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[Music] hello and welcome to the bankers webinar announcing the winners of the transaction banking awards 2020. i'm joy mcknight managing editor of the banker in addition to celebrating the leaders in transaction banking i'm pleased to have several industry experts joining me via video link to discuss trends in the transaction banking industry so first i'd like to invite my panelists to introduce themselves hi joy thank you for having me francesco burally i'm a partner at albright consulting where i specialize in payments transaction banking and digital business models hello everyone my name is eric lee i look after banking research for coalition development which includes cash management trade finance and security services coalition is a market leading business intelligence provider for the corporation investment bank industry hello you know kelly i'm the global head of doing transactional banking at oliver wyman a global management consultant my name is mark smith i head up the treasury and trade solutions business for the emea region at city so going back to basics the role of transaction banks is to underpin the world's trade and commerce oiling the wheels of the global economy and it's this role in supporting business through payments liquidity and cash management supply chain finance and trade finance that really comes to the fore in a crisis like covid19 even during the global financial crisis of 2007-2009 a crisis originating in the financial sector it was the transaction banking side of the business that provided the stability and the continuity needed to get the world back on track and into recovery mode and while transaction banking may not move as quickly as retail banking when it comes to digitization the transformation has certainly begun and innovation is beginning to pick up pace impressively many of the submissions for this year's awards included new products and services aimed at responding to evolving corporate and fi client needs during the global pandemic so before we get around to the first set of category winners let's start by exploring the trends our panelists are seeing in the industry whilst it feels a long time ago and now pre-pandemic uh trend was sort of one of i guess moderate top-line growth within the transaction banking industry but i think underneath that you would see some quite significant acceleration of change by clients and the market overall so if i just elaborate on those two or three different themes i think that which were changing pretty substantially clearly going into the pandemic you still had a lot of the concerns still around the geopolitical space trade walls and the shifting global supply chains and commerce as a result so that was one of the themes i'm sure we will touch upon it later in this but another theme was around digital disruption really reshaping industry ecosystems and that was supported very much by sort of rapid advances still in technology changes in financial services overall a good example of that as well is the instant payment landscape that was accelerating uh very quickly as we went into the pandemic you had tax changes the third one and the bets reforms really rippling through corporate business models and then you also had with the faster growing emerging markets those are continuing to be a pretty significant driver of corporate revenue growth so that's the the fourth thing that i could say you know pre-pandemic um were very much out there driving a lot of change within the transaction services space so whilst a lot of change has changed in the last nine months or so as kovid 19 had its impact there were still a lot of pretty significant shifts in commerce and banking ahead of that and some of those themes very much almost accelerating as we went into the pandemic and eric from your perspective you know what were you seeing as the major trends in the industry there were a few hiccups leading up to the pandemic so in 2004 2005 we saw the china gdp decoupling that was one of the major hiccups for the industry but besides that the industry has actually enjoyed uninterrupted growth for the past decades or so so that is why i think that there has been a lot of enthusiasm views around this industry as well as how the industries actually help the global economy to facilitate even further i think that one of the things that from my perspective is a lot of the things what's happening underpinning the all the business strategies we've seen around this industry is globalization i think that was the key words for the past 10 decades and the people has actually been able to bring it further and actually brings us a benefit to all of us as a consumer as well so obviously that thing has changed a little bit since the start of the trade war now the pandemic has actually changed the supply chain finance strategy a little bit further down the road so we are here to see what is actually the impact of the industry as well as how the industry is going to respond to that okay so let's fast forward now into the past six months and how the covert 19 pandemic the global lockdowns that have happened since then how that's really impacted uh the transaction banking environment ronan what is your take on that i think it's pretty clear the pandemic has presented a pretty key challenge to the industry overall so uh net interest income has collapsed across the industry as central banks have uh cut policy rates to negative or near zero so we saw in the first half uh global's transaction banking revenues down around eight percent on on the first half of 2019 despite uh deposit volumes at elevated levels so economically it's had a a pretty material impact on on the business and leads to some fundamental challenges as to how to balance some of the things that mark was talking about that existed pre-codered so how to balance near-term economics of the business uh with investing for the future and investing in digital transformation we've also seen a pretty radical change in terms of how corporates are interacting with their banks so their needs have certainly changed but we've seen a radical shift to digital channels an adoption of digital channels that already existed but perhaps weren't fully used uh an increased focus on real-time liquidity it's it's a topic that um that many have talked about for for many years but in an era of abundant liquidity pre-crisis that hasn't been uh quite so critical for many corporate treasures and you know i i think at the lower end of the markets questions about the end of cash right is this a trigger that that that moves people towards digital uh digital currencies and the end of physical cash and francesco uh you know do you have any remarks in terms of that you know move to digital away from cash what are