regional focus
The US model
6 What'sNewS Issue 1 January/February 2001
*- Probably because the region is a new
concept in RI, and we're still learning how
to do it well.
How willyou know when you've been
successful?
When we see a lot of traffic on
those bridges. And if we want to
get where we want to be, we
need much more traffic, much
more interaction with the other
regions, many more cross-border
deals. We want to see each office
generating 5 million euros per
year bottom-line. I have asked
each country GM to determine
whether that's feasible over the
next couple of years (with per-
haps one or two exceptions
where we should take our time). Europe's
Because if we can't get those re-
sults, we have to ask ourselves whether a
triple A bank should spend its expensive
resources for such meager results, when
other parts of the organization can do
much better.
Then you need the deals to reach that target
revenue.
Absolutely. It's a question of closing deals.
The reason for having a good relationship
is to generate deals. A relationship with
out deals is not a relationship. A deal
closed, with fees paid, is really the only ev-
idence that we're bringing value to a
cliënt. This is also how the market meas-
ures our performance, how we build our
reputation, and by way of consequence,
our franchise. Our purpose in RI is to do
deals, where we bring value to a cliënt by
finding an off-balance sheet solution to fi-
nance inventories or receivables, or a tax-
based solution, or a M&A solution with
or without acquisition financing and so
on. It's also key that we earn at least sev-
eral thousand euros on each deal, and if
we use solvency, to get a big bang for our
solvency buck. And let's remember that
outside the Netherlands, our market share
in Europe is still very small. Deals are hap
pening in these markets. We can and
should get a bigger share.
How do you find the right dient?
It's not easy. The right cliënt is someone
who is convinced that we can do some-
thing unique for him, and who is therefore
willing to pay for it. It doesn't have to be a
big cliënt. Obviously, the more interna
tional, the better we can use our interna
tional network as a competitive advan-
tage. The difficult part is to get him to talk
to us about his strategie challenges. We've
been successful in some markets, notably
in the UK, less in others. GMs in Europe
spend a lot of time doing this, and the ac
cess they have to key clients is very valu-
able. Once we have ac
cess at the right level
(the CFO or up), then
the RMs and the prod
uct specialists can show
their skills in under-
standing the real issues
and finding the right So
lutions.
This directed approach
really seems to be taking
shape in Germany.
What's happening in
Henri Jacquand Germany is really excit-
ing. Once the merger
with DG was called off, we had to quickly
re-evaluate our presence there. We asked
ourselves what we really wanted to do.
And a small group of very dedicated peo-
ple put together a bold plan, very focused,
in terms of both number of activities and
clients. And it's been supported by the
managing board and the global product
managers. From now on, all energies will
be concentrated on M&A, leveraged fi-
nance, structured trade finance and rela
tionship management limited to clients
with high revenue potential. The plan's
success also depends a lot on teamwork,
as the top guys operate like partners.
They're accountable as a group to make it
work. In a parallel plan, we'11 gradually
move out of the other things we were do
ing, in a process that ensures clients and
staff are treated well. And finally, another
exciting development is the outsourcing of
most administration functions to our new
European Regional Service Centre in
Dublin (see related article) managed by
the same team that runs Rabobank Ireland
plc. 1 hope to see this concept extended to
other European offices in future.
Cost cutting is a big issue on Ris agenda.
Where is this happening in rest of Europe?
You get nowhere if you try to reduce costs
by peeling the onion. To get the job done,
sometimes you have to implement the
strictest measures. That's what we've
done. We've ended unprofitable relation-
ships, closed the treasury function where it
wasn't profitable (with David Vander's
help), or stopped investment banking ac
tivities which no one in London wanted to
sponsor. We've done it in France, we're
doing it in Germany. Kiev was closed be
cause we couldn't make real money there
while maintaining our high standards. Ac
tivities in Poland, Flungary and Turkey
have been streamlined, thanks to the dedi-
cation of the GMs, and Henk Adarns, who
has really helped the process.
You mentioned Hungary and Poland. There's
been talk about cooperating with RZB in the re
gion. What's happening?
RZB has very good coverage in central
and eastern Europe. We're investigating
what form of partnership with RZB, if
continued on page 9
Although back in the carly 1980s,
activities in North America had
originally been set up on a primarily
food and agri basis, the business had
gradually expanded to include other
sectors and opportunistic deals - this in
addition to health care and media and
telecom. Three years ago, our US col
leagues carried out a thorough analysis
of its cliënt base. They came to the con-
clusion that many of the customers, in-
cluding some relationships in the food
and agribusiness, were either not gener
ating adequate revenues, or were way
off our focus areas, or both. The cus-
tomer base was subsequently culled.
Health care customers were aniong
those to be transferred to other finan-
cial institutions. Our people in the US
are not almost totally F&A and TM1
focused, although you will see the odd
opportunistic deal come through from
the region. Many of our offices around
the world are similarly focused. Ar-
gentina and Chile are almost totally
F&A oriented. The same applies to
Australia and New Zealand. In Europe,
Spain has a very strong F&A focus,
while France does a lot of business in
TMI. We will be exploring the so-
called US model and other focused op-
erations in the spring.
