Here is why CFOs/treasurers select (or deselect) a banking partner
Confessions from CFOs and treasurers on what they like and dislike about service providers reveal also what it takes to win The Asset Triple A awards. Here are the nominees
Twenty years since The Asset began to monitor the quality of service delivered by providers in treasury, trade, supply chain and risk management, some things never change despite the best intentions of those involved.
For instance, when questioned about what annoys him about his banking partner, one CFO cites unanswered phone calls as one bone of contention. Others are irked when providers overpromise and then underdeliver. “Banks in many cases are just mass producers of certain widgets,” says a treasurer of a regional large corporate.
In a constantly-evolving and competitive landscape where regional RFPs/RFIs are becoming less frequent, CFOs and treasurers are looking for service partners that can co-create and craft solutions that fit their specific pain points. This is especially relevant as technology plays an ever-increasing role in the treasury function.
“It’s about giving us a better understanding on how this emerging technology can address some of the issues that our company has,” shares a regional treasurer of a life insurance group. “What I would like to see from banks in the future is: here’s the product and here is how it addresses your specific challenges. Every company has its own unique challenges.”
According to last year’s Asset Benchmark Research Treasury Review, which surveyed more than 1,200 Asian-based CFOs and treasurers, the number one factor in choosing a service provider (for cash management in particular) was service quality followed by pricing.
Those service-orientated qualities seemed somewhat lacking within some banks, according to The Asset’s 2019 review of service satisfaction levels, with insights gleaned from speaking with CFOs and treasurers as part of this year’s awards process. In addition to being unresponsive to client’s specialized needs, other grievances directed at providers include the frequent change of relationship managers (RMs) and the consequent need to re-educate new RMs on aspects of their business.
Other pointed comments revolve around implementation, where several banks were unable to effectively move clients through the implementation stage to servicing. Here, service levels drop off, and CFOs and treasurers cite this as a contentious point.
Lack of coordination between banks was a major hurdle for a China-based treasurer for a multinational company, who says that their previous service provider was unable to work with local banks in China outside tier-1 cities. The quality of the partnership between a large international bank with their local bank partners matters a lot, he adds.
As large international service providers, faced with cost pressures and the inability to generate adequate returns, are often forced to rationalize (shrink) their client base, sometimes this results in unpleasant outcomes. This situation is especially noticeable among the large US institutions operating under conditions where they have to obtain elevated returns.
Not all feedback was negative. Fulsome praise was heaped on those service providers who go the extra mile. “It’s the presence and the solutions that this bank provides to us and the flexibility they can give in terms of banking facilities and credit lines that make us want to work with them,” gushes one Asia-based CFO of a healthcare company.
“It’s also about the speed in coming back to answer our questions. It’s the quality of service, making sure that the transactions go through and are seamless,” the CFO adds.
Other points of praise centre around a banking partner offering a customized solution, rather than running through a list of banking products. “For me, number one is the solution; whether the bank meet the requirements that we ask. Second is service, because at the end of the day it is still a people business. Third, the bank has to be able to participate in the credit facility because our model is based on wallet sharing,” explains the Singapore-based treasurer of a logistics company.
Useful client feedback mechanisms continue to play a significant factor in the evaluation process to determine the best specialists and institutions in the region for The Asset Triple A Best in Treasury, Trade, Supply Chain and Risk Awards. For the complete list of bank nominees, please click here.
Vote here and share your views on which institution should win The Asset Triple A Awards.
The winners of the Best Service Providers will be revealed during The Asset Triple A Treasury, Trade, Supply Chain and Risk Awards dinner at the Four Seasons Hotel in Hong Kong.
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5 Apr 2019