Treasury for the
REGION
r
treasury
1 11
WHAT'S NewS Issue 7 July 1996
i
The role of Singapore's current 29 treasury
sales people and traders is much broader
than generating the branch's own funding
requirements. As regional A treasury,
Karei Lankenau and his team look after the
needs of customers and other Rabobanks in
no less than 14 countries, including a number
in the Middle East.
Karei Lankenau
'To be honest,' says Lankenau,
'although we're active in a lot
of countries, we've still got a
long way to go to make the
^Rabobank name better known
Pn the Asian Pacific Rim.' Yet,
clearly the treasury team is
hard at work doing just that.
'Of the 14 countries we service
today, we would visit the more
active markets, like Thailand,
Malaysia and Indonesia fairly
often. Our less active markets,
such as the Middle East, would
be once or twice a year. But we
think that by setting up
marketing activities, we get
our name across more
actively.'
MARKET MAKERS
It is not just the name that is
being actively marketed. The
Singapore treasury is gradually
growing its range of products.
'If you look back 18 months,'
Lankenau says, 'you would
have seen us doing primarily
plain vanilla, traditional
products. That was fine then.
It suited market needs,
although some of the more
adventurous banks had already
begun to diversify their
product range. What we did
was look at what we
considered growth areas. One
was to develop a forex
capability in Asian currencies,
a capability where we can be a
more active market-maker. We
added the Thai baht,
Malaysian ringgit and
Indonesian rupiah because we
see markets in those currencies
developing very rapidly, not
least because the regulatory
authorities are increasingly
moving towards liberalization.
There is a growing appetite
among Japanese and among
American investors and
pension funds. Hopefully, our
participation in these
currencies will result in bigger
business volume in regional
trading activities which will
then be taken up by New
York, London and Utrecht.'
MORE SOPHISTICATION
In essence, what the Singapore
treasury is doing is creating a
range of products tailored to
the various markets it serves.
And as the immature and
maturing markets evolve, the
banks product range must also
evolve with equal speed. 'We're
also seeing an increasing
demand from customers for
so-cailed value added
products,' Lankenau confirms.
'As I mentioned, some of our
customers are becoming
increasingly sophisticated in
their know-how about
treasury. They are more and
more aware of the risks they
have in their balance sheets so
this represents a real
opportunity for our sales
people to offer equally
sophisticated products. I think
that our own development
over the past couple of years
has meant that sales people
have had to become more
solution oriented, rather than
simply acting as an
intermediary between the inter-
bank desk and the customer.
We're in the process of
growing that orientation to
provide the kind of added
value customers demand now.'
MANAGING RISK
Not surprisingly, the treasury
team works hand in glove with
the commerical people and, of
course, international private
banking colleagues. 'Actually,'
says Lankenau, 'we approach
the private bankers as if they
were clients.' There is real
synergy between treasury and
account managers. 'That is
certainly growing,' Lankenau
confirms. 'You see a clear
commitment on both sides to
understand what the other is
doing and how we can put
those activities together.'
Good product development
must take account of many
factors. 'Risk management is a
major priority,' adds
Lankenau. 'As the so-called A
treasury in the region, we are
allowed the take the market
risk for more sophisticated
treasury products like
derivates. That means other
treasuries, such as Sydney,
Hong Kong and Jakarta, come
to us for products. In that
respect, we've actually
developed a very satisfactory
cooperation with Utrecht for
currency options. We use the
Utrecht trading book as the
risk management kit. All the
risk is transferred to the
Utrecht book through highly-
sophisticated IT systems. It is a
really solid solution for high-
risk products.'
MAJOR EXPANSION
Fixed income and derivatives is
another major development
within the Singapore treasury.
A senior specialist in this field,
Michael Bass, has recently
been recruited. 'He'11 be
running positions in interest
rate swaps, cross currency
swaps and both swap and
interest rate options,' says
Lankenau. 'His arrival
represents the first step
towards major expansion.
Within the next three years, we
will be looking to grow that
"team" from the current one
person to eight. Our aim is for
this team to contribute 40
percent of the total treasury
budget by the year 2000.'
TREASURY
Singapore heeft één van de zogenaamde A Treasuries. De treasury is actief voor de kantoren en klanten in 14 landen. Er wordt
gewerkt aan een grotere naamsbekendheid en het kunnen leveren van meer sophisticated producten.Tegenwoordig treedt
Singapore op als market maker in de Thaise Baht, Maleisische Ringgit en Indonesische Roepiah. De markten in deze valuta ontwikkelen zich snel en
zullen naar verwachting voor een groter zakenvolume zorgen.
