The modern finance executive’s hands are full…

Today the custodians of finance are already time-poor, yet their role continues to increase in both breadth and depth.

 

The evolution of the finance executive’s role…

The financial function is no longer all about bean counting… Our clients also need to be strategists, IT specialists, compliance officers, corporate governors, risk and human resource managers.

 

It’s a difficult balancing act…

Even as they are faced with a role that is growing in scope, our clients have to contend with rapidly increasing regulatory oversight, corporate governance requirements, stakeholder accountability and risks of personal liability. It is therefore becoming even more important for them to pay attention to the detail.

Since they just don’t have the time to stay abreast of a fast-changing environment, they are being compelled to co-opt specialists to stay on top of the nuts and bolts.

 

Co-sourcing for excellence…

Clients must decide whether to create these specialist capabilities in-house, outsource them or co-source them (a combination of the previous two options).

We recommend the co-sourcing solution because

  • it is extremely cost effective;
  • it enables each client to focus on their core business by means of a more focused in-house team whilst simultaneously outsourcing any non-core functions;
  • it provides access to technical expertise that is high quality, contractually specified, scalable, cutting edge and not easily attainable;
  • it is an effective tool to manage capacity;
  • it is a potent way to manage risk; and
  • it enhances the capacity for innovation.

However, it is critical that the service provider is independent, has aligned interests and possesses the requisite specialised skills.

Is the term “banking independence” the world’s greatest oxymoron?

Over time investment banks have evolved from being ‘niche players’ to ‘financial juggernauts’. This transformation has heightened the potential for conflicts of interest.

The problem is especially acute within the Markets divisions of investment banks where securities are traded. The practices of erecting ‘Chinese Walls’, creating ‘private-side’ teams and transaction-based ‘wall-crossing’ can sometimes be ineffective mechanisms for managing these conflicts.

There are many examples which illustrate this point.

 

Classic principal/agent dilemma, a real test of banking independence…

While banks provide access to the markets in which they operate, their own proprietary participation may at times undermine their ability to act independently and in their clients’ best interests.

In addition, their informational advantage, specialist skills and tools, and transaction-based remuneration schemes provide them with both the opportunity and the incentive to retain value.

The simple solution to these challenges is to level the playing field by uncovering all the hidden value, ensuring its equitable distribution. Advize can help you ‘know the game’ better!

 

Tailoring your financial dreamcoat…

In most cases the optimal client solution comprises an integrated bundle of component parts from one or more investment banks, and/or from one or more of the divisions within these banks. However there are some challenges to achieving this. Perhaps the greatest impediment to the most efficient and cost effective result is the well-known ‘silo effect’, which exists on three different levels, namely:

  • Intra-industry;
  • Inter-divisional; and
  • Inter-personal.

Compensation structures are largely to blame for this. We help our clients to cut across these silos.

It takes two keys to unlock all the hidden value in M&A…

The ideal M&A/corporate restructuring approach requires the complete integration of both investment banking and global markets expertise from the inception of a transaction.

Although investment banks may be able to offer independent M&A/corporate restructuring advisory services to their clients, they are not able to provide independent global markets advisory services because they are selling the underlying products. A clear conflict exists. This problem can be overcome by retaining an independent global markets advisor to advise on the markets aspects of the transaction.

The addition of independent global markets advisors to the M&A/corporate restructuring process:

  • bridges the gap that currently exists between the M&A/corporate restructuring and global markets deal teams due to the mandatory Chinese Walls;
  • ensures that the correct expertise is available for the entire duration of the transaction to accurately establish pricing and funding appetite levels for different transactional structures;
  • minimises the risk of traders profiting from sensitive information if the Chinese Walls fail;
  • ensures that the deal team has access to real-time market specific information about the global markets products being used in the transaction;
  • facilitates the active management of the transaction execution; and
  • significantly reduces global markets transaction execution costs by eliminating  the informational asymmetries that currently exist between clients and the banks.

Advize… your very own superhero!

Advize is an independent global financial markets advisor focusing on the provision of strategic liability, financial risk management and general global markets advisory services.

Advize will

  • help you to identify your optimal capital and debt structure;
  • provide you with a comprehensive overview of all the available sources and types of debt finance to best suit your needs;
  • review, summarize and advise you about all proposals you receive from banking and other financial service providers;
  • provide objective pricing for any financial markets products and structures you are considering acquiring;
  • provide independent mark-to-market valuations for any existing exposures you may have;
  • provide financial risk management advice for your business;
  • advise on the accounting, legal and regulatory aspects of any transaction, structure or strategy;
  • interact with the relevant banking and capital markets suppliers, either together with you or directly on your behalf;
  • provide you with advice on global markets products issuance and execution strategies;
  • assist you to extract the maximum value out of all relevant banking and capital markets relationships; and
  • advise you on all the global markets aspects of any M&A/corporate restructuring activities, in conjunction with your M&A/corporate restructuring advisors.
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