Corporacion de Occidente is one of the largest financial groups in Guatemala and is composed of several financial entities including Banco de Occidente, Financiera Occidente, Seguros de Occidente(Insurance), a brokerage company, a remittance oriented branch in Los Angeles, and most recently an international banking facility subsidiary in Puerto Rico which opened earlier this year. It is worth noting that financial services constitutes the principal shareholders main activity. Over the last few years Banco de Occidente has consolidated itself as a leader in financial services in Guatemala. Banco de Occidente was the most profitable bank in 1999 and will end in the top 3 for the year 2000. More importantly the bank leads the way in transparency and is paving the way for other banks to follow, as the financial markets become stricter within the country as well as internationally. A tangible example of the latter is that Banco de Occidente became the first Guatemalan Bank to obtain an international risk rating from Thompson Financial BankWatch earlier this year. Evidence of this are the ample credit lines granted from Correspondent banks both in the U.S. and Europe holding 16.32% of such funding. And even from regional banks, the bank has the largest credit facility from Central American Bank of Economic Integration (CABEI) in the Guatemalan financial system with a $48 million line of credit.
But in order to unravel the recipe for success one must discern the overall strategy of the bank, its vision, its organization and its HR component. In terms of strategy that bank begun cutting fat five years ago, getting rid of divisions that were superfluous and even branches that were not generating profits. The vision of the bank was to position itself as a leading provider of corporate financial services in Guatemala and cater to its existing corporate base and expanding in the multinational sector. Bringing the vision into reality required the organization of a matrix whereby client needs are resolved both from the account and product manager sides. Once the structure was defined the bank went out to hire personnel with experience and knowledge in each of their fields. As we will see in the product description below the bank is well organized to meet even the most sophisticated corporate needs having specialized areas in Investment Banking, Cash Management and the leading Trust Department in Guatemala.
The combination of sound financial practices and transparency in its operations with specialized product expertise has resulted in success for the corporation and its main differentiation with the competition.
 Corporate Banking |
The strategy of the bank clearly lies in focusing on the corporate market. Within this market Banco de Occidente is focused on the largest companies with whom it pretends to build partnerships that involve the utilization of the bank's complete product line. Amongst the products that distinguish the bank from the competition are cutting edge technology corporate cash management products, trust services designed to promote and finance corporate projects, and advisory services for complex financial deals. The bank has a core of top clients who are the largest borrowers and to whom it provides multiple specialized services mentioned above and a growing number of multinational corporations that have Occidente as their principal bank. Being among the best-capitalized banks in Guatemala the bank has ample facilities to finance international investors in local projects as well as the ability to obtain specialized project financing from international sources. More precisely then, Banco de Occidente has the clear objective of consolidating and strengthening its position as the leading corporate bank in Guatemala.
The Corporate Bank has the objective of providing a dynamic and agile service that supports companies in maximizing the use of their capital. In order to achieve this we count on the expertise of professionals specialized in a particular sector of the economy, dividing ourselves into the following sectors: agriculture, commerce, construction, industry, services, government and medium size enterprises. We have an ample base of national and multinational companies in each of these sectors who can, in any given moment, give references of our service to new investors in their particular field.
| Financial Advisory Services |
The department of Financial Advisory Services (FAS) was created with the objective of offering our clients high quality financial advisory services utilizing the latest tools and techniques available and adapted to our client needs and the legal and business environment.
The department participates in projects in the areas of: mergers, acquisitions, spin-offs, IPO's, valuations, private placement of capital, leveraged by outs, project finance, and restructuring of debt. The focus that we give each project is unique and creative and is structured with the ultimate goal of maximizing benefits to our clients. In order to achieve this it becomes necessary to utilize a "Deal Management" approach where our involvement is from the conception and proactively working with the promoters of the projects.
Our staff has international experience in Corporate Finance in industries like Energy, Telecommunications, Real Estate & Hospitality, Financial, Technology, Services and Government as well as the contacts with foreign sources of financing needed for the successful structuring of such projects.
