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Working Capital. Rob van Paridon, SEVP Global Head of Working Capital. 11 December, 2003. The integrated ABN AMRO Working Capital offer. - PowerPoint PPT Presentation
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The integrated ABN AMRO Working Capital offer
Our Working Capital offer integrates ABN AMRO’s expertise in cash flows, liquidity, global trade, financial markets and asset management to
meet the current demand for tailored working capital solutions in the market
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Bringing together our expertise in Working Capital Solutions
Cash Flow Advisory: Payments, collections, online transactions and reporting, current accounts, links into ERP systems
Global Trade Advisory: Risk mitigation, trade finance, trade document management and supply chain facilitation
Financial Markets: Advisory services on debt capital management and treasury services
Liquidity Advisory: Fund concentration, including netting, pooling & zero balancing and investment of surpluses
Asset management: A range of short term structured investment options
Our relationship bankers and sales consultants draw on this range of expertise to build solutions for the clients
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Recognised by the market in all aspects of Working Capital
We are recognised for quality and innovation across the Working Capital landscape:
April 2003Best Provider Outsourced Treasury Solutions in Europe(Treasury and Cash Management Awards)
November 2002No. 3 Overall Best Global International Cash Manager (Cash Management Poll)
June 2003Best Structured Trade Bank
November 2002Best Bank in FX in the Eurozone (voted by corporates)Best CLS bank ***
January 2003 Currency Derivatives House of the Year Award
April 2003Best Bank for Liquidity/Working Capital in Europe(Treasury and Cash Management Awards)
June 2003Best Online Trade Finance Provider
The Banker
September 2003
Best use of IT in wholesale
banking
November 2003No. 1 Cash Management- Western Europe (Cash Management Poll)
November 2003 & 2002No. 1 Best Electronic Services in Trade Finance
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Building for growth and profitability
Operational Excellence Centres of Operating Excellence Optimising low cost delivery
locations
Targeted Client Segments Leverage competitive FI position Priority & Key client focus
Client Experience Making customer service a
competitive differentiator
Geographic Focus Invest in identified growth markets Follow our clients around the world Leverage footprint, targeting
outflows
Integrated Working Capital Solutions
Risk management: Credit, Country & FX
Embedded Foreign Exchange
Liquidity & Asset Management
Outsourcing
Integrated delivery channels (Portal)
Payables and receivables management
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2003 Product Revenue Composition 2003 Client BU Revenue Composition
Source: BU Finance--Working Capital
Steady revenue growth in core businesses
Growth from diversified industry segments
Core Working capital Businesses show consistent growth despite challenging FX, interest rate and global geo-political environment
Diversified revenue base - growth from all client segments through strong alignment between Client and Product BUs
Futures12%
Global Custody
4%
CFA55%
Domestic Custody
5%
GTA24%
Industrials28%
FIPS49%
TMTH10%
Integrated Energy13%
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Source: BU Finance--Working Capital
Working Capital Current Targeted Growth Markets
Russia India China Turkey
Emerging Markets help drive faster growth
2003 Geographic Revenue Composition Growth Markets Focus
Attractive profitability dynamics
Local banks lack the solid ratings
enjoyed by ABN
Attractive GDP growth rates and new
client acquisition opportunities
Increasing in-bound investment by our
Priority & Key clients in these markets
Leverage network for competitive
advantageCentral & Eastern Europe
6%
Western Europe
48%
Asia Pacific9%
Latin America
6%
North America
31%
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Building on established customer relationships
Length of relationship with AAB Working Capital franchise has long-
standing client relationships. Two-thirds
of our global balances are generated
from clients that have been with the
bank for over a decade
7% 5%
88%
20%24%
57%
10% 10%
81%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
<5 5-9 >9
Years with AAB
% o
f b
ala
nc
e v
olu
me
EUR USD TOT
