Even the very Italian CCBs rely on foreign banks
The British Allfunds Group, one of the world's leading B2B Wealth Tech platforms in the fund industry, will buy the Correspondent Banking and Agent Banking activities of Iccrea Banca on an exclusive basis. All the details
The very Italian Bccs with Iccrea rely on foreign banks. Here are facts and insights.
ALLFUNDS AGREEMENT AND ICCREA
Allfunds Group, one of the world's leading B2B Wealth Tech platforms in the funds industry, will acquire the Correspondent Banking and Agent Banking activities of Iccrea Banca with the related exclusivity agreement.
WHAT IS ICCREA
Iccrea Banca is the parent company of the BCC Iccrea Group, the largest Italian cooperative banking group, in fourth place for total assets (173.5 billion euro) and second for number of branches in Italy (~2,440).
THE BCC GROUP CREATES
The BCC Iccrea Group was established in 2019 as part of the reform of the Italian Cooperative Credit Banks with 120 cooperative banks.
WHAT THE AGREEMENT PROVIDES FOR
By improving its positioning in Italy in the Correspondent Banking sector, Allfunds will be able to increase its level of customer service and at the same time strengthen its partnership with a major banking group in Italy.
DETAILS ABOUT THE TRANSACTION
The transaction will be accretive from the first year both in terms of margins and earnings per share. The transaction will also have a neutral impact on the liquidity position of Allfunds Banking Group, as the acquisition will be fully financed through an Allfunds Group revolving credit facility.
WHAT DOES A CORRESPONDENT BANK DO?
A correspondent bank is a credit institution entrusted with the execution of banking services on behalf of another bank. From a legal point of view, recourse to a correspondent bank is expressly provided for and authorized by art. 1856, 2nd paragraph of the civil code, the provision of which represents a legal authorization for the agent to be replaced in the execution of the mandate (art. 1717 of the civil code) with the consequence that the customer who has given the bank the assignment can assert his reasons, in the event of failed or negligent execution of the assignment, directly against the correspondent bank. The relationships that bind two correspondent banks (see correspondence, relationship) concern the performance of services, mostly under conditions of reciprocity, on different markets, in order to ensure these services to customers even on markets where the bank does not have its own counters.
Collection operations (cheques, bills of exchange) and payment instructions (wire transfers) are regulated through correspondent banks, on the basis of agreements which define, among other things, the fees paid to the delegated bank (agent) and execution times. The transfer of the countervalue of the transactions makes use of special service accounts (see interbank current accounts) normally settled under conditions of reciprocity with regard to the value date of the transactions, to the bank days necessary for the completion of the administrative procedures connected to the collection of bills and credit instruments and at the rate applied to account balances.
BRITISH BANK ALLFUNDS COMMENT
Juan Alcaraz, founder and CEO of Allfunds, said: “I am very satisfied to have concluded this agreement with Iccrea Banca, parent company of the BCC Iccrea Group, one of the main players in the Italian banking scene. Being one of our main markets, where we have been present since 2003, this operation will contribute to our ambition to remain the first choice for any Italian player in the WealthTech segment, providing cutting-edge and comprehensive solutions for our clients. Our integrated offer will certainly help Iccrea to provide superior added value to its customers”.
THE WORDS OF THE GENERAL MANAGER OF THE BCC ICCREA GROUP
Mauro Pastore, General Manager of the BCC Iccrea Group, stated: “This agreement fits into the strategy of the BCC Iccrea Group aimed at supporting development projects in the asset management area, to which the correspondent bank is closely linked, and at improving the level of services related to access to financial markets provided to our CBs and their customers. This transaction will allow us to capitalize on the value of these assets, which we have deemed strategic to sell to one of the main market leaders, also in the light of an increasingly competitive and concentrated context, and to further increase our already solid capital ratios".
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/anche-le-italianissime-bcc-si-affidano-a-banche-estere/ on Fri, 28 Jul 2023 10:31:02 +0000.