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Corporate Banking in North America
Sector approach
Regional model
Rabobank's Corporate Banking operations in North America are divided on a national and regional basis. Ten sector heads are
responsible for specific sectors on a national basis, which accounts for roughly 35-40% of Corporate Banking's 250 cliënt relationships.
The other 60-65% of cliënt relationships are handled by regional offices in Atlanta, Dallas, San Francisco, Chicago and Toronto.
An excellent example of the gains achieved through sector specialisation is that of cotton. Rabobank is now the largest and most well-
recognised banker to the North American and international cotton merchandising communities. 'Our North American portfolio, alone,
has commitments approaching US$ 1 billion,' says Barbara Hyland, Managing Director of the Commodities group in New York. 'Starting
from zero, in the early 1990s, we started financing select international merchandising firms, such as Dunavant, ECOM, Calcot, Reinhart,
Louis Dreyfus/Allenberg Cotton Company and Weil Bros., to whom we are now the lead bank and key advisor.'
Rabobank expanded into erop production by first offering financial products to cotton farmers in Australia, followed by expansion into
corporate farming in the United States, in 2002, and Brazil, in 2004. 'Commodity Price Risk Management tools are the most recent
products we have developed,' Hyland continues. These include commodity price swaps, offered by our London-based Structured
Commodity Finance team, and commodity loan derivatives in New York, London and Australia. Our FAR teams in Utrecht and New York
have provided invaluable assistance over the years and it is not uncommon to see the Rabo "cotton map" in the offices of clients and
trade organisations. To succeed at these levels, the cooperation between Rl relationship managers, credit analysts and product
specialists has been excellent.'
Gordon Arnold is Managing Director of Rabobank's Dallas office, which covers Texas
and its neighbouring states. 'In Dallas, we're responsible for developing and servicing
an almost exclusively F&A portfolio, in which we focus on the very largest Beef Pork
industry producers and processors/ says Arnold. 'Our largest cliënt has a capacity of
811,000 head of cattle at any one time and most have capacities in excess of 100,000.
Credit remains a key product that all of our clients need. But we also provide various
derivative products, such as interest rate swaps and other risk-management products.'
An ongoing trend in the Beef Pork sector and in food processing, in general, is
consolidation. 'Not only are livestock farmers merging with each other, but they are
also merging with food processing companies and this is happening across the food
industry,' says Arnold. 'Consequently, the products we offer include M&A advice and
financing acquisitions. In the case of very large transactions, we often act as the lead
bank in syndicated loan arrangements.'
'Corporate Banking's regional offices in North America serve a useful role,' Arnold
concludes. 'The United States is a huge market for Rabobank and the key to cliënt
intimacy is face-to-face contact. Many clients also appreciate our regional
knowledge and expertise, which gives us a competitive advantage.'
Gordon Arnold
The Word 17