you seeing to take it to a level deeper now we have a situation where trade is a behaving with a k shaped trend there are some parts of the industry that are doing pretty well like anything related to health for example while other industries uh for the time being under eyes or going down down the drain or facing different type of challenges now in this type of context supply chains have been completely disrupted we have clogs imports of the volumes of availability of various travel diminished we have a resurgence of rail uh transport and and so on so this is becoming a very patchy uh type of landscape where the common trend from cooperation is in need of improving their workflow and working capital management in this we have also the remote working and that has taken uh the demand for digital solution digital touch points up to to the roof where banks had to adapt very very quickly to being able to let client operate from a distributed environment logistically it is creating different type of challenges in terms of access to uh applications that could have been installed centrally within the perimeter of a corporate as well as different type of security challenges in terms of managing authentication uh replacing operations that were two degrees still dependent on paper that is sitting somewhere in the office that nobody can can access then on top of this we have to say that the pandemic is creating a lot of significant pressure in terms of finances both at individual as well as business levels we have corporations that still have to uphold the expected quarter result the value of shares and so on and all of this is creating within the current environment a resurgence of risks that we haven't seen to the same level of magnitude for a long time uh related to behaviors that can be debated or uh can can be uh how can i say not considered to be 100 accounting uh correct correct in accounting perspective so all of a sudden the landscape as a completely different set of layers of complexity okay so both yourself and ronan talked a little bit about some of the challenges that you know financial institution and corporates are facing you know how best can their banking partners really respond to their needs you know what is top of the list mark to quote one of the uh large ceos of a tech firm i think in the quarterly announcements that they had they expressed that you've almost had two years of digital adoption within the space of two months so that's really enabled an acceleration of the embracing of a number of digital connectivity that our clients have and certainly from our city perspective as as one can imagine very focused on using that as an accelerator for adoption of clients and it's that resilience it's that operational resilience capability um that through digital forms that you can really build and grow that and make it a lot sounder so for instance um our digital account onboarding capability accelerated pretty substantially and we've got now well over 50 percent of all of our accounts in the emir region purely opened on digital rails so gone are those days of web signatures gone are those days of paper going backwards and forwards and obviously that's not only a digital embracing but you know also just the very logistics of paper of postal all of those things that were in people's minds but again this pandemic has really accelerated that so banking partners absolutely helping um with that adoption to to enable our corporate treasurers uh to be a lot more efficient in that then then i'd also sort of touch upon one of the areas that i feel as though our client base has been focused on at the early stages of the crisis was again about their response their their marshaling their corporate liquidity restoring balance sheet uh looking at the cash flows uh through the new lens of the earnings that they they feel as though they've got at least some predictability to so again looking at those cash flows managing that risk managing the controls particularly when you look at what was happening in the market with pretty substantial change in fx rates changing interest rates as well uh corporate treasuries most definitely need to be on top of that um then i would say one thing that we've been working with clients about is almost using this crisis to create a lot of disruption creative disruption within their organization and there's that using this as a catalyst to innovate uh redeploy capital uh towards different growth opportunities and certainly when we look at our client base more and more movement i would say towards that c2v space so consumer direct buying that's a trend that we've seen and we as city very much helping our clients in in that collection space and that visibility and that becomes very much a different volume play from the from the number of payments the number of collections versus the traditional b2b route so a number of areas that we're really trying to help clients uh and very much we've seen that client embracing in a number of the different themes that have come up from the uh from the panel partners and ronan uh what would you say in terms of what are you seeing across the market in terms of the banking partners really responding to what the financial institution and corporates need as mark said i think it comes down to fundamental corporate uh nfi needs and at the apex of the crisis it was really about access to liquidity certainty of liquidity and visibility of liquidity um and that's both in terms of optimizing cash balances around the globe so again that that's always been a trend but it became much more acute as a priority as well as access to uh to financing uh on the lending side um and what we saw in the early days is um pretty rapid drawdowns on revolving credit facilities um and and other financing instruments that were then often placed back on on deposit with the same institutions whilst some of that has subsided um and you know i think what we've seen is that there is greater uh comfort with how the pandemic is going to evolve for individual corporate so they've got better understanding of of the cash runway they need that that need for certainty of liquidity and the ability to visualize and understand their liquidity needs particularly if we see the pandemic evolving in uncertain ways around the globe perhaps second lockdowns in different markets what we'll see is an increased need to have visibility of that liquidity a second theme that we've seen coming through is around supply chains so again supply chain visibility and integrity uh as we've seen different markdown patterns affect uh suppliers the need to extend financing to those suppliers via supply chain finance programs the need to see and understand distress through the supply chain and potentially substitute for alternative suppliers have