ASSIGNMENT

Assignment



Assignment

Introduction

The banking sector in Chile registered good growth in the first half of 2011. Combined 2011 first-half net profit for Chilean banks and financial institutions rose by 6.5% over 2010 to a consolidated $2.02 billion. This was on a strong base of 50% growth registered in the first half of 2010 over the first half of 2009.Total loans in the first half of 2011 were CLP79.00 trillion, up 9.5% from the same period 2010. First-half consumer loans totalled CLP10.49 trillion, up 13.4% from the first six months of 2010. Banco Santander-Chile is the largest bank in Chile by total assets. With its leading market position, the bank is well positioned to harness the potential of growing banking industry in Chile (Matthias 2008, 58).

Strategic Positioning of Santander Bank

Porter's Five Forces

We can make an analysis of the external environment of Santander Bank through the Porter's five forces model. From this model we can see that competition in terms of suppliers is very high; therefore, the bargaining power of suppliers affect the environment of Santander Bank. As the competition is very high and there are many other Banks; therefore, clients have the option to go for others. New Banks are entering in the market bringing threats for the company. Because of new entries in the market, Santander is afraid of the arrival of substitute for their in the market. There is a very high chance of arrival of substitute banks in the market. Competition is increasing in the market day by day and the competitive rivalry is increasing for Santander Bank (Raphael 2000, 25).

PESTLE Analysis

Political Factors

The main political factors associated with the Santander Bank are as followed. The local authority support for the charity is declining continuously. There is a great potential of withdrawal preceding the changes in the political control. There is also lack of coordination in the charity agenda. The political factors have greatly influenced the regulation of charity (Thomas 2008, 20).

Economic Factors

There are some economical factors which can affect the Bank of Santander. These are the factors through which the purchasing power of the potential clients is affected. The economy has low inflation rate which is considered as the benefit and good sign for the companies. The rate or inflation has decreased to 1.3%. Another good factor for Santander Bank is that the unemployment rate is very high and; therefore, the rate of spending is also high. This is a very good sign for any Bank who wants to start its business. It is calculated that the GDP of the country is also increasing at an accelerated rate and which is also increasing consumption level of customers.

Social Factors

In South London, the access of the Internet is growing day by day. Statistics show that almost 29.8 million households have access to the Internet. This ratio increases the trend of online buying and marketing, which could be helpful for the Santander in a sense that they can start their online marketing campaign. It is estimated that almost 99% of people spend ...