Americas Derivatives Awards 2019: Société Générale brings tailored approach to US market

Taking a bespoke, advisory approach, at the same time as offering innovative solutions to its clients continues to prove a winning formula for Société Générale, all of which helped the bank mount a successful defence of its title of Americas Corporate Solutions House of the Year.

  • By GlobalCapital
  • 17 Jun 2019
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Taking a bespoke approach means not being constrained in the solutions it can offer. For SG, the aim is to deliver world-class expertise tailored to clients’ specific needs and the local market environments in which they operate. To do this, SG works to gain a deep understanding of the challenges and problems its clients face. SG believes that doing this to good effect calls for both targeted and highly sophisticated innovation.

“We always want to explore the wide range of products that are available to our clients,” says Anna Faustini, managing director and head of FX sales and corporate rates at SG. “Of course, we can handle the vanilla transactions, but when our clients are willing to look at different scenarios, like using option strategies, or something else very tailored that uses our product as well, that's where Société Générale really excels.”

Sales and relationship management teams are regionally focused while advisory teams specialise in industry sectors for the corporate clients they serve. Then there are SG’s quantitative specialists to add to the mix, the product engineers that are based in Paris.

The approach the bank takes to each client is geared towards the unique challenges and opportunities they face. How SG services a client in the consumer goods sector is therefore quite different to the approach it takes to one in the automotive sector. SG sees companies in different sectors as facing differing balance sheet issues, including around capex and cashflow, as well as having distinct overall risk profiles.

“We offer substantial in-house expertise, from our market risk advisory specialists to our engineers, to our very seasoned salespeople that have been in the market for a long time, have worked with a variety of clients and understand the product as well as the market dynamics,” says Faustini.

SG has this year focused on making a name for itself in producing flexible Credit Support Annexes (CSAs), the legal documents that regulate collateral exchange for derivatives transactions. SG points to the growing focus from corporates on their credit exposure to banks, a trend that has been a feature of the past decade.

While companies have specific frameworks and policies in place to manage this exposure, they have tended to do so by dealing with banks that have an appropriate credit rating. They have also attempted to spread their business across relationship banks, so as to achieve some diversification.

SG has been banging the drum for corporations to use CSAs, specifically tailoring them to each company’s unique needs and profile. SG claims optimal CSA arrangement can reduce counterparty risk exposure significantly, with consideration being made to firms’ individual characteristics.

SG also takes a dedicated approach to educating clients on the evolving regulatory landscape, formulating a mix of derivatives solutions to meet those challenges and helping clients to make the most appropriate decisions according to the macroeconomic environment.

“We take a very advisory approach with our clients and really work hard in understanding what they need,” says Faustini.

“We aim to ensure our clients’ footprint matches up against our footprint. So, we selectively look at our prospect list, which we expect will continue to grow over the years to come. We remain well positioned because we’re very close to our clients. Given our risk advisory approach, we should continue to see good flows.”

In the US market at least, SG is still a bank with a smaller presence, though it continues to punch above its weight and has been able to repeatedly win market share in the corporate client solutions segment.

  • By GlobalCapital
  • 17 Jun 2019

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1 JPMorgan 92.59 388 8.96%
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1 BNP Paribas 60.87 123 14.06%
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1 Goldman Sachs 2.07 11 10.42%
2 BofA Securities 1.40 6 7.01%
3 Citi 1.37 7 6.87%
4 Morgan Stanley 1.36 6 6.85%
5 JPMorgan 1.31 7 6.59%