Canadian Treasurer

December 20, 2010

Fifth Third seeks to expand in Canadian treasury management market

Cincinnati--Ohio-based Fifth Third Bancorp has had a commercial branch in Toronto for five years, serving U.S. corporations which do business in Canada as well as Canadian firms wanting to expand in the U.S. In 2011, the bank plans to expand the customer-serving staff at its Toronto office.

“Our focus with our Canadian branch is very targeted,” Jeff Ficke, Fifth Third’s director of Treasury Management, tells Canadian Treasurer. “We serve corporations which are doing business on both sides of the U.S.-Canadian border. The aim is to act as a single financial institution bringing both their U.S. and Canadian operations together. Our Canadian cash management service offerings complement what we offer in the U.S., but obviously differ slightly due to the fact that Canada is a different banking environment to the U.S.”

Fifth Third’s Canadian operation offers treasury management; global trade solutions; foreign exchange; global cash solutions; Internet banking; and commercial lending.

“The team at our Canadian operation is very closely linked in with our cash management teams in the U.S.,” Peter Mack, Fifth Third’s director of international banking, says. “Currently, there are four staff, who focus on the customer-facing side, with the back-office operations outsourced to a third-party. In 2011, the number of staff will double to eight.”

“We are able to support our clients internationally,” says Mr Mack. “For example, our card payments processing business Fifth Third Processing Solutions is a joint venture with private equity firm Advent, and one reason why we went with Advent is their international perspective and their ability to expand globally.”

Mr Mack says that Fifth Third feels there is a subset of corporate clients to whom the bank can provide a valuable set of cross-border services. “We aim to integrate their domestic and international business in a seamless way,” he says. “You don’t have to go to one of the top global banks to get this.”

When Fifth Third starts working with a new corporate client, its aim is firstly to understand what the customer is trying to accomplish, Mr Mack says. “We help the client gain visibility into information such as working capital, balance reporting, and transaction reporting that will mitigate their risks. We can also help them with Canadian and US tax structures and with Sarbanes-Oxley regulations.”

Mr Mack says that Fifth Third doesn’t just sit down with a client to analyse their balance statements, but that it also aims to provide consulting services. “We have built some models which provide clients with guidance on their working capital, for example to identify the key drivers are that can help them improve their collection efficiency and the distribution of their funds,” he says. “We see ourselves not so much as a vendor but as consultants to our clients.”

Fifth Third offers Canadian clients capital markets services, as well as trade finance facilities, Mr Mack says. “If a Canadian company wants to make an acquisition in the U.S., we can help arrange the capital markets funding,” he says. “Likewise, if they are exporting to the U.S., we can arrange the trade finance aspect of the deal with their U.S. clients.”




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