Great Western Bank
Practice this intermediate profitability case interview question in the Financial Services sector. Includes detailed problem prompt, clarifying questions, structured framework, and expert recommendation. Part of ProHub's 835+ consulting case library.
ProHub Comment
This case tests quantitative analysis of a profitability problem requiring candidates to diagnose root causes using financial data (revenue decline driven by interest rate compression), then balance short-term cost-cutting with customer retention risks revealed through market research. The case emphasizes that naive cost-cutting without understanding customer economics can destroy more value than it saves.
Estimated Time
26 minutes
Difficulty
Medium
Source
ICC
50
/ 100
Our client is a small retail bank in the United States called Great Western Bank (GWB). GWB has 50 branches across the Western United States. In the past two years, the company has experienced a decline in profitability, and their CEO has sought our help to identify the root cause for the decline and see if we can help GWB address the problem. How would you advise the CEO?
Clarifying Information
- As a retail bank, GWB provides checking and savings accounts to members of the public, rather than companies. It then uses these deposits to make loans, also to individuals.
- GWB generates revenue by making three types of loans: mortgages, auto loans, and personal loans. The bank’s assets are evenly allocated across these types of loans and its Central Bank reserves (i.e. 25% in each of the four categories).
- Profitability has fallen by $34M over the last two years.
- GWB has approximately 300,000 customers and $4.4B in interest-bearing deposits