Performance and Productivity Management In Banking Sector

01.   Introduction

 

Banking Sector in Sri Lanka

The banking sector in Sri Lanka, which comprises Licensed Commercial Banks (LCBs) and Licenced Specialised banks (LSBs), dominates the financial system and accounts for the highest share of the total assets in the financial system. Banks play a critical role within the Sri Lankan financial system, as they are engaged in provision of liquidity to the entire economy, while transforming the risk characteristics of assets.

Banks also engaged in providing payment services, thereby facilitating all entities to carry out their financial transactions. On the other hand, banks can create vulnerabilities of systemic nature, partly due to a mismatch in maturity of assets and liabilities and their interconnectedness. Therefore, the soundness of banks is important, as it contributes towards maintaining confidence in the financial system, and any failure may have the potential to impact on activities of all other financial and non-financial entities, and finally the economy.

In terms of the asset base and the magnitude of services provided, the LCBs are the single most important category of financial institutions within the banking sector. LCBs dominate the financial system with the highest market share of the entire financial system's assets. Therefore, the health of Sri Lankan financial system depends to a large extent on the soundness of the LCBs, primarily on the performance and financial strength of the six largest LCBs, generally referred to as the Systemically Important Banks (SIBs).

The systemic importance of the LSB sector is relatively low in comparison to the LCBs, both in terms of size and their impact on the financial system, as it does not play a major intermediary role in the payment cycle.

 

Licensed Commercial Banks in Sri Lanka (As at 30^th September 2021)

 Amana Bank Plc

Bank of Ceylon

Bank of China Ltd

Cargills Bank Ltd

City Bank N.A.

Commercial Bank of Ceylon Plc

Deutsche Bank AG

DFCC Bank PLC

Habib Bank Ltd

Hatton National Bank PLC

Indian Bank

Indian Overseas Bank

MCB Bank Ltd

National Development Bank Plc

Nations Trust Bank PLC

Pan Asia Banking Corporation PLC

Peoples Bank

Public Bank Berhad

Sampath Bank Plc

Seylan Bank Plc

Standard Chartered Bank

State Bank of India

The Hongkong & Shanghai Banking
Corporation Ltd (HSBC)

Union Bank of Colombo PLC

 

Licensed Specialised Banks in Sri Lanka (As at 30^th September 2021)

Housing Development Finance
Corporation Bank of Sri Lanka
(HDFC)

National Savings Bank

Pradeshiya Sanwardhana Bank

Sanasa Development Bank PLC

Sri Lanka Savings Bank Ltd

State Mortgage & Investment Bank      

       https://www.cbsl.gov.lk Accessed on 08.05.2022

01.2

Different types of business banking services include as follows:

·         Loans (Business/ Personal)

·         Savings Accounts/ Current Accounts/ Term Deposit Accounts

·         Mortgage Services / Overdraft Services

       Debit and credit cards.

·         Merchant services (credit card processing, reconciliation and reporting, check collection)

·         Treasury services (payroll services, deposit services, etc.)

 

 

01.03

Perfomance and Productivity Management in Banking Sector.

The process of creating and maintaining a productive and efficient work environment where employees can fulfill their full potential call performance and productivity management.

Engaged employees stay longer, actively involve themselves in the workplace and produce better results.

The organizational leaders are burning the midnight oil to enhance the ability of the firm to provide quality products or services to their customers at a competitive price in the marketplace local and global.

The banking sector fully believe in the management of performance and productivity as two key drivers which if leveraged properly will enhance overall organizational ability to be competitive in the economy. 

It is also a well-established fact that the management of performance and productivity not only helps increase organizational competitiveness but also add to the economic growth of the country.

HRM practices namely recruitment and selection, training and development, compensation, and performance appraisal practices positively affects the innovation capability of an banking sector.

 

 

Reference

Singh, S.K., Burgess, T.F. and Heap, J. (2016), "Managing performance and productivity for organizational competitiveness", International Journal of Productivity and Performance Management, Vol. 65 No. 6. https://doi.org/10.1108/IJPPM-05-2016-0090 Accessed on 08.05.2022