become important themes for corporates managing through the crisis and eric do you have anything to add sure so i think my fellow panelists talks a lot about the corporate behavior that they want a little bit more financing and liquidity needs and their supply chain sort of strategy because of the pandemic what i actually want to say is actually different client segment industry has so different needs and what it wants nowadays i think we probably all know that what nowadays british airways as a corporate their needs is fundamentally different from amazon and what central bank of nigeria needs is very different from british government so if i just say that at the coalition we are a market observer what we see that the banking partner has been instrumental of assisting their client to go through the funding go through this pandemic crisis if i put corporate aside look at the segments that we have not talked about yet first of all what's happened to the fi if you think about the market opportunity market volatility since the end of the middle of march and all the craziness that we've witnessed in the emerging market the financial institutional clients definitely needs one thing access they need access to a lot of things they need access to to sort of the market debts they need access to the source of dollar they need to access a lot of things and the banking partner in this sense actually can help a lot to bring the sort of to make sure that the financial system over country of a big financial institution be the bank or as manager is actually can can survive the second other supply segment is the government or public sector i think we all heard a lot about the u.s cast act the ppp program in the uk we have the small enterprise bounce back loans how do these things happen you need the banking partner actually to deliver all these solutions to the small corporate to the american workers or to the british workers or workers in every single other country i think this is another thing that the banking has been the banking partner has been the unsung hero in this case we all heard about the grand gestures from coming from all the governments but but it is those banks that you have relationship with will deliver all of these financial support to you and this is the things that people don't talk about in this industry at the moment so thank you so much for your industry insights now let's announce the category winners in the cash management category the winner is cimb it's very difficult to take on the big entrenched players but this year cimb made such a huge leap forward that it should be rewarded the malaysian bank ramped up its offerings in its home marke s including launching biz channel at cimb mobile banking app virtual accounts with apis for real-time cash flow management and foreign exchange contract rate online booking in the payments category the winner is city city has really stepped up its game in payments this year with the launch of city payments insights for digital tracking and self-service capabilities it also launched spring by city its digital consumer payments business which supports the changes in merchants business models by offering the ability to collect from a wide range of bank and non-bank payment channels it broke new ground with the launch of cross-border instant payments in the securities services category the winner is hsbc hsbc tipped the scales in its favor with the launch of digital vault a custody blockchain platform to digitize the transaction records of private placements which will allow access to these records quickly and efficiently it has also made investments into its middle office capability including trade management and settlement control increased instrument coverage and otc derivatives processing and improved investment book of record reporting capability hello i'm alekra berman head of institutional sales and co-head of security services at hsbc i'm delighted to accept the banker award for best bang for security services and on behalf of my co-head richard godfrey and the entire team at hsbc thank you this means so very much to all of us 2020 has been an incredibly challenging year and richard and i have been amazed by the sheer resilience and adaptability of our clients our colleagues and the industry as a whole as we have tried to navigate through these uncharted waters together our clients need great connectivity rapid and reliable access to comprehensive information and more choice over how they experience and consume data our investments in digital and data have targeted these areas bringing a number of exciting solutions to market over the past year our strategy of continuous technology-led transformation means our clients can expect to see a stream of exciting new developments over the coming year thank you to the banker for recognizing the commitments and achievements of our passionate talented and dynamic team at hsbc and thank you to our clients who continue to partner with us on innovative solutions which are helping to drive our industry forward in the supply chain finance category the winner is unicredit unicredit has expanded its reach and integration through a new supply chain finance digital platform in partnership with talia it has also supported its clients with dynamic discounting through its partner fin dynamic and it has also adopted existing solutions allowing the italian bank to respond quickly to clients needs during the covid19 pandemic in the trade finance category the winner is standard chartered standard chartered strives to be an innovator in trade finance earlier this year it completed the first remmb denominated international letter of credit over blockchain there's also the first financial institution to partner with trade lens an open and neutral blockchain based platform which is a joint venture between ibm and maersk shipping lines while the transaction banking arena has been slower to change and adopt to new technologies compared to retail banking for example today it's undergoing modernization focusing on when it can where it can deliver true value to corporate and financial institution clients and it's clear that banks are driving digitization across the regional and global footprints and that the covet 19 pandemic has accelerated this drive so my first question for this part of the webinar is how are the investments that the banks have made in their digital transformation journeys making an impact in the transaction banking space and francesco i was going to address this question to you first so i would distinguish two layers yeah a tactical layer and a strategic layer a tactical layer as we discussed already there is a great need of visibility for liquidity positions for the ability to work remotely eliminating paper from the process and so on and this