Management
4.10 The Corporate Banker's Competencies and Tools
Table 4.12 shows the skills and attitudes considered relevant by Italian banks for the definition of the corporate banker's role. The answers pro- vided by the other European banks show large correspondence with those of Italian banks.
Table 4.12. Corporate bankers' skills and attitudes
1) Professional background:
- market analysis and valuation - business sectors understanding - credit products/financial advisory - fiscal matters
- legal matters
- corporate management (strategy, p&c, promotion, etc.) - bank internal procedures
- customer needs analysis and sales techniques - budgeting
- branch/customer action planning - credit risk valuation
- managed saving
- security investment services - structured finance and derivatives - payment systems
Prevailing answers*
M M M-H
L L M M H H M M L L M M 2) Skills and attitudes:
- relationship management H - organization M-H - planning and control (budgeting) M - leadership H - problem solving H - integration and negotiation M-H - commercial boost and vitality H - stress management M - collaborators' leadership and development M - performance orientation M - communication and impact M
* Importance H=High, M=Medium, L=Low
The role tends to be characterized under the commercial profile, but some attention is also paid to credit risk valuation capabilities. Under the first profile, customer's needs analysis and budgeting are the most impor- tant competencies whereas relationship, negotiation, commercial boost, leadership and problem solving are the most important skills and attitudes.
The lower relevance of fiscal and legal profiles arouses some perplexity.
In this field, in fact, advisory activity can be developed both in relation to bank product and services and to the multiple needs that may be expressed by corporate clients (e.g. assistance for drawing contracts with foreign counterparts, verification of guarantee reliability, etc.) and enormous in- formation synergies may be produced for credit risk valuation. Various banks have stressed the need to avoid competition with legal and account- ing firms.
The medium relevance attributed to professional background as to cor- porate management (strategy, planning & control, marketing, etc.) is im- portant for the consolidation of customer relationships and the creation of the image of a "house-bank".
The corporate banker's role and the implementation of internal rating systems imply strong needs for innovative information systems. Though believing one of the fundamental features of such systems must be their in- tegrated design on the basis of the selected configuration of the corporate banker's role in every single bank, we shall analyze here below the most important general needs resulting from the commercial, credit risk man- agement and managerial profiles of the "average" corporate banker that has emerged from this research.
As for commercial profiles, there seems to be the need to integrate into a sole tool the supporting systems for customer needs identification, bank products and services presentation, and the development of advisory activ- ity. This tool should allow corporate managers to:
1. interact with clients by "surfing", if necessary, among advisory services and products provided with fully updated information;
2. develop advanced advisory by analysis and simulation applications;
3. regularly enhance their competencies by using the tool as a distance or assisted learning instrument;
4. receive communications and file them automatically in a daily-used tool;
5. collect and store customer relevant information by means of customer relationship management instruments, which are deeper and more flexi-
ble than those typically used in contexts of less customized relations (re- tail banking) or less complex relations (private banking).
As for the profiles regarding credit risk, the corporate banker's needs are apparently conditioned by the type of involvement in credit management which characterizes the role in the various banks. As information synergy between commercial activities and credit risk valuation is nevertheless considered crucially important, it is evident the corporate banker should be provided with all the analyses carried out by credit structures. If such analyses are prevailingly mechanical, the corporate banker will clearly have to interpret available information in pro-active terms and require in- formation supports that are typical of the corporate analyst.
As for managerial profiles, there is the need to develop budgeting and measurement systems of individual managers' portfolio performances, by identifying key performance indicators and suitable benchmarks. In other words, the corporate banker should have his own Tableau de Bord for the management of his portfolio and this should be a component integrated with the management systems from other coordination roles (team-leader, corporate branch manager, area managers, corporate division director). A distinctive feature of the corporate banker is the remarkable amount of ac- tivity developed on the client, outside the bank premises. There are impor- tant communication needs with typical interlocutors (first of all the corpo- rate banker's assistant, the manager of the branch where services are provided, product specialists, higher-ups, other clients), important storage needs for the exchanged information and the decisions taken. Other im- portant information supports regard time management and activity opti- mization.
Our survey has highlighted important training needs, which can be gath- ered by commercial, risk valuation and management profiles. More spe- cifically, Table 4.12 can be used for further specifications regarding train- ing requirements.
We would like to point out only two aspects.
First of all, banks where the credit risk analysis process is essentially mechanic should try and avoid the gradual deterioration of corporate bank- ers' corporate analysis skills. In this case, training might make up for the reduced incentives resulting from the use of automated models of rating assignment.
The second aspect regards training tools. If traditional training schemes can rely on the above mentioned information tools, which are concurrently operating and learning tools, the value added of training processes can be significantly enhanced.