Problem

A U.S. regional bank had a European fixed-income rates product business that was languishing. After watching the franchise tread water near the bottom of the pack for several years, senior management had lost patience. It was time to jump-start growth or pull the plug.

Solution

The bank engaged Coalition Greenwich to assess the viability of the franchise and determine the potential for growth if the bank invested to revitalize the business. To determine exactly where the franchise stood and why, the Coalition Greenwich team:
 

• Tapped into its set of comprehensive revenue data provided by European rates dealers to determine the franchise’s market share, both across the region and in individual countries, and its wallet share from specific clients.
• It then accessed proprietary data showing the quality ratings given to the franchise by institutional clients in Europe and benchmarked the bank’s performance against scores for rival dealers.

Comparing these results to the overall addressable opportunity set in European rates products, the Coalition Greenwich team concluded that the franchise was indeed viable. Other U.S. regional banks with similar business propositions and service scores were generating significantly more revenue - a fact that suggested opportunities for growth.

Deeper analysis revealed that current clients were, in fact, quite satisfied with the service and results they received. The problem: The bank had a limited presence in some key regions and client segments where peer competitors were thriving. Rather than shuttering the business, the bank should shift its sales strategy by abandoning efforts to sell to some large prospects and instead focus on closing those gaps with clients more likely to use their services.

Coalition Greenwich produced a name-by-name list of the individual buy-side firms the bank should target in several countries to restart growth, along with a breakdown of how much it would cost to sell to and service these new accounts. Included in that cost estimate was a plan to beef up the bank’s electronic trading capabilities - a step Coalition Greenwich determined was critical to reviving growth.

The Coalition Greenwich team presented its strategic findings to the bank’s CEO and senior management team, and then partnered with the Head of Global Markets Sales to implement tactical recommendations. To ensure the data-intensive engagement would be easy for the bank, the Coalition Greenwich Onboarding Team worked closely with the client to ensure seamless data mapping.

Results

Performance began turning around quickly. The first positive sign was an increase in wallet share among clients on the priority target list. Wallet share and revenues increased further as the Coalition Greenwich team provided ongoing feedback from target clients, allowing the bank to adjust strategy and reallocate resources as needed, including replacing individual sales professionals who weren’t connecting with specific clients.

Thanks to this accelerated growth, the bank climbed to become a top 10 dealer in European rates products in just 24 months. This success generated another unexpected benefit in the form of increased revenues from U.S. clients using the revitalized franchise to trade fixed-income rates products in Europe.