The Agricultural Bank of Mongolia

This document presents the case study of The Agricultural Bank of Mongolia. It states that the Agricultural Bank of Mongolia (Ag Bank or XAAH) is the main provider of financial services in the rural areas of Mongolia.The document analyzes following aspects of the Ag Bank:

• Implementation process;
• Objectives;
• Political issues faced by the bank;
• Staff culture;
• Brand image and product strategy.

• It highlights that:
  • One of every two Mongolian households uses Ag Bank;
  • In February 2004 the total portfolio outstanding was US $49 million;
  • Ninety percent of all Ag Bank lending is made in rural areas;
  • Ag Bank paid US $2.9 million in income taxes in 2001, 2002, and 2003 combined.
• The document concludes with a list of lessons learnt by the Ag Bank:
  • Management must be politically independent and qualified;
  • Staff requires training, incentives and protection from political pressures;
  • Financial intermediaries can profitably service low-income markets;
  • Meeting client's financial services needs has a positive economic impact;
  • State-owned banks can be turned around.