Bank Crisis Management Strategies for Leveraging Effective Performance of the Barbados’ Banking Institutions in Times of Crisis

Abstract

Given a series of turbulences and disruptions that most of the financial institutions in the Caribbean faced in recent years as a result of the 2008 financial crisis, Hurricane Dora, Covid-19 and now the Russia-Ukraine War that induced energy shortages and inflation, this study uses integrative review to evaluate bank crisis management strategies that can be adopted for leveraging effective performance of the Barbados’ banking institutions in times of crisis. To accomplish that, the integrative review of different studies was structured according to five steps encompassing the designation of integrative review objectives and questions, literature search, inclusion/exclusion criteria, quality assessment and data synthesis. In crisis times like during Covid-19, outcomes of integrative review indicated the Covid-19’s devastating effects on the performance of most of the banking institutions in Barbados to have been reflected in the declining deposits/savings, new clients' borrowings and loan repayments. Covid-19 also instigated an increment of non-performing loans and the bank’s market disconnectedness, whilst also undermining the implementation of growth-improvement plans and strategies. As profitability and liquidity crises set in, findings revealed Covid-19 to have disrupted the bank’s seamless operations, as declining bank personnel’s morale, motivation and commitment also affected their performance. To improve the banks' future resilience, most of the reviewed theories and literature proposed the best bank crisis management strategies like the adoption of contingency planning to improve the bank’s future resilience. Besides dedication of reserve resources for managing and mitigating the disruptive effects of unpredicted events, others suggested the essence for the encouragement of a culture of change, flexibility and agility. However, some of the reviewed studies argued that no best bank crisis management practices and strategies emerged from Covid-19 crisis management that can be replicated for managing such similar complex crises in the future. This implies as the banks were significantly overwhelmed by the Covid-19 shocks, it was not practically possible for them to think and rethink to emerge with the immediate best bank crisis management strategies that can be emulated going into the future. Since this suggests most of the banking institutions in Barbados must still explore the best crisis management strategies that can be adopted to improve the banks’ future resilience to withstand all shocks, the study concludes with the suggestion of the Systematic Bank Crisis Management Framework that the banks can adopt going into the future.