Banks offering transaction services for corporate and institutional clients faced increased operating pressures in 2015. From fee compression to low interest rates and elevated competition, banks have had to maneuver around these challenges and still report positive growth. It has not been easy.

 

The good news is that these banks were operating in a region that was continuing to show positive growth. Corporates and institutional clients, while facing economic headwinds as a result of the slower growth were still looking to grow beyond national borders or deepening penetration in the domestic markets.

 

The bad news was that the travails facing the banking industry as a whole – whether it was higher capital requirement, elevated regulatory scrutiny or deteriorating credit outlook – were being felt among all the transaction banks. To succeed against this backdrop required the buy-in of top management, tactical use of restricted resources to invest and stay competitive and while not losing sight of clients’ needs.

 

More than ever, clients expect their banks to remain at the top of their game. They especially value a partnership approach through these challenging times. The withdrawal of the Royal Bank of Scotland (RBS) from Asia during the year has certainly shaken confidence. Despite assurances that transaction banking is insulated from the turmoil banks face in other areas, the demise of RBS sent an unequivocal message that even a valued franchise was not safe when other, perhaps more important considerations, came into play.

 

It was in this environment that the overall best transaction banks for the year stood out. The Asset’s board of editors narrowed the list down to three institutions in 2015: DBS Bank, Deutsche Bank and Standard Chartered Bank.

 

DBS Bank has been on this amazing journey that began seven years ago. It transformed its cash and trade business to become a material contributor to the bank’s financial success. The bank is no longer only serving local customers. It has grown its footprint into China, India and Asean targeting a segment of the market where it has a competitive advantage.

 

Deutsche Bank is a proven transaction banking engine. Perhaps reflecting its German pedigree, its strength lies in its attention to detail, embrace of technology and a solid ability to implement to the delight of its clients. Against worthy global rivals, it has succeeded to take away business on the back of its commitment to continue to build its franchise in the region.

 

Standard Chartered soldiers on despite facing the greatest financial challenge not seen in its recent history. After the restructuring, the business of transaction banking has become even more critical. It has wrapped its strategy around China and the internationalization of the renminbi. Among the international banks, Standard Chartered is making the biggest bet that it will all come good when China opens up and the bank will be at the centre of the flows.

 

In the cash management category, it’s a five-way battle between Citi, Deutsche Bank, DBS Bank, HSBC and Standard Chartered Bank. Citi is a powerhouse especially with its list of blue chip international clients. HSBC has deep roots in markets such as Hong Kong, a leading financial centre in this region. Grappling with rate compression, these selected institutions have had to take a new approach in handling the operating balances of their clients. Cash management banks have to provide sophisticated tailor-made solutions for strategically important clients.

 

Trade finance, like in previous years, was a very competitive category especially in a market facing lower volumes. This year’s trade finance category features the likes of Bank of China, DBS Bank, Deutsche Bank, HSBC, Standard Chartered Bank and SMBC. Bank of China leads among the Chinese banks and now is able to offer more sophisticated solutions. SMBC has built a regional business serving Japanese and multinational clients. It ranked highly in the quality of its service according to The Asset Treasury Review 2016. Due to the challenging market conditions, many traditionally strong trade finance banks have had to provide innovative structures to their clients. Supply chain finance and structured trade were particularly notable in the best solutions of 2015.

 

Transaction banking technology over the years has grown to become an important consideration for clients when choosing a banking partner. Clients are now looking for a platform that is simple yet offers users a variety of transaction tools to run their day-to-day operations. Nominees in The Asset Triple A E-Solutions and Technology Partner Bank category include BNP Paribas, Citi and Deutsche Bank. BNP Paribas is a latecomer in Asia but with that it enjoys a distinct advantage. Unlike incumbent global banks that still run on legacy systems and struggle to integrate them into newer offerings, BNP Paribas is able to leapfrog them to come up with leading edge solutions that often are much more intuitive and easier to customize.

 

Developments in the renminbi space have taken tremendous leaps last year following the currency’s introduction into the International Monetary Fund’s SDR (Special Drawing Rights) basket of currencies. The People’s Bank of China relaxation of cash pooling schemes until early this year has also opened up the possibilities to link the Chinese currency to regional and global treasury pools. Shortlisted banks for the renminbi bank category include Bank of China, DBS, Deutsche Bank and Standard Chartered Bank.  

 

The Asset board of editors is pleased to present this year’s nominee list and Editors’ Triple Star selections. Please click here to see the full list.

 

The Asset Triple A Awards for Treasury, Trade and Risk Management are an annual survey of service providers in transaction banking in Asia and the Middle East. The awards are based on bank submissions and a respondent benchmark survey of CFOs, treasurers and treasury professionals. This year, a record number of over 1,000 clients participated.

 

The best transaction bank winners will be revealed at an Oscar-style gala awards dinner on May 11 2016 at the Four Seasons Hotel in Hong Kong. The presentation will be preceded by The Asset's Treasury and Trade Summit, which will be held on the same day. Please click here if you are interested to attend.