Analyzing international bank fee statements requires in-depth knowledge of international banking structures, accessibility and visibility into local bank fees, and copious amounts of time and resources. Many treasurers do not make it past the first step of obtaining their international bank fee statements in useable formats to then progress to understanding their fees across multiple countries.
Obtaining Bank Fee Statements
For any treasurer in the US, obtaining an account analysis statement is a fairly straightforward and effortless process. Yet, what can be found with the click of a button domestically might turn into a wild goose chase outside the US. If your organization is highly decentralized, you will spend a tremendous amount of time and energy identifying the people within your organization that are responsible for bank fees. Then you will spend more time having those people chase after their local banks to identify who within the banks are responsible for billing. Only after all those steps can you finally send out a request that most likely will end up unanswered. If you have ever been through this process, you probably noticed that most of the international banks are just not accustomed to providing any sort of bank fee statement, which is why requests can remain unanswered.
In our experience, there are three distinct groups of banks. American banks with an international presence will try to accommodate the American treasurer’s expectation of obtaining an account analysis statement. Non-American banks with a global footprint are usually servicing large multinationals that are advocating for a global bank fee billing standard such as camt.086 or TWIST BSB. Consequently, they would at least understand your need and most of the time provide some sort of bank fee statement. The most challenging part of the job is to deal with the indigenous banks with no international presence. They are the most difficult because they may not have a dedicated person to ask, or may not even understand what is being requested.
Beware that regardless of the size or the international footprint of the bank, the common caveats among all of them is the inability to produce historical data, meaning that the banks may only begin recording bank fees once a client makes the request.
Understanding Bank Fee Statements
If you have overcome the first and most dreadful challenge of accessibility, this next step comes with good news and bad news. The good news is the succinctness of international bank fee statements. Unlike your typical domestic account analysis statement, where the ease of accessibility is completely counter-balanced by the need to decipher hundreds of obscure line items, international bank fee statements are usually short and self-explanatory. Most of them will contain less than a dozen very straightforward line items. For example, wire transfers would be just one line in your statement, whereas in the US, the banks would typically breakdown the service into dozens of line items.
The bad news is the ability to compare and benchmark your fees can be strenuous. Depending on the scope of your international presence, you might be looking at dozens of different countries, at very different stages of cash management maturity and banking capabilities. All of them will have local means of payment, regional market standards, and sometimes very constraining government regulations. Companies will need to be experts on each country’s local banking structure and payment nuances while keeping a focus on the global picture. Our teams often refer to this as the need to be ‘glo-cal’ (global and local). Even if you rely on local expertise within your organization, you may lack the market knowledge that would allow you to compare your fees and services, and challenge your banks.
It is easy to see why and how this process can be extremely frustrating and a drain on time and resources. Some advisory firms may have an understanding of US bank billing structures while others may have an understanding of one or two regions internationally. Since Redbridge has teams across the globe to service all five continents, we are able to combine our knowledge-base and offer a global perspective with an incredibly deep local expertise. We focus on giving clients transparency into their current fee structure, a better understanding of their fee components, unbiased advice on how they compare to the market in each country, and suggestions for potential improvements.
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