Substantial shifts in global trade flows have led to increased volatility and risk for corporates trading in the emerging markets, says Katharina Michael, Head of Trade Finance Sales Germany at UniCredit in International Trade Magazine. Collaboration and digitalization are therefore crucial to helping banks meet the growing demand for risk mitigation in these regions and ensure their clients are being served – even in the most testing conditions.
For example, the use of syndicated loans is enabling banks to share risks, while wider industry collaboration is bringing various digital solutions and initiatives to the market. Currently weighed down by slow and costly paper-based processes, this shift to digital trade finance processes will help to accommodate the extra demand in emerging markets, with products such as the Bank Payment Obligation and the Electronic Bill of Lading increasing both speed and efficiency in corporates’ financing processes.
The full article was published in the February/March print edition of the magazine.
Against a backdrop of low borrowing costs and increased scrutiny of financial key performance indicators (KPIs), large corporates are turning to comprehensive working capital management techniques such as receivables and supply chain finance to release working capital, shore up balance sheets and create more robust and efficient supply chains.
However, many corporates have struggled with onboarding their suppliers to such programmes, restricting adoption rates and limiting programme success – despite the potential benefits.
Adeline de Metz, Head of Supply Chain Finance Solutions at UniCredit, writes in Trade & Receivables Finance News about the important role banks have in ensuring a smooth supplier onboarding process.
To read the article in full, please click here.
In the context of unprecedentedly low borrowing costs, and growing corporate emphasis on key performance indicators (KPI’s), large companies are increasingly utilising working capital management techniques such as supplier financing as a means of improving their balance sheet and enhancing trust, stability and efficiency in the supply chain.
However, while large corporates increasingly recognise the value of supply chain finance programmes, many have experienced difficulties onboarding their suppliers to such programmes – reducing the benefits for all involved.
Writing in Global Banking and Finance Review, Adeline de Metz, Head of Supply Chain Finance Solutions at UniCredit emphasises the important role banks must play in helping to smooth supplier onboarding:
“By investing in robust digital platforms that bring simplicity, transparency and speed to the complex on-boarding process, and tailoring working capital programmes to the needs of individual suppliers, banks can help corporates establish workable supply chain finance programmes – in turn creating a more efficient, trusting and profitable environment for all.”
To read the article in full, please click here.
Both investor interest and corporate issue sizes in Germany’s famous private debt market – the Schuldschein market – are escalating at historic rates, say Jörg Stührwohldt and Rudolf Bayer, managing directors at UniCredit, writing in Investment Europe. Indeed, in the first 10 months of 2016, volumes have soared to more than €20bn, already touching record annual levels with two months left in the year.
In large part, this phenomenon has been driven by increased investor demand. With macroeconomic volatility and negative interest rates squeezing margins in the bond market, the Schuldschein offers an attractive means of diversifying investment portfolios – not least because its contracts, unlike bond contracts, protect against the impact of negative rates, through the widespread inclusion of zero floor language. High investor demand, has in turn, increased the attraction of the Schuldschein market for issuers. In fact, corporates are reacting by carrying out ever larger issues, with ticket sizes even exceeding €1bn in some cases, as they look to seize the opportunity to borrow money at favourable pricing.
In 2016, the market is booming not just in terms of volumes, but also in terms of its international reach. Around a quarter of issuers now hail from outside the classic regions of Germany and Austria, while much of the new demand is coming from Asian banks as well as international institutional investors, tempted by larger deals with higher spreads.
To read the full article, please click here.
Outward foreign direct investment (FDI) is on the increase among European corporates, but as they look to expand their reach into new markets, these firms must find ways to overcome a number of challenges, says Gianfranco Bisagni, Co-Head of Corporate & Investment Banking at UniCredit, in TMI’s new transaction banking guide, Going Global, Going Digital.
Outward FDI is on the right side of an impressive trend in recent years, with outward flows outpacing worldwide trade volumes by 1,400% between 1980 and 2014. And looking ahead, German and Italian multinationals are expected to double their foreign investment activities by 2030.
Certainly, there are strong incentives for investing overseas – not least the prospect of providing more focused and comprehensive services to international clients while avoiding transportation costs, tariffs and exchange rate volatility.
Yet to realise these benefits, corporates must contend with the unfamiliar customs and regulations of foreign markets, as well as increasingly complex cash positions, new counterparties and a growing number of accounts. Advanced digital technology, however, can go a long way towards easing these pressures, with products such as virtual accounts drastically simplifying the process of managing, opening and closing an expanding set of accounts. Strong local knowledge will also be of vital importance – enabling corporates to negotiate the idiosyncrasies of individual markets and capitalise on the opportunities they present.