is where some of the investment in digital that has been undertaken so far is starting paying dividends on the other side from a strategic perspective we moved from an environment where corporations were thinking of adjusting time type of perspective into a just in case type of planning and in here we have a number of different directions that the corporate treasury needs and requirements are going to to evolve into first of all there's going to be more need to understand better how the supply chain and is going to to evolve and for example in finding alternative sources of liquidity alternative clients adding support in what we are going to see or expecting to see as a regionalization of some of the supply chains that have been trending toward global global integration up to now but there's going to be there's been a reverse because of the geopolitical risk and now given the painful experience of of the the covet and the lockdowns we're going to see a bit more of that so on the side of the the strategic strategic level there's going to be further integration much more advisory coming up in terms of integration within corporate in terms of the overlay uh framework and organization of the supply chain itself now in here we got some common technology teams that are being valid before the coveted experience and are valid now at present so first of all the centrality of apis in terms of enabling the lowering down of barriers between silences in terms of information access as well of execution within organization and across organization we have significant investment coming up in blockchain technology transaction banking and supply chain is an area where blockchain is proving to be the most conductive and the most promising area of application ever and here we have a number of different solutions that are coming out of the proof-of-concept pilot into industrial production and then finally we have the yet not yet fully exploited capabilities of artificial intelligence and advanced analytics that are going to be very much key in letting corporate optimize their liquidity position and improving their cash flow uh picking up trends that may not even be obvious at the um on the other side but by pulling together information information data and data pools from different perspectives from transaction uh supply chain insight industry and so on banks would have the ability to add a lot of value to treasuries in the way they plan their operations and their decisions and ronan do you think that the digital transformation that the banks have made do you think it's you know where is it making the biggest impact in transaction banking how far has it really gone there's a lot of work going on across the industry uh some of the largest uh transaction banks have spent north of a billion dollars over the past few years in terms of digital transformation and technology transformation but has all of that resulted in in demonstrable impact either for clients or or for the bottom line yet i think the answer is it's mixed some of it has some of it hasn't a recent survey we did of um of banking investors um suggested that digital transformation is not widely valued by the investor community at the moment because they can't they can't really see the results um and there isn't sufficient transparency on it so whilst there are certainly some game-changing investments happening today francesco mentioned um the transformative power of blockchain uh as well as artificial intelligence i think i'd argue that some of that hasn't yet fully come through in terms of impact yet it has great potential but has it impacted the industry or or or customer benefits yet perhaps not really where we see most of the nearer term impacts happening are on perhaps more basic things like improving digital channels and the ways in which uh corporates and fis interact with their banks both to initiate transactions to onboard and initiate relationships uh and to manage reporting uh we're seeing a lot of focus and an impact on digitization of core processes like onboarding basic things like document management and credit processes um and underpinning all of this is a fundamental transformation in the underlying technology fabric of transaction banks this is the unglamorous but fundamental part of the uh part of the transformation these i transition to an api enabled technology fabric one that's more cloud-based and one that's much more modular and enables transaction banks to partner um with third parties and to uh embed new digital uh technologies much faster excellent and mark would you agree with ronan's assessment as ronan just sort of walked through some of those points i was sort of nodding my my head in agreement because in many cases uh certainly our corporates you know they're all people and they all have that sort of retail consumer experience with uh with many of uh the banks that they will bank at from that personal perspective and then it's a case of when they move into their their corporate life their their work life how how that same experience can can filter through as well so you know as was pointed out certainly from a a city perspective we've been very focused on that client experience and that client experience is is quite broad it's the key points that have just been referenced right how quickly can you open an account you know the documentations that i have is it long is it drawn out is it too um too much there uh to absorb but there are lots of repeated um phrases a lot of repeated terms in all of the different legal documents so city as a very global bank we've also been looking down at the country levels to see right even at the country levels do we repeat same legal terms so as was pointed out i think that's the almost the guts and the foundation of a lot of the digital transformation that we're going through because that acts as an important foundation for incremental things on top of that and i i'm pleased with progress made as i mentioned a bit earlier now well over 50 of all of our accounts opened up in emir are on these digital rails now all of that said that doesn't stop further further progression in in the innovation space apis was mentioned we've almost had a an exponential growth of the use of apis within our franchise over the last 12 months or so and i see that continuing um that focus on digital advisory we've talked about connectivity with banks in that advisory space uh we're doing more and more digital advisory uh conversations with our clients talking about best practice talking about the embracing of many of these digital means and for city we we sort of celebrated a few months ago 10 years of our tts of our treasury and trade solution innovation lab that is very much working in partnership with our clients in partnership in some cases with fintechs