Cr»
Administration DIVISION
CORPORATE BANKING -
STRATEGY FOR GROWTH
credit division
10
WHAT'S NewS Issue 2 Febrjary 1996
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CREDIT COMMITTEE
INPUT
The credit analysis team is very
involved daily with account
managers and clients. Analysts
also attend London Branch's
own credit committee on a
regular basis. 'This is a useful
practice for both the analysts
and the Credit Committee,' says
Cunningham. 'A credit analyst
usually acts as secretary to the
committee. We don't want to
overburden people, so we
normally appoint two analysts
to share the credit secretarial
work for a six-month period. I
know they sometimes see it as a
chore. But both Mary, who is
more like a partner than a
depury and is a full-time
member of the committee, and 1
believe the analysts gain really
good insight and experience into
how proposals are evaluated.
Ultimately, it helps them do a
better job.'
CLOSER TO THE LINE
On the administrative side,
Gordon Harris and his team
are responsible for processing
and handling both credit and
loan transactions. 'This means
putting the deals on the books
and then booking all of the
transactions that happen
within those deals. Gordon's
group is very experienced,
many of them have been with
us for three or four years,'
Cunningham says. 'In some
banks, this might be part of
"operations". But our
structure puts them just that
bit closer to the line, to the
account officer. We think it
not only works extremely well,
but is extremely important for
cooperation between the
various teams.'
LONDON'S LEGAL
EAGLES
The Branch currently has a
two-person legal unit. 'That's
Christine Hogg, who has been
with the bank for almost three
years, and Ton Rottjers,'
Cunningham continues. 'He
came over from Utrecht nearly
two years ago. This kind of
support, also the Dutch legal
insight Ton brings in, is really
essential with the kind of inter-
network deals we're doing
here. They report directly to
Gijs van der Schrieck and are
crucial members of the branchi
team and make a real
contribution to what we're all
trying to achieve here - better
results for the branch, but also
for the whole network.'
Backing up the growth in product range and complexity is a team of
40 in the administration division who manage all aspects of the
infrastructure of the Branch through from premises to computing to
the settlement and accounting for the deals. New head of
administration, lan Armour, says,'I inherited a strong, experienced
team, some of whom have been here since the day the Branch
opened.The goal is to continue developing our skills and capacity to
keep up to speed with the changing demands of the business.'
SAFE HANDS
Over the last six months, the Facilities and IT groups have managed the
construction of a new 36-position dealing room with state-of-the-art
systems. Now, they are focussed on raising thequality of services
throughout the Branch. Administration managers are fully integrated
into the business and are keenly aware that an efficiënt and
professional support team with 'safe hands' is essential to maintain the
confidence of marketers. This is crucial to support the marketers when
they go out to get business,' says Armour. 'But it also reinforces the
professional image of the branch in the marketplace.'
With margins under extreme pressure, London Branch's
corporate bankers have been obliged to come up
with fresh strategies to beat the squeeze. David McWilliam
puts us in the picture.
David McWilliam
'We're looking at a situation
here,' he says, 'whereby
margins have fallen by
anything from 30 to 50 percent
last year in comparison to what
we were seeing the previous
year. Instead of getting around
30 basis points from quality
corporates, we're now getting
about 15. What that means in
practical terms is that you have
to do twice the volume of deals
to get the same basic level of
income and fees.'
HIGHER VALUE
ADDED
That is the bad news, but
McWilliam and his team have
made their own good news.
'The nice thing is that we
anticipated this,' McWilliam
confirms. 'The squeeze on
margins meant we had to alter
our approach to our cliënt
relationships. We recognized
that and also the fact that we
needed higher added-value
products. So the bank made
real investments in areas that
could generate those products,
such as structured finance,
mergers and acquisitions,
securitization. And it has
started to happen for us. We
started to get the kind of
business we want, particularly
in the last six months.'
TOO MUCH MONEY
Yet, the corporate bankers are
still faced with how to
continue to add value. 'Our
results last year were generated
by pure relationship-driven
income, with the lion's share
coming from interest income,'
he says. 'But as I said, there is
a real decline in average
margins, not least because
there is too much money and
not enough real demand for it.
Plus, no one is actually
investing any money. They are
all turning over existing
borrowings. I'd be very
interested to see the quality
statistics on what is really a
new deal and what is not.'
KREDIETAFDELING
De kredietafdeling is een integraal deel van het kantoor en wordt niet gezien als aparte 'back-office'. Daarom functioneren de
kredietanalisten bij toerbeurt een periode als secretaris van de kredietcommissie. Hierdoor krijgen zij een beter inzicht in de manier
waarop kredietvoorstellen worden geëvalueerd, zodat zij bij het opstellen van hun rapporten hierop kunnen inspelen. De kredietadministratie,
verantwoordelijk voor het administreren van de leningen en alle transacties die hieronder plaatsvinden, is ook in deze afdeling ondergebracht. Door
deze structuur worden kortere lijnen en een betere samenwerking bereikt.
