A New Era of Transaction Banking
Insights from Leading Bankers in Germany
Ahead of Schwab Ley & Greiner’s annual Finanzsymposium, four leading bankers in Germany discussed some of the trends and challenges in transaction banking, moderated by Thomas Schräder, Corporate Treasury Solutions, PwC.
Jan Kupfer, Global Co-head, Global Transaction Banking, UniCredit Group
Frank-Oliver Wolf, Global Head of Transaction Banking Sales, Germany, Commerzbank
Michael Spiegel, Head of Global Transaction Banking, Deutsche Bank
Andreas Bock, Head of Global Liquidity and Cash Management, Germany, HSBC
Moderator: Thomas Schräder, Corporate Treasury Solutions, PwC
Thomas Schräder, PwC
How do you think your clients’ transaction banking needs have changed over recent years?
Andreas Bock, HSBC
One thing that is clear today is that client relationships, and understanding client requirements at a detailed level, have become more important than ever. Although it may be a transactional business, it is based on relationships, and clients are looking for specific cash and liquidity management solutions, advice and support across the activities and regions in which they do business. This does not only apply to markets that are typically considered more complex, such as China and India, but here in Europe we also have major changes taking place, both politically and economically, such as Brexit, and regulations such as PSD2. Similarly, we are seeing a great deal of change in the United States, and clients are looking for help in navigating these changes.
Many of our clients here in Germany already have sophisticated treasury operations, whether large, multi-site operations or smaller, leaner treasury functions, but maximising operational efficiency remains important, whilst achieving regulatory compliance and responding to economic, technology and market changes.
Frank-Oliver Wolf, Commerzbank
Regulations, such as anti-money laundering and sanctions screening, will increasingly impact the way that clients consider bank account management, cash management and payments. Furthermore, as these regulations impact both cash and trade, these are likely to move closer together.
Jan Kupfer, UniCredit
International business has become more important for a far wider range of clients than in the past, with a wide range of German Mittelstand (mid-market) companies now expanding overseas, a trend that we expect will continue.
Risk management has also become more important, not only market and credit risk but also operational risk, particularly fraud. There’s now far more attention from banks and corporates alike on fraud awareness and prevention, and treasurers are looking at how best to protect their business.
Improving operational efficiency and visibility is also a key trend we see with our clients, including a renewed focus on reporting, tracking and cash flow analysis, monitoring debtors and creditors, and understanding their risk and liquidity position more clearly.
Michael Spiegel, Deutsche Bank
Although a wider spectrum of companies are expanding overseas, each company will inevitably have different needs and priorities depending on its treasury maturity as well as its size, business model, etc. So we see quite a difference between the large mid-cap and large corporations that have an established treasury function compared with smaller mid-cap firms.
The other comment I would make is to differentiate between clients that operate on a B2B or B2C basis, as regulation impacts on these companies in different ways.
I would strongly agree with Jan’s comments on cybersecurity and fraud: this has become a priority for companies of all sizes and in all industries.