to really solve some of those meaty client problems that are out there those meaty banking problems that are out there and using technology using innovation to sort of really leapfrog and improve the experience dramatically so i i'd absolutely agree with some of those themes and for us circular around that client experience how can we improve it uh we've seen a great uh increase in demand about improving the user interface and the customer experience so even before uh covered and the lockdown there's been a growing demand to consolidate information and the ability to execute decision on single interfaces despite that the information or the execution could have been actually concerning different different banks so there is a demand for a single practically aggregation portal to where to to include and from where to control a sort of corporate dashboard of liquidity cash management lending lending decision and so on now given the fact that with kovid we had remote working growing at becoming the absolute operating mode for a lot of treasury these days we had a shift logistical shift out of an office with an environment with high connectivity uh big screens multiple uh decks to multiple workstations and so on all located in close proximity within within the same environment to a very virtual space where screens are smaller there's less of them interaction is virtual uh potentially bandwidth could be a bit of an issue and and so on and all of this is taking us back to um a challenge that is mostly considered to be a retail challenge but in reality is very much something that the corporate industry have seen when there's been the first wave of tablets being rolled out to being adopted globally and uh the expectation of corporate treasurers and uh employees of corporates have shifted from being dependent on a desk a desktop to a question of why can't i access my liquidity position or authorize a payment out of my tablet when i'm out of the office now this question is not just coming back but it's coming back with a vengeance because ultimately it is what we can do over a limited interface in terms of access to data uh verifying ourselves authorizing a signature and so on that is enabling treasury to work on so in in the tacticality of some of these building blocks we are back to the basic uh question around how interfaces are interacting providing an interaction with users and now these are exchanging information within the organizational challenge of a distributed environment that is now very virtual eric i was going to bring you in and really ask you about where you're seeing sort of the most innovation and i was going to tackle another question which is in like in retail you've seen a lot of fintechs coming in and and things you know is this happening in the transaction banking space as well what i actually want to talk about to address your question is when we solve innovation don't forget about banks it's not just fintech banks it's actually providing a service to a client so the result of that we actually see summer innovation around the product side as well so someone really famous once said never waste a good prices so when we're looking at the product innovation is usually coming to three actually the most emerging thing that we've seen first of all is there's lots of talks around supply chain strategy network is changing that that's definitely means that the bank's supply chain finance will change to cater to this trend as well so in coupled with the accounting the regulatory that the sort of pressure we've seen industry we definitely think that the banks the banking community their view towards supply chain finance the product is changing as well so i'm not going to be surprised to see that these products probably gonna have a slightly different form in the next years or so when we actually have this pandemic behind us the second area we've seen is everybody has anticipated interest rate is going to stay low for a very very long time that always means that your liquidity product structure will change as well otherwise your product is not going to be fit for purpose anymore so the results of that we see some inheritance around the liquidity products as well which is again which was not very widely observed before the pandemic and thirdly i think is how actually we put the money where where we actually talk about is esg i think there has been so much talks about esg in the past many many years i think this is the first time we actually seen lotto banks we are talking about the tier one banks the world's biggest banks is actually actually do something about it we see a lot of banks putting esg score as part of the criteria the offering product their client we see many many banks actually offering some sort of green initiative links products in in in typing i think that's as to summarize i think this pandemic does put a lot of emphasize and urgency for the digital sort of innovation but at the same time i think this pandemic will bring a lot of sparkling new idea coming out of the product services side as well the environmental social governance topic is so hot at the moment and i think there's some been some especially during through this crisis the social aspect of it is really gaining a lot of uh yeah a lot of attention ronan where are y u seeing sort of innovation one angle that we're seeing is the role of customer-led innovation across all the products across payments uh liquidity trade finance supply chain finance mark talked a little bit about what the city innovation lab is doing we're seeing many uh institutions becoming much more focused in terms of how they identify specific pain points for individual customers which are very different sector by sector and even customer by customer to understand both in their corporate treasuries but but also in their broader businesses right how they how they grow their business how they manage their supply chain um how they how they manage their procurement to how transaction banks can help them solve those problems and i think some of the richest innovation stories that we saw coming through the transaction banking awards this year was around very specific industry-specific customer innovation whether it's about the deployment of uh instant payments to enable faster uh insurance claim settlement in the insurance industry whether it's about um the use of embedded payments within uh autonomous vehicles uh in the automotive industry there are many examples and i think that's where we're seeing some of the richest innovation happening and where that innovation is driving the greatest impact if i could just to expand on that point because it's a great point and if you think about that it's impacting the client's client so how can you make that experience so much better so the the