Standard Bank Helps Clients Across the African Continent

by Rob Porter, Head of FIC Sales, Global Markets Division, Standard Bank and Themba Rikhotso, Head of Cash Management Sales, Transactional Products and Services (TPS), Standard Bank

Standard Bank’s ability to provide pricing in 40 African currencies gives it a unique capability to service multi-jurisdictional corporations looking for a solid corporate treasury solution on the continent.

“Standard Bank has enjoyed a long history of supporting South African and multinational corporate clients as they expand their businesses into the rest of Africa,” says Rob Porter, Head, FIC Sales in Standard Bank’s Global Markets Division. “Our extensive physical footprint in 18 markets across sub-Saharan Africa means we can offer clients on-the-ground expertise in the high-growth markets on the continent as well as world class, centralised support for their corporate treasury services. That allows us to support our clients’ growth journey across the African continent.”

Standard Bank is the world’s number one liquidity provider of African currencies.

Standard Bank is the world’s number one liquidity provider of African currencies; this is underpinned by the group’s geographic reach across the continent and backed by the liquidity provided by its South African home base.  Standard Bank’s corporate and investment banking offering enables Standard Bank to provide customer-focused flow solutions that allow its clients to focus on their core businesses rather than administrative burdens.

“Standard Bank’s investment in technology over the last few years allows us to provide clients with a single interface that can still draw on the expertise of both our internal business units as well as the localised knowledge of our operations in the various African markets in which we operate,” said Porter. “That is of immense use to clients regardless of whether their own internal treasury model is centralised or decentralised.”

Business Online, Standard Bank’s electronic banking platform on the African continent, provides its clients with a single, real-time view of their cash positions across products, currencies and countries. The web-based platform can be accessed across the globe at any time and also allows clients to transact and view their balances and statements from other banks thanks to Standard Bank’s SWIFT capabilities.

“The main trends we’re seeing in corporate treasury management is that clients want improved visibility of cash across operations; better control of payments & collections; centralised forex management; and the ability to integrate our banking platforms into the clients’ own enterprise resource planning (ERP) systems,” said Themba Rikhotso, Head, Cash Management Sales, Transactional  Products and Services at Standard Bank, “That allows for improved account management and reconciliation as well as straight-through processing of transactions. The ability to fully integrate our own system into the client’s ERP platform is particularly beneficial as it reduces the need for them to rely solely on our banking platforms to perform banking functions.”

eMarketTrader, Standard Bank’s electronic single dealer platform, allows clients to stream liquid prices in African currencies, thereby enabling them to optimise their foreign exchange risk management. The platform recently won the Super Regional award in the 2015 Profit and Loss Services Digital FX Awards – a powerful accolade for an African bank.

“Given that liquidity remains the greatest single challenge in Africa’s currency markets, it is important that corporate treasurers focus on relationships with banks that can assist in this regard,” said Porter. “Too often software vendors are eager to sell advanced technology which brings no guaranteed liquidity stream or potentially fragments liquidity in a domestic currency market.”

Another emerging trend in corporate treasury management is responsibility for the oversight of working capital.

Another emerging trend in corporate treasury management is responsibility for the oversight of working capital. Corporate treasurers are playing an increasingly important role in optimising working capital because of their unique vantage point in the organisation. Standard Bank has responded to this trend by creating a Working Capital Advisory function within its transactional banking division. This function is in its fourth year of operation and is designed to assist corporate treasurers in optimising their working capital by providing financial modelling, financial process mapping, best practices in working capital management and benchmarking working capital ratios across industry sectors. A 2014 survey by Standard Bank’s team found that 235 listed entities, on the JSE, had a cumulative R330bn tied up in unnecessary working capital.

“Large corporate organisations often sit with excess working capital due to their size and the complexity of managing working capital across multiple jurisdictions,” said Rikhotso. “Institutions like Standard Bank are well-positioned to assist, both from a solution and advisory perspective. Several of our clients have benefited greatly from our various trade solutions, which have improved their cash conversion cycles. Our advisory service has also positively influenced their treasury policies, working capital and operational metrics and financial supply chain processes.”[[[PAGE]]]

Standard Bank also provides extensive economic and financial markets research with a specific focus on Africa. The group has more than 40 economists, analysts and strategists located in Johannesburg, London, New York, Kenya, Nigeria and other select countries which provide corporate treasurers with expert insights into trends affecting the real economy, exchange rates, credit markets, commodities and interest rates.