integral efficiency indicator is used to comprehensively evaluate the branch’s core activities. This approach serves as an effective tool for improving management quality and enhancing operational efficiency. The material reflects project work conducted at PJSC Credit Bank of Moscow while the “Evaluation of the Effectiveness of Retail Network Units” project was implemented. The proposed methodology was tested by calculating the integral efficiency indicator for one of the bank’s branches. The results revealed that the coefficients used are interrelated and accurately reflect the current performance of the analyzed branch, thereby increasing the reliability and objectivity of the assessment. Conclusion. With the transition to digital technologies and online banking, new assessment methods must be developed that consider the specifics of both traditional and digital branches. This opens up opportunities for research into integrating digital and physical service channels. Taking into account changes in the banking environment and consumer preferences, new metrics and indicators for evaluating performance must be created. This may include assessing customer experience, satisfaction level, and other non-material factors.

Keywords: commercial bank branch; efficiency assessment methodology; point-rating assessment; integral efficie (search for similar items in EconPapers)
JEL-codes: C13 G21 G28 (search for similar items in EconPapers)
Date: 2023
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