Human capital in commercial banks: development trends and problems of management in the unstable economic conditions

Abstract

The Latvian economy has undergone a number of various changes in the last decade. The early 2000’s were associated with a moderate economic progress. Active economic growth observed within the period 2005 to mid-2007 against the background of emerging global financial crises then changed into a sharp decline and in 2008 already the Latvian economy entered the stage of crisis that lasted until the end of 2010. Nowadays the Latvian economy is overcoming consequences of the crisis, which leads to new the emergence of new specific features in operations of the banking system and, in turn, puts forward new requirements towards personnel of the local banks.

Changing trends in the banking sector are accompanied by changes in requirements towards knowledge and skills of the banks’ employees. At present, the banks demand not only qualified sellers of their products associated with management of the customer’s assets, financial consulting, investment business etc., but also the employees possessing knowledge and skills in the field of credit monitoring, financial analysis, risk management. Saturation of the market with highly skilled specialists must be closely connected with enhancement of the training process in higher education institutions.

The research is dedicated to the analysis of the employees’ movements in the banking sector, setting new requirements for personnel in the banks, as well as examining the personnel management policy in the Latvian commercial banks. Based on the summarized statistical information and the analysis of the questionnaires obtained from surveyed HR Departments, there specific recommendations to enhance the training programmes for the Latvian institutions which educate financial and banking specialists are worked out, as well as the suggestions how to enhance the efficiency of personnel management in the commercial banks.