To read the full piece, please click here.
UniCredit, in collaboration with Commerzbank’s London offices, has carried out the first BPO live transaction – processing the export of a shipment of chemicals from Heraeus Metal Processing Ltd. to Ecocat Italia Srl, an automotive parts producer based in Genoa. Previous transactions between the two were handled by open account invoice, secured by a bank guarantee.
A new digital settlement tool in international trade – backed by SWIFT and the ICC Banking Commission – the BPO consists of the irrevocable undertaking of the obligor bank towards the recipient bank to effect the relevant payment as the invoice falls due. The payment is made under the condition of successful electronic matching of trade data between participating banks on the SWIFT Trade Services Utility platform.
As a financing instrument the BPO is highly valuable – enabling corporates to secure finance at various stages in the settlement process. Although a new instrument in trade finance, the BPO holds great potential, particularly in facilitating supply chain finance. Positioned as a hybrid instrument between a letter of credit and open account, the BPO enables greater flexibility in dealing with terms of contract, allowing transaction to be adjusted at short notice.
“We have put great effort into improving the availability and convenience of the BPO for our clients”, says Raphael Barisaac, Head of Trade Products at UniCredit. “Through the creation of a fully digitalised BPO execution platform we can offer our clients a solution which combines automated processing of the flows with careful cost management, prompt payments and financial options for the seller.”
News of the landmark transaction spread across the specialist finance, treasury and financial technology press, picked up by: Treasury Management International, Trade Finance, Global Trade Review, Banking Technology, Finextra, Global Banking and Finance Review, PYMNTS, Publi-News, The Paypers, Trade and Export Finance, Commercial Payments International, and FinTech Finance.
Moorgate’s clients came away from this year’s Trade & Forfaiting Review Excellence in Trade Finance Awards with an impressive haul of five wins as Deutsche Bank, ICC Banking Commission, UniCredit, Falcon and Commerzbank all received gold accolades.
In a revised format whereby only category winners are recognised, UniCredit triumphed in the close-fought contest for “Best in Central and Eastern Europe”, on the back of their innovative digital solutions and deal flow. Commenting on the bank’s achievement, Enrico Minnitti, head of CEE corporate and investment banking said, “UniCredit continues investing in technology and focusing on improving customer service to be able to offer a state of the art user experience”.
Meanwhile, Commerzbank walked away as winners of the “Best in Germany” category. Reflecting on the bank’s commitment to offering clients quality insights into both regional risk and practices, Commerzbank’s Rüdiger Geis, head of product management, said, “with the euro looking strong but crucial Chinese demand remaining slack, German companies – and especially those in the Mittelstand, or SME, sector – need the support of their banks’ expertise more than ever.”
The ICC Banking Commission received the “Shining Example of Innovation” Award. The ICC Trade Register – created to support the ICC Banking Commission’s shaping of the industry via regulatory proposals and to raise awareness around low-risk trade finance products – now covers 1.3 million trade transactions worldwide and provides a comprehensive outlook on both the risks and opportunities present in the trade finance arena.
Elsewhere, Deutsche Bank retained their gong in the “Best Trade Bank in Structured Commodity Trade Finance” category, as managing director, John McNamara, hailed the bank’s success in a year of particular scrutiny for players in the commodities market. Also building on previous success at the awards was Falcon, which were named the “Best Specialist Trade Finance Institution” for a sixth consecutive year. The specialist financier has provided finance upwards of US$10 billion to companies worldwide in order to enable them to achieve their growth ambitions.
To view the full list of award winners in TFR’s July/August edition, please click here.
Though liquidity has become cheap among large corporates, the need to optimise working capital remains as pressing as ever. Yet as treasurers look to keep their balance sheets in check, they face mounting pressures in other areas and must be wary of succumbing to excessive workloads, writes Alfredo Bresciani, head of trade finance international sales at UniCredit in Global Trade Review.
As they look to negotiate this tricky situation, treasurers can turn to new digital tools, which can help expedite the execution of critical working capital management techniques – freeing time for them to attend to their growing list of tasks.
Far more than just a solution to a problem, however, these tools also open the door to huge operational efficiencies – with the ability to revolutionise account management, ensure quick and safe settlement, and provide critical insights into potential areas of improvement.
To read the full article, please click here.