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Increased focus on Financial Institutions
ABN AMRO is well placed to become one of the leaders in the industry for
the delivery of Outsourcing / Strategic Partnership services
– global presence, outstanding brand recognition and award winning product capability
– not seen as competitive threat by local banks
– track record of delivery
– cost pressures in the industry requiring focus on core-competencies
Sixty percent of mid-tier FIs will outsource (part of) their non-strategic
processes (source BCG payment study & Deloitte Consulting)
Demonstrated success
– GTA has established 32 insourcing relationships in US, Asia, and Europe
– lite outsourcing deals won by CFA including X-border payment processing, CLS white
labelling and Corporate Account Services
– FX: initials steps made and a small number of mandates won
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AMERICAS
CFA
GTA
Client Service
6
39
10
EUROPE
CFA
GTA
Client Service
22
24
20
APAC
CFA
GTA
Client Service
12
57
12
INDIA
CFA
GTA
Client Service
13
2
1
% FTE in hubs: CFA 11.3 %; GTA 0%; CS 0%% FTE in low cost sites: CFA 2.2%; GTA 2%; CS 19%
Processing / service centers 2000
Improved profitability through cost-efficient delivery
Working Capital is executing its strategy to structurally reduce its costs base through
hubbing and off-shoring its processing activities
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Hubbing will further enable the low cost volume growth necessary to grow margins
and to deliver efficient service and reduced unit processing costs
AMERICAS
CFA
GTA
Client Service
Hub
1
2
2
EUROPE
CFA
GTA
1
1
1
APAC
CFA
GTA
0
0
1
INDIA
CFA
GTA
1
1
1
Major processing / service quality centers (sqc) 2005
Client Service
Hub
Client Service
Hub
Client Service
Hub
% FTE in hubs: CFA 34 %; GTA 85%; CS 55%% FTE in low cost sites: CFA 25%; GTA 65%; CS 24%
In order to stay close to the customer, local touch points will be maintained in local markets
Improved profitability through cost-efficient delivery
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Integrated access through a single delivery platform
New Integrated Delivery Channel Cash Flow Advisory Global Trade Advisory Financial Markets
Superior user experience Single sign-on Intuitive workflow Application not web-site Push technology and alerts Real-time updates Personalisation Multiple views Permanently on the desktop Maximise data, minimise branding on desktop Multi-bank
Working Capital Access brings together the Global Trade Portal (MaxTrad™), Cash Online Services and Financial Markets, following the workflow of a treasurer
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It’s Working Capital’s ambition to become “best in class” service provider in wholesale banking
Source: TRI*M index, NFO Worldwide"
Making client satisfaction a competitive differentiator
Working Capital has
established a process that
carefully tracks how clients
rate our performance
Annual and quarterly
Surveys
We have standardised
service processes to
increase the speed of
responsiveness to requests
A differentiated service
model for our 250 most
important clients with
dedicated service
consultants
762004
CEE
752003
732004
Asia
672003
642004
EMEA
552003
652004
US
582003
752004
Latam
722003
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Source: Euromoney cash management poll November 2003
Euromoney Cash Management Poll Shows improved competitive position
As ranked by European Corporates... Competitive position has improved over
2001 - 2003
ABN AMRO has seized competitive
ground from rivals in market share
– voted number 1 in Cash management in
Western Europe up from number 3 in 2002
– voted number 2 in Latin America, up from 4 in
2002
– voted number 3 globally Vs. number 4 in 2002
55%46%
37%
30%
21%
14%
18%
30%
15% 19%9%6%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2001 2002 2003
Citigroup Deutsche HSBC ABN AMRO
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Working Capital is well positioned to drive growth
The business is focused on a clear strategy that leverages core
competencies and reinforces our competitive advantages
– global network and a well established brand
– integrated solutions across conventional product silos
– proven capabilities and their success transfer to emerging markets
– focus on established Priority & Key client relationships
– service differentiation
– cost management through hubbing and off-shoring
Market and customer surveys demonstrate improved market
position
Financial results validate the success of this approach