Industry, Energy and Passion in Global Transaction Services

In this edition, we are delighted to feature Neal Livingston, who recently moved back to Europe to join RBS after an extended period in Asia, during which time he successfully championed corporate connectivity and network management solutions at Standard Chartered bank. In this interview, we talk to Neal about his perceptions and aspirations in his new role as Head of EMEA Global Transaction Services (GTS), at RBS.

What attracted you to joining RBS GTS?

There are few banks that are fully committed to Global Transaction Services, and even fewer that have the infrastructure and client service provision to deliver the depth and breadth of capability that is required. I knew that moving from Standard Chartered would not be easy, as I wanted to find another bank that had comparable commitment and capability in GTS, but where there was also the potential to shape and enhance the business. The opportunity at RBS fulfilled these criteria, and I was attracted to the bank’s respected heritage, derived from both its RBS and ABN AMRO roots, the strength of leadership, and the impetus and capability within the GTS business. At the same time, I recognised that there was an opportunity to take the business to the next stage in its development, and enhance the GTS experience for clients even further.

Now that you have joined RBS, how have your perceptions about the bank changed or evolved, and to what extent are these aligned with the way that corporates view the bank?

Not only have there have been no unpleasant surprises since I joined, but in fact, the opposite is true. The GTS business is performing well, and is considered a core contributor to the bank as a whole, so it receives considerable strategic focus. This is very important to enable us to turn our vision into a reality by investing in the solutions that will enrich our clients’ business and enable them to achieve their strategic objectives.

From a product perspective, many of our solutions at RBS are best in class, particularly in global liquidity management. We have a strong suite of trade solutions that enable our clients to manage their risk and ease the process of trading internationally, which is becoming increasingly important as companies of all sizes seek to expand their geographic footprint into new markets.[[[PAGE]]]

I have always been aware that a fundamental part of the RBS value proposition is the strength of customer relationships, but I didn’t appreciate the degree to which this is the case. RBS, like many banks, has been through difficult times recently, but what has been very apparent is that our clients want us to succeed, and have remained loyal throughout. Similarly, RBS has an absolute commitment to helping our clients through their own difficult periods, and putting in place the strategies that will enable them to weather economic storms and achieve their potential in new markets. This mutual commitment, trust and loyalty are rare assets and differentiate the bank significantly.

What would you say are GTS’ key strengths today, and what do you wish them to be in the future?

The depth of client relationships, and the quality of our product suite are strengths that I hope we can continue to nurture and develop further in the future. However, products and relationships are not an end in themselves, but the elements with which to build a cohesive business strategy. Like any organisation, a bank needs a clear and compelling business strategy, and RBS has been clear about its future ambitions. From a GTS perspective, we will contribute to this by leveraging our strengths to do more for our clients, helping them to navigate through an environment that continues to be complex and uncertain. This should be an important measure of success for a global bank, and is one that we are fully committed to.

What key challenges are your corporate customers facing at present as they relate to GTS, and how are you helping clients to overcome them?

On-going liquidity constraints, the Eurozone crisis and the prospect of regulatory change are all posing considerable challenges for our clients. For example, in the latter case, although the initial impact of capital and liquidity requirements created by Basel III, Dodd-Frank and to some extent SEPA is on the banks, there are also considerable implications for corporates. Our clients want to understand what these regulations will mean, how they should prepare and what support we can offer. Consequently, we are adopting a highly transparent, consultative approach with our clients, providing information and facilitating preparations.

As the Eurozone crisis evolves, and liquidity constraints continue, market situations are changing very rapidly and unexpectedly. Treasurers need to be very responsive and ensure that their treasury policies continue to be appropriate to changing times. To enable this, we are responding to market events promptly and proactively, both in the way that we deliver client solutions and in the way that we manage our activities internally in order that we continue to support our clients’ liquidity and risk management objectives.[[[PAGE]]]

With a difficult economic climate at present, and considerable uncertainty about the future, what advice would you give to corporate treasurers?

The first thing I would note is the importance of getting to know your banking partners, and to invite them to get to know you too. As in every other industry, while banks may have similar products and geographic footprints, their approach and culture may differ significantly. Corporate treasurers often expect that their banks should take the time to understand their business strategy, processes, organisation and liquidity patterns, but this needs to be a two-way discussion. By appreciating fully each other’s objectives, strengths and constraints, a relationship of trust and confidence develops that in turn provides a context for designing and delivering solutions that meet both parties’ needs.

A second issue that I would raise is that of funding. With access to term financing severely restricted, there is considerable competitive advantage for those who are in a position to obtain such financing through the capital markets. Highly rated companies should therefore seek to leverage this opportunity, potentially as a way of financing new growth potential that will in turn create further commercial advantage. For companies that are not in a position to source term financing, other techniques exist that can also create competitive advantage by leveraging assets across the financial supply chain. Again, by establishing the right relationship with a banking partner, these solutions can be highly specific to the business and meet the company’s financing needs very precisely. By obtaining financing to fuel growth in new markets and amongst new customer groups, new returns can be generated that may be subject to different patterns than existing flows, and hedge business and financial risks.

Thirdly, during difficult times, treasurers cannot lose sight of the need to drive out excess costs and deal with perennial issues such as data management, control over information and processes and compliance.

I would conclude by saying that it is during volatile and uncertain periods that the best companies rise to the top. Treasurers cannot afford to make mistakes in their choice of banking partners. The right bank, that delivers the right solutions, relationship focus and geographic reach, combined with industry, energy and passion, can make the difference between those who drive forward and leverage new opportunities and those who are left behind.