'reliabie, quality
and service
orientated'
QAF, Executive Director,
Tam Teh Chuen:
Looking abroad for growth
Tailored products
Secret to success
Acquisition identification
Proactive strength
winner
'Rabobank has a very good understand-
ing of our business and a good product
offering. Continued proactivity is essen-
tial, as is quick turnaround. To better its
good performance, Rabobank must stay
close to the ground to understand the
competitive and operational conditions
QAF's businesses face. Product dumping
is a big no-no.'
QAF is typical of many successful compa-
nies home grown in the small Singapore
market: it had to look to markets in other
countries to feed its growth. Rabobank is
proving to be the ideal growth partner in
supplying innovative solutions, including
commodity stock acquisitions, cross coun
try interest rate and currency exchange
hedging. Futher, Rabobank is committed
to evolving QAF's business by identifying
F&A acquisition opportunities.
The returns from QAF's more established
bread line have provided a stable base for
growth,' explains Dimmick. 'Pork produc
tion was added three years ago. And
although the recent drought in Australia
drove feed (grain) prices up, the company
gained market share as weaker players
disappeared. Today the balance sheet is
strong and the company is looking to
leveragethat.'
Rabobank has played a big part in keeping
the balance sheet healthy with tailored FX
products. The Australian currency has
been volatile over the last year or more,
so QAF hedged both their cash flows and
their capital positions with us,' says
Dimmick. This has profited both parties,
leading to a SGD 6 million gain for the
cliënt last year.'
The other high-value specific product
provided by Rabobank is stock financing.
Skyrocketing grain prices in late 2002
stretched QAF's balance sheet because the
company had to keep buying grain to feed
the pigs. With this stock financing facility,
QAF tells Rabobank's special purpose team
(in Australia) who to buy grain from and
how much to buy. Rabobank then owns
the grain, stores it in warehouses, and QAF
buys it when required. There are very few
other banks that have this facility and it
shows how Rabobank's understanding of
F&A issues results in wins for the cliënt. As
the price of grain has returned to normal
prices, QAF continue to use this facility
because it works so well for them.
According to Dimmick, The secrets to
successful cliënt relationships are regular
contact, anticipating their needs, and
seamless teamwork.' The cliënt has direct
contact with RabobankTreasury people -
calling them for spot trades and deposits.
Rabobank's Product Managers and QAF's
technical people, in Singapore and
Australia, are also in regular contact, pro-
viding a good case study of co-operation
between RI's Singapore and Australian
branches. Further collaboration with Asian
branches is envisaged as acquisition
opportunities become clear.
The next step for QAF is critical,' Dimmick
explains. 'What markets should they tap
next?' Rabobank's task is to identify further
F&A acquisitions for the company. 'In SE
Asian markets growth is limited but there
is some potential (for the bread line) in
Thailand and Indonesia,' he says. 'Outside
SE Asia, there are substantial new pork
markets that the company could tap, such
as China, and an even larger market share
in Australia. The threat is that it's presti-
gious for clients to be associated with big
investment banks, like Goldman Sachs, JP
Morgan Chase and Merrill Lynch, who are
all pounding on their doors. This is why
it's important to identify the opportunities
and problems even before the cliënt
sees them.'
Rabobank distinguishes itself by its deliv-
ery capabilities, time to market, speed of
response, and F&A expertise. 'And we're
always thinking proactively,' adds
Dimmick. 'A new product we believe QAF
will find useful is weather derivatives -
hedging rainfall indexes could realize big
gains. We also see opportunities for sup-
porting QAF's food distribution activities.'
The Word 13
