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Hard Revenue Growth

PSU Bank Co.

#Financial Services
ProHub Comment

This is an interviewer-led revenue growth case requiring the candidate to diagnose why PSU Bank's mutual fund AUM is growing at 3% versus the industry's 8%. The case tests framework-building, data interpretation, and brainstorming skills through progressive disclosure of exhibits showing distribution channel performance gaps, competitive benchmarking, and sales team incentive issues.

Estimated Time 15 minutes
Difficulty Hard
Source Wharton
50 / 100
PSU Bank Co. is a public sector bank and their mutual fund division has not been doing well recently. The CEO wants your support in identifying the reasons for the same and wants you to help her solve the problem. The division pools invests money of investors in a diverse set of stocks to achieve good returns.

Clarifying Information

  1. Geography - The client is a US-based bank with $70 Bn in AUM.
  2. Competition - The industry growth rate for last two years has been 8% whereas the client has been growing at 3%.
  3. Business - You can assume AUM to be similar to sales in a traditional firm. The mutual fund division gets a small fee in exchange of managing the money of volunteering investors.
  4. Objective - The AUM (assets under management) of the Mutual Fund is the total amount of investor’s money that the company manages. The AUM has not been growing fast enough as the firm has not been able to attract more investments. Objective is to find the reasons for this.