Paris, France
September 21, 2006Trade
Finance at Regional Banks: What Are the Options?
Report Published by Celent
During the past five to ten years, the
trade finance business has changed dramatically. New technologies, and the
acknowledgement by leading players that trade finance tools needed some
nip and tuck, have puzzled market participants.
In a new report, Trade Finance at Regional
Banks: What Are the Options?, Celent examines the strategic options for
regional banks that want to remain in the trade finance business. The
report explains why the question of trade finance’s future is crucial,
and it provides detailed information and analysis of the strategies to
revamp trade finance departments (especially centralizing trade finance
operations) and the steps to implement it. The report also includes three
short case studies of trade finance strategy.
According to Axel
Pierron, Celent analyst
and author of the report, “Leading trade finance specialists, such as
ABN AMRO, JP Morgan, and the like, are betting on acquiring market share
from regional banks either in a friendly way by insourcing other banks’
trade finance operations and in a more aggressive way by starting a war on
price and services. This leaves many regional banks puzzled about what
should be their trade finance strategy, and wondering if there is a future
for them in that business.”
The banking community feels the winds of change in
the trade finance business. Very few banks, regardless of their size, are
doing nothing to change their trade finance operations. According to their
future strategy regarding trade finance, banks have three main choices:
centralising trade finance operations, outsourcing trade finance
operations, or doing nothing.
Pierron adds, "In order to compete in the trade
finance space, regional banks need to leverage their existing assets, such
as customer relationship, granular networks, and expertise, by
centralising their trade finance operations. This will dramatically
increase the quality of customer service and open opportunities for strategic development, not to mention
achieve tremendous cost savings.”
Cost savings should not be the
only aim of trade finance centralisation, but Celent estimates
that a bank could decrease its transaction cost by 13% and its IT
management costs by 18% through implementing such a strategy.
The 49-page report contains 22 figures and one
table. A table of contents is available
online.
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About Celent
Celent, LLC is a research and advisory firm
dedicated to helping financial institutions formulate comprehensive
business and technology strategies. Celent publishes reports identifying
trends and best practices in financial services technology and conducts
consulting engagements for financial institutions looking to use
technology to enhance existing business processes or launch new business
strategies. With a team of internationally experienced analysts, Celent is
uniquely positioned to offer strategic advice and market insights on a
global basis.
Media Contacts
New York - Arielle Weliky
aweliky@celent.com
Tel.: +1 212 269 7547
Paris - Alexandra Vouge
avouge@celent.com
Tel.: +33 1 42 61 06 88
Tokyo - Junko Nose
jnose@celent.com
Tel.: +81 3 3507 5696
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