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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Our Consultants Andrew Austin Bsc ACIB Andrew has over 10 years experience within relationship management for a major UK bank and eleven years experience of reviewing the banking, treasury, and cash management arrangements for a large number of companies, professional firms and public sector bodies. He also has extensive experience of running tenders for banking arrangements. Andrew is a founding Director of Focus on Banking. He is an Honours Graduate of Exeter University and an associate of the Chartered Institute of Bankers. His banking background was as a relationship manager with NatWest, where he was responsible for dealing with professional firms and companies in a range of sectors in the City. During his 10 years with NatWest, he also spent some time in the Treasury and Capital Markets businesses. Email Andrew Austin Peter Waite CertCM Peter worked for a major UK bank for over 11 years where he gained considerable experience managing corporate relationships with firms operating in a variety of industry sectors. He spent two years with the bank’s card division gaining a detailed knowledge of the plastic debit and credit card industry. Peter has worked for ten years as a consultant responsible for reviewing banking, treasury and cash management arrangements for a large number of companies, charities and public sector bodies. He has managed numerous tenders for both banking and credit/debit card acquiring arrangements. Peter has gained the ACT qualification in cash management and has written a number of articles on different aspects of cash management within the UK. Email Peter Waite James Larholt James has 40 years experience in treasury, 25 of them spent with a leading international bank. He worked for a hedge fund for 8 years, and then became an independent treasury consultant, advising companies on foreign exchange and interest rate risk management, and lecturing on treasury to bank training schools. He has also carried out projects for the Association of Corporate Treasurers. As sales director, James has brought his extensive contacts in both the private and public sectors to Focus on Banking, and has made a significant contribution to the expansion of the company’s client base. Email James Larholt	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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