Transaction services guide 2014: KrisEnergy – an evolving relationship
One of the key tenets of transaction banking is that by building a long-term relationship with clients – driven by day-to-day activities rather than flashy one-off transactions – banks can play a role in supporting the development and growth of clients.
Given that global and large regional banks primarily focus on top-tier corporates, this hypothesis can be difficult to test: it is unusual for a company to go from start-up to multinational without at least a few changes of transaction bank along the way.
One exception is KrisEnergy, an independent oil and gas company established in September 2009. To be sure, KrisEnergy was far from a regular start-up. On launch, it received a $500 million equity investment from First Reserve, a leading private equity investor specializing in the energy sector. Moreover, the founders of KrisEnergy previously founded and operated Pearl Energy, a multi-asset exploration and production company sold to Mubadala Development Company, an Abu Dhabi government-owned investment vehicle, in 2008.
Nevertheless, KrisEnergy has enjoyed spectacular growth, driven by a series of strategic partnerships with leading operators, giving it interests in 14 exploration, development and production assets in Cambodia, Thailand, Indonesia and Vietnam after just three years of operation. Flexible banking arrangements were therefore necessary to meet the company’s evolving needs.
“Starting from basic operating accounts with [an] electronic platform, the cash management solutions that we used extended to liquidity management solutions that helped us enhance value on a day-to-day basis and cater for an event-driven transaction,” explains Stephen Clifford, chief strategy officer and vice-president, treasury, at KrisEnergy.
As KrisEnergy’s reach across southeast Asia expanded, it required an efficient and effective straight-through processing platform to manage domestic and cross-border payments. RBS, which has worked with KrisEnergy since its inception and is now its lead bank in five countries in Asia and Europe, proposed its Access Direct host-to-host solution.
|Manfred Schmoelz, RBS
“We needed a host-to-host global payments engine to facilitate domestic and cross-border commercial payment instructions, in all currencies, from any location in the world,” says Clifford. “And for ease of use, we wanted to be able to send payments in a single file and view everything from a single window. With Access Direct, we got what we needed in a highly secure environment as well as seamless and comprehensive reporting.”
Benefits for KrisEnergy include automated, multi-bank reporting, and real-time tracking and tracing files and individual transactions, assured straight-through processing that eliminates the need to re-key transactions in a bank interface, and online signing which offers the convenience of online authorization. Access Direct uses industry XML standards for communication and payment formats, supporting seamless integration with ERP and treasury systems.
“Our choice of Access Direct marks the latest stage in the continuing evolution of our partnership with RBS,” says Clifford. “RBS has been with us from day one and we’re confident that its capabilities will help us to continue to grow and achieve our strategic goals in the future.”
According to Manfred Schmoelz, head of transaction services, Asia Pacific, at RBS, the key to relationship banking is thinking about where you can make an impact for your client. “In the case of KrisEnergy, our relationship evolved as the company went from a start-up to an international corporate,” he notes. “Over the years, we helped the company improve efficiencies in its financial processes and constantly considered what they might need next as their business grew.”