This case blends quantitative financial analysis with qualitative strategic considerations. Candidates must calculate revenue changes (driven by market share expansion post-spinoff) and cost impacts (driven by loss of shared services), then contextualize the financial benefit of USD 4.15M against organizational, cultural, and competitive factors.
Your client is a leading retail bank in a South American country, with over 3,000 branches across the country. In addition to the retail business, the bank also has an Investment Banking (IB) unit, which acts as an intermediary and/or advisor when corporations want to engage in complex financial transactions (for example M&A, raising capital, initial public offering (IPO), etc.).
The IB unit of this bank is headed by a Vice President who reports to the bank’s CEO.
This IB VP hired you to evaluate whether the IB should spin off from the retail bank, becoming fully independent from the conglomerate.