SEPA

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Relationships, Risk and Regional Banking Over the past 150 years, SEB has developed a strategy, culture and product set to serve the needs of both large and mid-sized corporations, and institutional clients. SEB support these organisations in SEB's home markets, which extend across the Nordics, Baltics and Germany, and also facilitate their international expansion throughout Europe and globally. To enable this, SEB have adopted a highly collaborative approach, both with client organisations and partner banks, allowing SEB to provide outbound services to it's clients across 80 markets worldwide.

In the latest issue of TMI, our editor, Helen Sanders, interviews SEB's Head of Global Transaction Services, Mikael Björknert, about a range of subjects, including cash management (specifically the attitude of SEB customers to SEPA and the future of SEPA in Europe), corporate-to-bank relationships, and what the future holds for the banking industry.

Relationships, Risk and Regional Banking

What would you identify as SEB’s core market?

Over the past 150 years, SEB has developed a strategy, culture and product set to serve the needs of both large and mid-sized corporations, and institutional clients. We support these organisations in our home markets, which extend across the Nordics, Baltics and Germany, and also facilitate their international expansion throughout Europe and globally. To enable this, we have adopted a highly collaborative approach, both with client organisations and with partner banks, allowing us to provide outbound services to our clients across 80 markets worldwide.

This co-operative approach has also made SEB highly successful in supporting inbound financial institution and corporate clients’ business. This includes multinational corporations seeking to do business in the Nordic and Baltic regions, who need a strong banking partner which can actively support their business strategy and demonstrate a detailed knowledge of each market. For these customers, we often find that they work with SEB to provide one product initially, such as subcustody, and then expand into other areas as they become more familiar with the bank, our services and approach.

How does SEB differentiate its services in cash management?

SEB has played an intrinsic and vital role within the Nordic industrial context for well over a century, supporting today’s multinational companies from a very early stage in their lifecycle through to the present day. The Nordic region has been a marvellous birthplace for SEB. Unlike other regions where banks built their success through client volume, SEB needed to be smarter and more entrepreneurial, and work more closely with our clients across the value chain rather than simply focusing on delivering individual products. This approach has created a strong, unique culture within the bank which differs fundamentally from other organisations.

We are already providing SEPA services to a number of our Nordic customers who have a pan-European reach and use the euro extensively.

One example of this is the Corporate Financial Value Chain concept. This involves SEB working closely with our customers to build up a detailed picture of their needs in a systematic way. We can then structure, implement and support solutions that match their requirements and priorities, across cash, trade and other working capital products. By adopting the Corporate Financial Value Chain approach, companies can benchmark their financial processes against many of the world’s leading corporations, and set objectives to accelerate up the excellence ladder.

To deliver the Corporate Financial Value Chain approach successfully requires a detailed appreciation of the principles and drivers of each client organisation, for which education is key: education both internally and within customer organisations. Ensuring that SEB staff have a clear understanding of how corporations operate, their needs and priorities, is critical to identifying and implementing potential solutions.

Remaining on the topic of cash management, with the recent launch of SEPA Direct Debits, how would you describe your customers’ attitude towards SEPA (Single Euro Payments Area)?

We are already providing SEPA services to a number of our Nordic customers who have a pan-European reach and use the euro extensively. Companies have a different perception of the value of SEPA depending on where they are based. For example, in Finland, more efficient use of the euro is very important; in Norway, there is little awareness and still less interest in SEPA. However, SEPA is a reality and it is important not to think of it simply as an inevitable industry change, but to recognise the benefits. SEPA is symbolic of the rapidly increasing commoditisation of global money movements, assisted by electronic payments handling and associated transactional information. For corporates operating in Europe, the opportunities for standardisation of information flows as well as rationalisation of accounts and banking partners are considerable.

How are you helping clients to achieve these benefits?

As well as supporting SEPA payments, we help clients to understand their immediate payments requirements and future strategy, interoperability and information needs, and build up a solution accordingly. Just as a car is constructed from a variety of different specialist components, an effective and integrated payments and cash management solution requires elements provided by both banks and vendors to ensure that processes are well-designed, with the necessary automation, security and intuitive user interface, together with the right information flows.

One of the challenges of achieving a fully integrated solution is the need to engage with different parts of the business, such as accounts payable, accounts receivable and treasury, which may have varying objectives. Furthermore, these departments frequently use a language that is specific to their activities, which may not always translate easily across departments. Consequently, at SEB we consider part of our role to be a facilitator within an organisation, and to translate both objectives and language into a common vision.

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