Multibank Relationship Management in Middle East and Africa

7 Multibank Relationship Management in Middle East and Africa Operating model Corporates whose clients are banks themselves may agree to the condition that the bank will only settle to accounts held with them for their business arrangement to commence/continue. Leading to a situation where this type of corporate maintains multiple banking relationships as the cost of doing business. Non-Governmental Organisations (NGOs) and other project-focused corporates may wish to split projects by accounts or even by banks. Local market penetration In efforts to penetrate newmarkets within the MEA region, MNCs might establish relationships with local banks to gain additional market insights, broaden network connectivity and establish credibility. While not essential, this can facilitate smoother entry and accelerate sales. Many corporates venturing into newmarkets set up foreign entities as cost-plus operations. While they might hire Research and Development (R&D) engineers or set up a small sales office to explore new prospects, the entity is not expected to generate revenue in the near term. WhenMNCs adopt a cost-plus approach, they often find it difficult to get a regional bank to provide accounts due to limited transaction volumes and balances. Consequently, many end up working with local banks, establishing an account that is used mostly for payroll and is typically funded by head office once every three months. Financial considerations for global growth 01 04 05 06 02 03 Market analysis and financial insights Select strategic business collaborators Centralisation vs decentralisation Technology standardisation Resource allocation Long-term flexibility Understand growth projections, competition and currency dynamics. Implement common platforms for efficient connectivity with banks and other counterparties. Budget for on-ground management of counterparties for effective communcation and strategy execution. Develop adaptable strategies for sustained success in changing markets. Choose reliable legal and financial institutions for efficient operations across markets. Evaluate liquidity and cash management strategies, considering operational frameworks and subsidiary integration. Source: Citi