insurance dispersion you are in turn helping that insurance company improve the experience for their clients at the end of the day so i i think that client experience goes one level deeper because that's the true differentiator for uh for many of the banking clients i think we are absolutely seeing more collaboration with fintechs i think the in the early early days of of digital disruption fintechs were seen of foes uh and and potential um challenges to the banks i think we've now entered a much more mature collaboration model with fintechs um and for many reasons both access to customers access to funding and sheer scale fintechs are finding it a much more productive model to collaborate with the banks and provide individual components of technology or product offering that enriches the bank's proposition we've seen a number of the banks take equity stakes in some of those fintechs to help um accelerate some of that growth and deepen the partnership um and as banks move to a much more modular product and technology architecture that is as we said earlier api enabled the ability to plug into an individual best of breed fintech is much easier it's also much easier to plug out from them and and when a newer more innovative fintech comes along in a few years time to partner with the best in the market so i think it leads to a much richer innovation environment and hopefully much better outcomes for customers as well we have two particular drivers for an increased activity from the fintech side within the um transaction banking space so first of all initially if we look at historically where fintech ended up focusing their activity there was a lot of focus on the retail side of business now that is not disappearing completely but the shifting so we see way more um investment in both in terms of capital as well as uh initiatives in into the corporate banking space transaction banking into direct tech business that it is an enabler ultimately two big parts of the operations of transaction banking uh an issue type first of all so that there's more supply on one side on the demand side on the on the banking side we are way ahead on a learning curve because as initially banks were looking at fintechs as a potential new entrance attackers enemies and so on we are a few years down the line where we have learned how to collaborate with them so there is way more familiarity with ways of interaction with the innovation ecosystem uh in the way of leveraging academic investments price competitions uh and so on how to to involve and integrate with other stakeholders within the innovation ecosystem and the two factors that join together are going to to let us think that we are going to see not just more activity and more interaction coming up from the fintech side but also that is going to be more meaningful in terms of bringing benefit to the industry and to clients alike great thank you so much for your insights again and now we're going to celebrate the pioneers in transaction planning from across the globe um and regions and the winner for africa is crown agents bank over the past year crown agents bank has stepped up its game and its digital transformation is beginning to reap rewards part of this transformation is its acquisition of fintech segovia's enterprise business and payment gateway product it also rolled out its mass payment solution to make high volume payments into the emerging markets easier faster and cheaper finally it launched a mobile app for its automated currency trading platform mpower fx hi i'm albert melissa i'm the group ceo of cronington's bank we're delighted to uh to be awarded the banker magazine transaction banking award for africa and really on behalf of all of our staff at uh at both carnivals bank and our sister technology company scuba technology inc um i think it's a real testament to the real transformation digital transformation that's taken place in organization and it continues to take place we've been pioneering as an aggregator of payment and fx flows into into frontier developing markets around the world but particularly in africa obviously having an important impact and we're thrilled to be recognized for that and it's really a direct result of doing business digitally effectively safely and working with clients to help them achieve better outcomes so thank you for the recognition on behalf of all of our staff and we look forward to continuing our our rapid progress for the asia-pacific region the winner is dbs dbs goes from strength to strength building on its digital strategy and baking in sustainability initiatives in the past year it launched 66 new apis for cash and trade services including a suite of new fx apis for singapore hong kong and china it helped its customers to integrate instant payments directly into their business processes it made cross-border ach payments available through dbs ideal and it rolled out the qr payment collection solution dbs max for merchants for the central and eastern european region the winner is btb bank btb bank has significantly strengthens its offerings to corporates over the past 12 months in cash management payments and trade finance it has enhanced its host to host connectivity to provide for the direct exchange of documents between the bank and any erp system including single sign-on and settlement in rubles and other currencies the bank has focused its innovation efforts on the moscow public transport system rolling out contactless payments and virtual travel tickets and trialing biometric payments the latin american region winner is bbva bbva's digital transformation is paying off for its corporate clients it has launched new functionalities in its global e-banking solution such as real-time global position for bbva accounts payment traceability and mobile app it's also leveraging apis for example bbva mexico launched apis to offer online 24 7 services for payments account inquiries and cash withdrawals without card as well as an api market overall the bank is supporting green initiatives across the continent acting as a pioneer in offering sustainable transactional products for the middle east region the winner is samba financial group financial group is another regional player that has ramped up its transaction banking offering over the past 12 months it has rolled out multi-currency collections in virtual accounts as well as cashless travel payments in saudi arabia and uae in trade finance it launched a new innovative sharia compliant islamic trade solution called without recourse sharer compliant discounting under export letters of credit for the western europe region the winner is hsbc in late 2019 hsbc launched its api developer portal followed by treasury apis now live in 13 markets in europe these apis are technology agnostic easily integrated into tms