Focus On Banking

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Banks Increase Pricing For Credit

The 'credit crunch' and changes in capital adequacy requirements have seen banks attempt to increase their income from lines of credit extended across our entire client base. We are seeing increases in both fees and margins for short term working capital lines and a tendancy to restrict the use of overdrafts in favour of LIBOR linked facilities.

The fees and margins for term debt have also increased. Our experience is, however, that it remains a competitive market place and banks do want to lend to good quality covenants. Whilst working with clients, we have been able to mitigate some of the increased costs and if your bank is attempting to increase its income from lines of credit then it is probably a good time to review the whole relationship to ensure that in overall terms pricing and charges remain competitive.

Reducing costs in the Charity sector

The economic downturn has hit the charity sector with most UK charities expecting donation income to fall over the next 12 months.

This prospect is driving charities to look harder for ways to reduce costs and improve efficiency. Focus on Banking has now worked with 10 major UK charities in the last 18 months and has been able to generate savings in banking and credit/debit card acquiring arrangements of well over £500,000.

Joint Procurement for Local Authorities

The profile of procurement in local authorities has been raised in the last few years through a number of Government publications and reviews. All local authorities are now considering options for procuring good/services on a joint basis with neighbouring authorities.

Whilst undoubtedly for certain types of contracts, authorities will benefit from economies of scale, this does not necessarily apply to banking. In fact banks have tended to show little appetite for complicated joint contracts and will not usually offer discounts or reduced pricing when several authorities collaborate.

Law Firms Become Critical Customers For Banks

The credit crunch has seen the competition between banks for the client balances that law firms hold increase. At the same time, firms have increasingly become concerned about the safety of the balances. Given that banks are also restricting the use of Base Rate linked facilities and increasing margins and fees for credit lines, the dynamics of firms’ bank relationships are fundamentally changing.

Maintaining and increasing client balances held has become a key target for banks and there has never been a better time to review relationships.

We have now worked with more than 65 of the UK’s largest professional firms and the number continues to grow.

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About Focus on Banking Focus On Banking was established in 2000 by a team of former senior bankers with many years of experience advising and working with companies, professional firms and public sector organisations. We only specialise in advising clients on their UK banking, credit and debit card acquiring and cash management arrangements. The advice we provide is totally impartial as we are entirely independent of banks and other bodies/organisations. The organisations our consultants have advised include: Companies of all sizes including blue chip corporates Professional firms (including 'Magic Circle' and international law firms) Government departments and agencies Local Authorities Housing Associations Universities Major UK Charities Our experience and expertise as both relationship managers for major UK banks and consultants puts us in a unique position to maximise benefits for clients without damaging important bank relationships. All our work is bespoke to individual client needs and is underpinned by the need to generate significant savings and/or provide value for money. If the aim of a project is to identify and deliver savings in banking and/or card acquiring costs, we always ensure that we can generate savings well in excess of our fee before undertaking the work. Our confidence in our ability to generate lower costs is demonstrated by our willingness for our fee to be based on a percentage of annual savings achieved.	News Banks Increase Pricing For Credit The 'credit crunch' and changes in capital adequacy requirements have seen banks attempt to increase their income from lines of credit extended across our entire client base. We are seeing increases in both fees and margins for short term working capital lines and a tendancy to restrict the use of overdrafts in favour of LIBOR linked facilities. The fees and margins for term debt have also increased. Our experience is, however, that it remains a competitive market place and banks do want to lend to good quality covenants. Whilst working with clients, we have been able to mitigate some of the increased costs and if your bank is attempting to increase its income from lines of credit then it is probably a good time to review the whole relationship to ensure that in overall terms pricing and charges remain competitive. Reducing costs in the Charity sector The economic downturn has hit the charity sector with most UK charities expecting donation income to fall over the next 12 months. This prospect is driving charities to look harder for ways to reduce costs and improve efficiency. Focus on Banking has now worked with 10 major UK charities in the last 18 months and has been able to generate savings in banking and credit/debit card acquiring arrangements of well over £500,000. Joint Procurement for Local Authorities The profile of procurement in local authorities has been raised in the last few years through a number of Government publications and reviews. All local authorities are now considering options for procuring good/services on a joint basis with neighbouring authorities. Whilst undoubtedly for certain types of contracts, authorities will benefit from economies of scale, this does not necessarily apply to banking. In fact banks have tended to show little appetite for complicated joint contracts and will not usually offer discounts or reduced pricing when several authorities collaborate. Law Firms Become Critical Customers For Banks The credit crunch has seen the competition between banks for the client balances that law firms hold increase. At the same time, firms have increasingly become concerned about the safety of the balances. Given that banks are also restricting the use of Base Rate linked facilities and increasing margins and fees for credit lines, the dynamics of firms’ bank relationships are fundamentally changing. Maintaining and increasing client balances held has become a key target for banks and there has never been a better time to review relationships. We have now worked with more than 65 of the UK’s largest professional firms and the number continues to grow. Contact Us Email Us
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