Alpen Bank Memorandum

Date: January 22, 2015

To: Gregory Carle
From:
Subject: Feasibility Analysis for Romania Credit Card Launch
Recommendation
Alpen should enter the credit card business in Romania. A quantitative analysis was completed
to assess if Alpen Bank could earn a profit of $5 million Euros in 2 years by introducing a credit
card in Romania. If this profit was added to Alpens consumer bank segment within the 2 year
time frame it would prove feasible. Based on my calculation (evident in Appendix A), Alpen
Bank will earn $5 million Euros just shy of 19 months by targeting their affluent customer base.
Positioning
The credit card should be positioned as a high end premium product marketed toward the
affluent class because:

Alpens existing customers belong to the affluent class;

Easier to establish itself in this market;
The affluent class represents the top 10 % of the population which has about 24% of the

wealth;
Affluent customers are conscious of their image, less price , and will use credit cards

more frequently;
Less risk of default.

Basis for recommendation

Targeting the affluent market segment is the best strategy because:

Alpen can acquire enough customers to reach 5 million Euros in under 2 years
Alpen can reach $5 million profit with less customers
o Only 91,532 customers needed to make 5 million Euros when targeting affluent
class versus 135,233 customers needed when targeting all customers (both

affluent and middle class).

This market segment has a higher profit potential
Appendix A