and erps and facilitate efficient cash flow management as well as improving payment tracking and reconciliation hsbc has launched its cash flow forecasting module using artificial intelligence to leverage data from its liquidity management portal i am luno matus i am the ceo of hsbc in europe i'm really proud to win the bankers award for best transaction bank in western europe this year our clients want digital tools that are fast simple and secure they want real-time visibility and control over their cash flow and they want access to their data on demand our innovation in areas such as apis and blockchain meets these needs by enabling clients to transform themselves so they can better serve their customers and manage their supply chains we will continue to develop our proposition to serve european clients connecting them internationally and to serve clients from outside europe who do business in the region thank you to the banker for this recognition i am very delighted to accept this award on behalf of my talent colleagues across hsbc and thank you to our customers for making this achievement possible and the moment you've all been waiting for the overall global winner who also picked up the award for north america the winner is city city has really stood out this year as a global leader cementing his position well ahead of the pack in north america in the u.s it launched an identity and account verification solution city verify to respond to cyber security and fraud concerns and digital payments it also rolled out city direct be cash concentration giving clients ability to manage their cash concentration needs online very timely under covid19 conditions the bank revamped at citibank online investments for money market funds partnering with fintech cash matrix to redesign the user experience a big congratulations to you mark and the whole city tts team for scooping the overall global award as well as north america as we're coming to the end of the webinar i just have a few more questions for my esteemed panel so my first question is do you think that the regional players who are building out their transaction banking capabilities will really be able to challenge the global players why or why not eric i was going to address this to you first i don't want to put out a blank case name and say which side is winning but i do think that the pandemic created a very unique opportunity for bank to rethink their strategy around the transaction banking business and there's a lot of region regional and markets difference as well so i don't want to bench out too far even when you're just looking at europe when we're looking at the regional banks in the scandi market they provided most of their support majority of the support to their customer in the market where the global players is actually being fairly rooted in the scanning market then you go to france italy germany where we still see the regional players the massive players play provide slightly more support than the global players then you go to netherlands switzerland island we actually see global players are us supportive as their regional players lastly when we come to the market we are in the uk market we see the domestic players actually providing more support to their clients during the pandemic which means that we do see a very dynamic occasion nowadays i don't i i don't want to generalize say which side is winning but i think that pandemic does provide a very good opportunity to for every single bank to rethink their strategy whether they want to take up the challenge with all the global players or they're just gonna quiet down in the aft after the pandemic where the world will be different and mark you know from your perspective as a global player um you know do you think that the regional banks are starting to become more competitive on that level thank you joy look uh let me express my my thanks and gratitude for for the awards i think i know we're we're incredibly proud but at the same time uh very much pertinent to the question that you're asking in all transaction services business so the city you can't be complacent and i think as we've talked about over the course of this uh this great uh conversation this great dialogue is around the innovation how quickly it moves um you know how you can ensure the best practice is out there with your client base so certainly when i think about uh across our entire network i think markets move at different paces if we just use a a simple analogy of the local adoption by regulators of instant payments for instance they're quite staggered and sort of stretch out broadly over the next couple of years in the market that we operate in at least so there is an element of right best practice how you can how you can do that how you can act as a global bank and recommend some of those best practices even to some of the the regulators as they think about rolling it out so but for me um uh certainly i'd like to think that we have an advantage being a global player consistency experience uh but at the same time very much as part of that model is making sure that you have the local knowledge you have that local market knowledge uh that's where maybe some regional players some local players maybe have an advantage to a degree but as a global bank making sure that you you are very attuned with the marketplace you are very aware uh with what's going on in terms of regulations you are very aware of the industry themes and actions that are taking place so you can leverage that to the advantage of the global companies that we ultimately service as well so uh competition is clearly good and and certainly from our perspective um we we very much work i would say in tandem with many of those regional players but for us delivering that country focus and that regional focus to the client so we fill it though enables us to to keep us at our best and ensure that we're never complacent in sort of pushing the boundaries and delivering more and francesco um again do you see that there's more competition from the regional players and then i also wanted to sort of take it to the next step which is really about you know do you think that there is a need to really rethink the global transaction banking model first of all if we look at the submissions that we had in this round of awards in my view one of the the messages one of the fact that working hypothesis depending on how you want to look at it was starting coming up that has been more evident of over over the years is somehow a polarization between organizations that are carrying forward and implementing leading-edge innovation and organization instead that are implementing tried and tested solutions that others might have gone through the implementation cycle a couple of years ahead but that are still adding