Why Banks Fail and How Implementation of SAP Operations Can Help

Without a doubt, a strong banking system is quite essential in the growth of every country. You can even ask your forefathers for this. However, not all banks end up being needed or supported thus, you will see some of them suddenly announced bankruptcy. What could be the reasons why a bank fails to gain the trust of depositors?


Are you a bank manager who is also on the verge of closing down? If that is the case, you might learn something from this article. Knowing the possible reasons why some banks fail and how it can be resolved might inspire you to reach out to those who can truly help you. So, why do some banks fail? Check this out:

1. Bad loans


This can happen a lot. Yes, the bank might have imposed strict guidelines in screening their debtors, but then again, the guidelines might not really that well-rounded. Maybe it targets a certain aspect only and thus, bad debtors still land on the banks’ favors.

2. Funding issues


Most banks if not all, invest their money on something so that they can also earn and give the promised interests to their depositors. Yes, most of the time, this aspect can fail because of general market conditions. However, there are also times when the reasons is because the investors lost faith on the said bank and thus they can’t continue with their investments anymore.

3. Mismatch of assets/liability


When the liabilities of the assets are more than the money generated, this will surely crease severe problems. One big example is when a floating rate liability funds a fixed rate loan. Because it is a fixed rate loan, it will not be affected to the fluctuations of interest rates which is not the same with the item that funded it. So, if this situation will go on for some time, the bank will surely suffer.

4. Regulatory issues



This happens when a certain bank will be blackballed by the authorities where it is under. There are a number of reasons why this can happen, but the bottom line is, the bank will really be negatively affected.
If any of the situations above will possible happen to your managed bank, you already know what will be your end. This is why; while you still have a chance, you have to overhaul your baking systems and let RPA Partner Malaysia back you up. The software can surely enhance the systems of your bank for the better.

This video shows what it is like being a partner with SAP:

This comes with the SAP BW/4HANA template that can do wonders to your website. You can learn more about this if you will check their page. One thing for sure though, if a skilled SAP consultant will try to implement the SAP BW/4HANA software to your business, you will say goodbye to the traditional BI that is not enough for today’s trends.


Yes, you have to be strategic if you want your business to stay afloat. You don’t need to end up with those who fail as there are experts who can help.

Jo Johnston

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