Announcing the 2015 Share and Quality Leaders

As Companies Streamline and Globalize, Mid-Sized Banks Feel the Squeeze

Large European companies are lowering costs and simplifying operations by consolidating trade finance business in the hands of large banks like BNP Paribas, Deutsche Bank and HSBC. At the same time, companies are tapping the expertise and established networks of local providers in markets like China and Brazil for trade finance related to their growing businesses in these countries. Caught in the middle are mid-tier European banks, whose trade finance franchises are feeling the squeeze.

The results of Greenwich Associates 2015 European Large Corporate Trade Finance Study show that companies are taking advantage of standardization in trade finance products and services and the spread of electronic initiation of trade finance transactions.  Electronic solutions automate and speed the process of obtaining and implementing trade finance products and services.

Electronic initiation goes hand-in-hand with market concentration—a phenomenon that is providing a boost to the top banks making up the list of 2015 Greenwich Leaders. In any given market, the biggest banks are best able to afford the investment required to maintain sophisticated IT platforms. These electronic capabilities give companies an incentive to route growing shares of their trade finance business to the biggest banks.

“We expect companies in Europe to allocate even larger shares of wallet to their lead banks as the products they use become increasingly commoditized and electronic initiation becomes more common,” says Greenwich Associates consultant Melanie Casalis.

European Companies Target Cross-Border Trade 

Large Western European companies do business in 3.6 geographic regions, compared with 2.8–2.9 for companies in North America and Asia, and 2.5 for Latin America. After Western Europe, Asia represents the most important foreign market, as shown by the share of Western European companies utilizing trade finance for transactions in the region.

“Large companies in Europe and in other regions would be well served to meet with domestic banks in regions like Asia that are offering aggressive pricing on trade finance as a means of forging relationships with companies and building their franchises,” says Greenwich Associates consultant Dr. Tobias Miarka.

2015 Greenwich Share and Quality Leaders
BNP Paribas leads this highly competitive space with a market penetration score of 36%, followed by Deutsche Bank at 32%, HSBC at 30%, UniCredit at 26%, and Commerzbank at 21%. These banks are the 2015 Greenwich Share Leaders in European Large Corporate Trade Finance. The 2015 Greenwich Quality Leader in this market is UniCredit.