significant value to client so in here if we have to look at the ability to innovate there is no doubt that the scale and reach and the technology and investment capabilities of the very large big global players are providing them an advantage in terms of being able to to innovate on the original side instead uh all depends on how we look at them because right now in particular whenever you have a liquidity you've got a shift to low interest type of environment and so on higher increased risk the closeness to the market the ability to interact and to talk with customers much more closer to to be part of the fabric in which those customers are operating is providing a significant competitive advantage ultimately if we had to take a very practical example uh we are in a situation where the overall industry as the merchant acquiring dilemma uh if on the merchant acquirer all of a sudden even merchants that have no merchant creditors capital now uh expose an exposure profile and so how do i manage that i had to become very close to them because adding visibility out of the credit scoring out of the the the corporate infor ation is not good enough because their liquidity positions are varying dynamically on a day by day week by week basis and the only way you can gain that type of insight is by having a very good relationship manager that is very close to the operations of the environment and then you have a very fine decision to to take in covering up for your risk or ending up absorbing too much liquidity and potentially being the the cause for a company to to triple over so uh closeness to the market is absolutely important and this is where original players have an advantage in picking up a theme that that has been mentioned by uh one of my esteemed families colleague here is uh the ability to understand the business of your customer so in order to improve um the customer's customer experience within the insurance business you need to understand the business the same goes for helping an organization selling specific type of consumer goods online and and so on so what i would expect to see in the future is the rise of specialization as a value to customers and as a value to corporate and as we are in an environment where interest-based revenues disappear and we will have to rely much more on fee based revenue the ability to provide those type of services to contextualize them and to make sure that delivering value for the customer ultimately is not just providing a line of revenue but also helping a transaction bank to the risk business by helping his customer to be successful in a market that is very very different compared to what we had before that's very interesting ronan i don't know if you want to come in on this and i'm wondering so there's the whole idea of maybe rethinking transaction banking but you know also what do you think transaction banking is going to look like in future do we think there is a need for a rethink of the transaction banking business model absolutely to some extent we're part way through that journey and a lot of the innovation that we've we've talked about today uh is testament to that but in in the backdrop of the macroeconomic environment um the pace of disruption that we're seeing in the market a few themes come out firstly there's a big question on the commercial model for transaction banking in a low interest rate environment how do you identify sufficient fee income to restore the growth prospects of the business and particularly as there is increased competition and we've seen fee margin compression what are the new products and services whether that's charging for apis charging for channels charging for banking as a service like business models that can change the commercial model and move away from you know a traditional model that was based on cross subsidies between products into one that is much more viable uh in the long term i'd say the second question is around how to adapt to innovation at scale innovation being a constant not not simply a periodic um pressure we've talked about customer-led innovation um the rapid pace of new market infrastructure coming out in terms of instant payments and digital currencies and so on how banks adapt to that and make that part of their ongoing business will be critical and then finally in terms of the the transaction banking business model we see a huge opportunity to break down some of the barriers between the wholesale and retail businesses and we're already seeing some of that come through in terms of new opportunities to collaborate between uh corporate businesses merchant acquiring and even retail businesses to create new innovative propositions but also to try and increase the valuation multiple of the business by exposing more of that value to the external market and we're seeing some of the leading players starting to do that already uh eric you know what is the future of transaction banking i think the future is infinite everybody know that we won't know what's going to happen but from my perspective i think the market is still way too fragmented it has a way too many different standards even if you think about swift as one of the biggest uh standard uh body in the industry it does not capture 100 what's going on in industry so what i think in the long run the industry will emerge as a dual assistance sort of model which means that there will be a traditional banking system plus another emerging sort of blockchain any sort of blockchain related system and within the traditional banking system you're probably going to have a chinese system versus the rest of the world system this is where i think that the industry will evolve in the long run because the current very fragmented very sort of different standard driven social market is going to prove in very inefficient for the long run or very big industry excellent and mark i'm going to give you the last word i think to summarize all of the the panelists uh the future is very exciting um that change is continuing as i uh i think i quoted earlier um one of the the ceos of a big technology firm saying that digital adoption in two months you had sort of two years worth of digital adoption my hope is that momentum continues uh and again we've got an exciting future ahead of us for the transaction services business further innovation servicing those clients ensuring that their clients clients are more satisfied with them that's going to continue to be the differentiator there so an exciting future ahead and i'm delighted to be part of it well i'd just like to say thank you so much to my panelists mark ronan eric and francesco for participating and for all your interesting insights and a big congratulations to all the winners of the bankers transaction banking awards 2020. thank you so much for listening