Bright side of the road
regional focus
Going Dutch
Effective strategy
In a region that has faced changes, both economie and within Rl itself,
our Hong Kong team tells us how they're getting right back on track.
Richard Lee in Taipei gives a picture of his market, which is both mature
and in need of reform. And finally we turn to China, where great oppor-
tunities are taking shape. All in all, it's dear that Rl is surging full-
steam ahead.
Strict measures
More with less
What'sNewS Issue 2 March 2001
Picking up the pieces after crisis has
long heen Asia's major task. Further
complicating matters was the uneertainty
invoked by the DG merger. But now, with
the waters settling, our colleagues are
moving on. Focus markets, target clients
and streamlining activities are today's top
priorities. And teamwork, integration and
reorganization
are the buzz-
words. Says head
of the Greater
China hub and
I long Kong
branch, Ruurd
Weulen Kranen-
berg, 'We've had
a lot of cleaning
up and rethink-
ing to do, which
helped us identify
and get rid of ex-
cess weight. That hasn't always been easy
- we've had to end relationships with cer-
tain clients, target new clients, and ntake
sta ff changes when needed. But in the end,
it's all part of a larger philosophy. That is
about creating efficiency and synergy
within and between eacli office, and it's
about bringing the region closer together.'
The Ffong Kong branch in particular ex-
perienced quite an intense turnaround in
the last two years. At the time of the crisis,
much of Hong Kong's portfolio included
Ruurd Weulen Kronenberg
small, local companies. The 'flu'
hit local corporates hard, and
Hong Kong's balance sheet took a
beating. Business has certainly
bounced back, but a few loose
screws - such as bad loans - are set
to be restructured and sold down
this year. 'The crisis served as a
kind of wake-up call,' Weulen
Kranenberg explains. 'It's driven
us to seriously upgrade our busi
ness. That meant targeting large
international players where we
could offer unique products and
generate decent returns. It also meant
driving the business to become a strong
niche player, which is key to our surviva
Today, it's clear Hong Kong is on a new
In the last few years, trade
and Dutch corporate in-
vestnient in Asia have
shown an annual average
increasc of 15 to 16%. To
ensure our Asian teams are
in on the action, Hong
Kong's Berry Marttin, head
of international corporates,
has initiated a project iden-
tifying the top 100 Dutch
customers with interests in
Asia. 'We're missing out on a big op-
portunity,' Marttin explains. 'Our
Rabo colleagues have built up strong
and long standing relationships with
corporates in the Netherlands - and
these relationships should be extended
Berry Marttin
around the world. Those
customers who already,
and who plan to, do busi
ness in this region should
be targetcd and ap-
proached by our Asian of
fices who can offer lcnd-
ing, treasury, structured
finance, M&A and local
currency financing serv
ices. By improving inter-
nal communication -
which can be as simpte as
picking up the phone or
sending an e-mail - Rabo staff can liaise
their clients with Rl Asia colleagues.
Hong Kong and Singapore are also
strengthening their Dutch Desk capa-
bilities to function as ambassadors of
RNAB in Rl offices.
path. George Yau, finan-
cial controller,
offers some insight. 'The
branch of today com-
pared to two years ago is
very different. Since early
1999 when reorganization
began, FTE has been de-
creased by more than
40%, and front 1999 to
2000, costs decreased by
33%. And we're achiev-
George Yau ing considerable returns -
last year profit topped
EUR 7 million.' The reason, Yau explains,
is the drive to become 'leaner, meaner and
more focused'. Hong Kong underwent a
critical self-evaluation, involving major
changes in the way business was carried
out. Simply put: return to profitability by
reducing complexity, tightly control costs
and FTE, focus on what we can do (se-
lected clients and products) and offer top
services. In practice, this translated into
exiting relationships that were 'non-core'
and 'unaffordable' - clients who received
services without yielding sufficiënt eco
nomie benefits. Infrastructurally, this al-
lowed Hong Kong's team to be right-sized
from 185 to 115 without increasing oper-
ational risks.
'Each of our top five customers today gen-
erates more than USD 1 million per year
in revenue,' Yau continues. 'Now we're
more focused - we're generating more re
turns to our stakeholders with fewer
transactions, less people and processing
costs, but with more professionalism and
teamwork.' Just take a look at PCCW, one
of RI's global top ten TMI revenue earners
in 2000, to get an idea of how well Hong
Kong's business is shaping up. Such finan-
cial success has also given a much
