I.

TITLE OF THE CASE:

GOLDEN OPPORTUNITY COMMERCIAL BANKS

II. TIME CONTEXT:

October 2008

III. PERSPECTIVE/VIEWPOINT

New Management of Golden Opportunity Commercial Banks

IV. STATEMENT OF THE PROBLEM

How can Golden Opportunity Commercial Bank deal with their unstable status?

V. STATEMENT OF OBJECTIVES

To recover the loss at 5billion by requesting a loan from BSP which carry a lower
interest rate and fees, payable in 10 years time.

VI. AREAS OF CONSIDERATION

STRENGTHS
• GOCB was very innovative company which can easily adapt changes happen in the
society to satisfy and meet the customer’s needs.
• Expanded in the areas in trading bond and stocks
• Offer its stockholders a safe and profitable vehicle in for investing and lending.

WEAKNESSES

• Heavily relying on the inter-bank loans granted by RCB to cover its overdraft
• The bank had incurred recurring overdrafts in its demand deposits with the BSP.
• Officers who took advantages of their positions.
 OPPORTUNITIES

• The bank teamed up with the GRC and entered into guarantee agreement with the
HGC.
• Emergency loans
• Finance GOCB to recover from losses.

THREATS

• Monetary loss
• System glitch
• Fraud

VII. ALTERNATIVE COURSES OF ACTION

ACA 1
Downgrade Company status

Advantage: Reducing the status from commercial bank to thrift bank because thrift
bank has lesser requirement compared to commercial bank

Disadvantage: higher risk

ACA 2
Loan from other financial institution

Advantage: Ability to obtain a large amount of money quickly that can be used for
purchases and investments

Disadvantage: Borrowers with bad credit can likely only attain a loan at higher
interest rates.

ACA 3
Negotiate with your creditors
 Advantage: Most creditors are willing to negotiate a settlement so that they receive a
portion of their money, instead of losing everything

Disadvantage: Requires the agreement of all creditors.

VIII. CONCLUSION

CRITERIA ACA1 ACA2 ACA3

Risk Involve 3 1 2

Additional Investment 2 3 1

Practicability of the 2 1 3
Implementation
Total 7 5 6

Legend: 3 being the highest, 1 the lowest

IX. RECOMMENDATION

We highly recommend the Alternative Course of Action 1 which is to Downgrade

the Company Status because it has the highest probability rate of 7 among the three
given ACA.

X. PLAN OF ACTION

Activity Person/s Responsible Time Frame

All-important holiday shopping
season is expected to be low on
cheer this year for retailers who Bank Analysts Continuous
usually generate up to 40% of
their annual revenues in the
months leading up to Christmas.
The newly passed Socialized and
low Cost Housing Loan
Restructuring Law will cover all
socialized and low-cost housing
loans from government financing Bank Analysts Continuous
institutions and agencies with at
least 3 months of unpaid monthly
amortizations, and of which the
original principal amount does not
exceed P2.5M.