in brief
Working with credit
Favourable future
t n i
Hi muil*
What's NewS Issue 4 June/ July 2000 I
During the week of 8 May, several
members from our Latin American
offices put their heads together in a re-
gional credit course hosted by Rabobank
Brazil. Led by a representative of Finan
cial Projections, a company providing
courses on International Training and
Consultancy, the 5-day intensive event tar-
geted our commercial and credit people
involved in organizing or appraising com
plex deals for large corporate elients.
Main objectives of the course were: to
gain a deeper understanding of risks re-
garding debt priority when proposing
transactions in a number of group finan-
cial structure situations; to take a practi
cal approach in structuring complex deals,
identifying key risks; and to understand
the purpose/need of financial covenants in
documentation in ways that are consistent
with commercial objectives and logical for
the borrower's business and nature of the
facility. Special attention was also given to
detecting distortions when defining tangi-
ble net worth, borrowing, EBIT and cost
of borrowing. Using real cases of
Rabobank's elients in South America as
example, participants tcstcd and learned
the course objectives. 'There was a higher
level of participation than I have experi-
Credit classmates: back, from left - Hans Wortelboer, Maria Eugenia Bendek, Frank van Straalen,
Claudia Benavides, Shayra Williams, Erik Peek, Carlos Ortiz, Otmar Plee, Adolfo Bay, middle -
Abelardo Marcondes, Stewart Crinchton (course trainer), Maya Yonehara, Juan Pablo Reitze, José
Mafra de Camargo, Jan van den Ende, Carlos Oudendijk, seated in front - Henrique Costa and
José Eduardo Guilger
enced in the other courses I have at-
tended,' says Jan van den Ende, Sao
Paulo's F&A relationship manager. 'In an
intense and concentrated atmosphere, we
improved our knowledge of implementing
a structured approach on deals, and our
skills in identifying and prioritizing busi
ness, financial and structure risks. Subse-
quently, our expertise in protecting the
bank against risk was sharpened. These
critical skills will benefit all the partici
pants in the credit course - which im-
proves the risk profile of the organiza-
tion.' Representatives from Brazil,
Argentina, Chile, Cura^ao and Mexico,
joined by credit officers from RI's San
Francisco and Utrecht offices, attended
this educational and stimulating event.
Per 25 May, Rabobank Tokyo has been
granted an official banking license. It's
been a long process, beginning two and a
half years ago with the opening of the rep
resentative office. The securities branch
opened in December 1998, and shortlv af-
ter an application was filed with the
Japanese Monctary Authorities. But two
factors stallcd the granting of the license:
a one-year mandatory waiting period for
new offices and a stop by the Japanese au
thorities in the issuing of new licenses due
to Y2K worries. 'Before we can take full
advantage of the opportunities the license
will present, there are still several things
that need to be done,' explains Freek
Hoek, Japans country manager. 'Restric-
tions require that we obtain a Japanese
government bond dealing sub-license, a
i s
sales representative au
thorization and open
an account with the
Bank of Japan.' It will
be late August when
the official banking
branch will open its
doors - 16 staff mem
bers from the existing
securities branch will
become the new of-
fice's team. 'Opening
the banking branch
will increase market
standards and level of
commitment within
the Tokyo office,' says Hoek. 'We'11 be
able to benefit from the large capital base
of the organization, and the current 10%
i i t t r* 517 r it'/
Positive developments in Tokyo:
a look at the new banking license
withholding tax on off
shore funding will be
lifted. Therefore, by sim-
ply conducting business
the way we've been doing
it we can lock-in an addi-
tional profit of EUR
500,000 per month.' The
2000 budget for the
banking branch is set for
FiUR 15 billion. And
that's only the beginning
- the banking license will
enlarge Tokyo's customer
base and increase the
product range and vol
ume forecast for treasury and money mar
ket products. 'We're looking at a very
promising picture in Tokyo.'
