4 Clients already appreciate our extensive F&A knowledge and with this new model we will be able to better service them in their specific F&A needs 9 )1 i PORK BEEF IN CHINA Export Gilles Boumeester: competitors and provide clients with incisive advice, Leffelaar believes. Using one of Rabobank's strong assets, FAR, which produces in-depth intelligence reports on issues and trends across the key F&A sectors, Leffelaar explains that there are two main areas in which Rabobank can play a significant role. 'The first is in providing clients with a better understanding of the market, which means we can offer a one-stop-service. The second is helping clients understand, and take advantage of, the emerging trend of coordinated supply chain that we are now witnessing in China. Rabobank has a great deal of experience in this area, and we can provide cooperative structures and supply chain financing to local markets." According to Chenjun Pan, industry takeovers increased sharply after an infectious disease outbreak in 2007 decimated the pig population, causing many small-scale farmers to quit, and she expects this trend to continue. "Many smaller farmers are not able to compete with larger sized farms in terms of economies of scale and food safety. Additionally, there are around 20,000 designated slaughterhouses in China, but a recent policy change means that the number of slaughter and processing facilities will decrease, resulting in consolidation activity. We expect to see companies from outside China showing an interest in China's processing market." This expected influx of western companies is particularly good news for Rabobank, Leffelaar says, as local Chinese banks are not especially familiar with the needs of western companies. Jeroen Leffelaar: "I think Rabobank isn't competing for the Standard or conventional banking products, rather, we need to focus on the areas where we can bring value to clients, which is in international networks, flexible fïnancial services and knowledge." One of Rabobank's key strengths is the depth of its intelligence reporting through FAR. A report on the pork market in China was produced by Chenjun Pan earlier this year, and was received very positively by clients. 'The report took an in-depth look at pig farming in China, covering everything from current market trends, M&A activity, sector challenges and future opportunities. We're confident that it will develop new business lines for us. I've spoken with clients in the United States whose interest was sparked by the report, and we've received a lot of positive feedback from relationship managers across the Rabobank, who say that their clients have a better understanding of the business openings in China because of the intelligence we're producing." The next step in the process will be building stronger bonds with Chinese companies, Leffelaar says. "We have access to Chinese pork companies, but so far we don't have in-depth relationships with enough of them," he explains. 'There are a number of reasons for this: firstly, we are slightly more expensive when it comes to financing than local banks. Secondly, the Chinese market is not ready for highly structured solutions, and because many Chinese companies look for a listing on the stock market, financing from banks is not such a priority. Rabobank's current product offering in China is limited; we currently can't offer 'flow products', such as cash management, which allow us to get a good insight into the client's activities. In general, our tangible relationship with a cliënt starts with a bilateral financing or participation in a syndicated financing. All pretty straight forward financing rather than structured deals. Despite the fact that these companies look for a listing on the stock market rather than financing from a bank, our strategy is to continue to see them. When they choose to export they'll require international market access, and not only can we help them on that front, we'll also be able to provide them with additional access to F&A knowledge, which just happens to be ourspeciality."« i issue 24 -Y RI WORLD

Rabobank Bronnenarchief

blad 'RI World' (EN) | 2010 | | pagina 24