Being an AAA rated institution and the WorldÃ¢â‚¬â„¢s leading F&A bank Rabobank is fortunate to have the advantage of extremely good liquidity across a number of products; add to this a broad retail base and the volume of business is significant. Because of our Global reach and depth of liquidity we are able to offer our home market tight pricing and great client intimacy. We have chosen a few partner banks very carefully and use them as conduits through which we lay off aggregated risk, the aim is to build close relationships with these banks in the same way as we do with our clients.
Our strategy of organic growth and acquisition of country banks further extends our franchise, and this growth of high volume small notional tickets increases the requirement for an appropriate E solution. The dramatic growth of our Global business means increasing economies of scale and pressure to lower costs via STP solutions, this innovation in turn benefits our home market and branch network.
Some 7 years ago Rabobank International adopted a so-called business-cycle approach. This strategy revolved around examining the daily recurring activities performed within your clientsÃ¢â‚¬â„¢ Treasury departments and defining how and where the Bank could assist by providing the proper tools. Are you still applying this approach and why did it lead you to develop a portal rather than a sole trading platform?
Rabobank is a strong believer in client intimacy. Our company structure supports a local client approach through relatively independent branches. Based on this approach, the bank will continue analysing the daily activities of our clientsÃ¢â‚¬â„¢ treasurers. Nowadays, it is important to offer more than trading functionalities. Our new platforms will support aggregations of trades, netting, but will also create easy connections to our clientsÃ¢â‚¬â„¢ back office and cash management systems. E-platforms can only be successful if they are built for and even with their users.
In your Rabo Treasury Web portal, Market Information (rates, news, research) and Reporting/ Reconciliation tools are made available side-by-side with your transaction services. Why are clients increasingly drawn to this type of holistic e-service environment?
We found out that our platforms and back office applications allowed us to quite easily develop tools like a Mark-to-Market calculator, a liability management tool and an IFRS calculator. Clients appreciate these tools as they experience complementary trading services that meet their requirements.
Rabobank recently re-launched its official website www.rabobank.com. What new navigational features have you introduced onto the site?
The new Rabobank.com website is built as an integrated environment for all of our wholesale clients. Instead of having a product (and thus department) oriented approach Rabobank chooses a client focus which is reflected in the way Rabobank.com has been set up. In the nearby future, this wholesale environment will also feature a secured transaction environment in which several products like treasury and financial logistics services will be offered in an integrated way.
RaboDealAssist is Rabobank's online treasury system enabling customers to conduct real-time Foreign Exchange and Money Market transactions online. The system was previously only available to Benelux corporate clients of Rabobank Global Financial Markets. What plans do you have to expand the coverage of the system to customers worldwide?
RaboDealAssist is about to be upgraded. It might even be re-branded. RaboDealAssist is a very important platform servicing SME clients directly or through the bankÃ¢â‚¬â„¢s member bank network. It was designed to process a large number of tickets with small notionals but it no longer fully supports the requirements that these clients have.
With new products and functionalities on a state-of-art platform the bank will be able to attract new treasury clients and expand its coverage to other countries as well.
Although a considerable portion of your treasury income is derived from use of e-platforms, it doesnÃ¢â‚¬â„¢t yet constitute a majority due to continuing use of telephone based trading with many of your existing, smaller sized corporate clients. Do you think these statistics may change in the future or is relationship-based banking likely to represent a continuing throttle on uptake of e-FX by certain customer segments?
Rabobank is a bank with the flexibility to adapt quickly to clients needs. Due to the co-operative structure our client-facing entities have always been relatively autonomous to tailor their offerings to local requirements. However, our treasury challenge is to convince those clients about the advantages of electronic trading with sophisticated platforms that provide users with a high level of information, analysis and trading tools.
Given the bankÃ¢â‚¬â„¢s high volume of relatively small tickets and a pressure on costs per ticket, the advantages of building economies of scale with better platforms are considerable.
In this edition of e-Forex we have been focusing on the Pension Fund sector and their developing interest in FX. Last year Rabobank introduced an online service for Pension Fund Managers called the Collateral Management Tool (CMT) offering a support function to help meet a new set of regulations associated with Assets and Liability management. Do you think Pension funds will play a significant role in the future development and uptake of electronic FX?
An increasing number of our pension fund clients see FX as an interesting asset class to focus on. E-platforms will help us supporting this growth opportunity.