Some Considerations On Evaluation Criteria Of The Territorial Network Of Credit Institutions

Business environment requires credit institutions to build up a network of branches, agencies and offices covering all areas of the country and allow an active partnership and direct involvement in mobilizing savings temporarily available and placing them under conditions of high efficiency and minimum risk. There were times when the territorial network of credit institutions has expended noticeably from year to year, but since 2010 the reflux time has come and many agencies and branches of credit institutions had been closed. In one case or another, selection criteria is required and the assessment of past, present and future performance is needed. The economic, financial, commercial, social and ethical criteria are discussed in this study, meant to offer a better understanding of how to prioritize the territorial components developed by credit institutions. From an economic perspective, the main criterion is the efficiency of each territorial component embodied in productivity, profitability and profitability indicators. From a financial standpoint, the hierarchy of territorial network has as the main criteria the quality of assets (embodied in the overall risk ratio, the share of overdue and doubtful loans, provision coverage ratio and coverage ratio of non-performing loans and investments) and liquidity (embodied in the liquidity indicator, immediate liquidity and credits - deposits report). In terms of trade, market studies are considered so to reveal potential opportunities of the area versus bank’s possibilities, banking services rate of coverage in the territory, complex marketing strategies and policies, human resources, regional development etc. Ethical and social coordinates also prove to be important in the design of banks’ territorial network as they can give a better image to the credit institution and can turn into an important pillar for bank’s credibility, which are both indicators difficult to measure but very important to encourage the performance of credit institutions. Performance evaluation and ranking of subunits that are part of the territorial network and represent a vision of creating profit centers can make an important contribution to motivate staff and increase the overall performance of the credit institution.