Strategic Treasury

A Symbiotic Relationship TMI's CEO provides an overview of the Because Timing is Everything supplement, looking at what corporates can achieve with a good relationship from their bank.

A Symbiotic Relationship

by Robin Page, Chief Executive, TMI

Collaboration, co-operation, partnership – these are the threads running through this series of articles from J. P. Morgan Treasury Services that we have been delighted to publish in TMI. Although each stands alone, gathered together here they provide a useful summary of just what corporates can achieve from a good relationship with their bank(s) –something that we might describe as a symbiotic relationship which, as in nature, is beneficial to both parties.

The global financial crisis pointed up the usefulness of trade finance “to increase predictability of cash flow, release working capital from the supply chain and, perhaps most importantly, to manage supply chain risk” as Jeremy Shaw emphasises in his article. J. P. Morgan is strongly committed to supporting clients in managing risk wherever they do business, and its Global Trade solutions are tailored to the regions where those clients are : “we want to be wherever they need us,” says Shaw, who notes that trade is often the reason a client approaches the bank in the first place.

Linda McLaughlin-Moore and Mike Burn focus on efficiency and technology as key to enhanced treasury management, noting that even during a prolonged period of recession organisations want to “grow more quickly and more sustainably” than their competitors. J.P. Morgan shares this ambition, and the two authors explain how the bank aims to achieve it by “anticipating, delivering and supporting” the solutions their customers require. They identify standardisation and technology as of particular importance, citing innovations such as J.P. Morgan’s ACCESS Mobile – a smartphone and tablet tool that provides swift and convenient access to a wide range of information, actions and analytics. They also outline the bank’s operations in an expanding number of regions including the US, EMEA, Asia Pacific, Latin America, Russia, Saudi Arabia and Central and & Eastern Europe. But, they say, the bank does not measure its success by the variety of solutions it offers or the countries in which they are offered - rather recognising “that pivotal to a successful relationship with our customers is the quality of customer experience” both directly with J.P. Morgan and across the bank’s entire network.

The 14 countries that comprise the Middle East and North Africa are central to J.P. Morgan’s growth strategy, and Asif Raza, Farrukh Siddiqui and Tristan Attenborough discuss the growing importance of the region to their customers and describe how the bank supports their plans in the region. It first established itself in Saudi Arabia as long ago as 1933 and now has well over 200 professionals in MENA. There are disparate banking regulations and varying degrees of market sophistication in the various countries, and the bank with its detailed market knowledge and experience of working with customers with comparable needs, plus the availability of local expertise, helps companies to navigate successfully through the often bewildering intricacies of local regulatory compliance and market practices.

Andrew Betts has drawn up what he dubs “a fitness programme for treasurers”, inspired by the rigorous training of the Olympic and Paralympic athletes who enthralled the world last summer. The role of a treasurer in supporting the company to achieve a similar standard of gold medal excellence is a constant one, and their on-going training must consist of a regular re-visiting of liquidity and working capital structures and processes to ensure that they remain world-class. The author provides a five-step fitness programme to “position the company for success and future growth,” helped by working with the right banking partner.

James Waud says that his personal suggestion for the coming year “is that Treasury and Procurement should identify at least one opportunity” on which to work together. As Waud notes this is by no means a new message and it is one that J.P. Morgan has been urging for some time, but he sees the New Year as providing fresh focus and impetus: his article considers some of the opportunities for such collaborative working and outlines the benefits that some customers have gained by it, bridging a gap between the two functions with the assistance of the bank, who have wide experience of working with both.

The right relationship approach is the subject of the article by Bertrand Cousin and Vincent Lietard, who discuss how “relationships are being forged and how clients are benefiting” in France and Germany. J.P. Morgan concentrated on investment banking in these countries in the early years of doing business there, but more recently has extended its activities to corporate banking and associated business functions such as treasury services, FX, cards, liquidity, asset management and so on, and is currently enjoying a significant expansion of its customer base among French and Belgian multinationals. And although this is a relatively new business function for the bank it has “gained traction remarkably quickly amongst corporations that are seeking a strong international banking partner that can support their global growth objectives”.

In nice counterpoint to these objective examinations of various strands of the bank/customer relationship are six ‘think pieces’ by John Gibbons, who gives his lively personal take on some of the items currently high on treasurers’ agendas, including SEPA, multibank portals, treasury technology and the problems of the Eurozone.

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