The advising is directed to companies already established or interested in starting operations in Guatemala. And as such it would be this section of the bank that is especially designed to assist foreign investors in settling down their business in Guatemala. The knowledge and experience of the staff required in these sophisticated financial transactions coupled with the knowledge of the country and its regulations makes FAS to be the ideal financial partner for doing business in the region.
| Trusts |
Banco de Occidente, through its Trust Department, is the leader in the Guatemalan financial market in structuring businesses through the vehicle of a trust, with trust assets under management exceeding US$200 million.
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The department and its qualified staff count with ample experience in the structuring of projects, handling of concessions, guarantee structures, managing of public / private funds, investment and pension funds. The success attained resides in the department's ability to take international models and adapting them successfully to the legal and fiscal framework of Guatemala in order to make projects feasible that would otherwise lack space in a traditional banking scheme.
The department has acquired experience in the field of project finance, concessions, and guarantee structures as foreign and local investors have required the implementation of a trust to guarantee both investors and creditors in several recent projects. Indeed the figure of the trust in Guatemala makes sense when entering the commercial market to set up a business. The structuring of businesses by means of a trust is well-regulated in the Commerce Code and related provisions in other commercial and financial laws of Guatemala, which provides the legalcertainty and a protected framework for investors in their transactions.
Among the most relevant private trust agreements, Occidente has served as trustee, as well as arranger of some of the most renown power projects that have been developing in the country. Most of the projects are being supported financially by International development agencies such as OPIC, IIC, IFC & CABEI.
Besides the private sector, Occidente is also a leader in the public sector arena and has a well-diversified portfolio of trusts. It is the trustee of the fund responsible for the maintenance of all the road network of the country and manages the first toll road concession to a Mexican Firm. Additionally, the trust department manages international funds dedicated to protect natural resources and promote environmentally sound projects and also holds a trust for the Municipality of Guatemala dedicated to the modernization of the property tax and urban development. Most recently the department has earned the management of important pension funds.
| Cash Management |
The Cash Management Department is driven by the changing needs of companies as well as the constant change in technology, and is committed to constantly developing the best solutions for the corporate client. In terms of strategy we want to be able to provide all cash management solutions required by a company so that we consolidate all the operations of our clients at the bank, and provide an integral solution for the company.
The Department offers a series of cutting edge technology products aiming at improving the cash management process of companies in the areas of collections, payments, and account management. In the conception of the different products and services we have utilized elements of technology and have adopted best practices in order to produce tools that are useful to corporate treasurers, and that have high quality standards in terms of functionality and security.
Our electronic banking service, Enlace Corporativo, awards the corporate client the ability to conduct multiple transactions from their offices via a secure connection to the bank via modem or Internet. Access is authenticated through the use of personalized tokens that guarantee the confidentiality of the user at all times, as well as permitting the set up of various levels of authorization in the case of transfers. Utilizing the latest technology under an umbrella of security we are able to offer: on line access to accounts, detailed on line information of collections, on line and real time execution of payroll and payment to suppliers through direct credit to other accounts with the bank, and loan information.
Most recently we have added the ability to pay utilities on line such as electricity and phone as well as the ability to instruct the bank to generate electronic checks to be picked up at our branches by an employee or supplier. Other innovative recent projects include the launching of a smart card for the payment of the only toll road in Guatemala.
The department is thus involved in the constant development of solutions in the area of cash management and has the capacity to build personalized solutions fitted to the particular customer needs. In terms of foreign investments in the country one can visualize the facility with which the local accounts can be managed from a centralized treasury abroad complete with the capacity to conduct transactions. We are quite strong in delivering solutions on the collection side where we have several clients who are updating their account receivables into their integrated information centralized system such as JD Edwards, sap, etc.
The department also manages the tax collection for corporations where we have a considerable progress and have become the fourth local bank in terms of collection with far less infrastructure than our peers. We have seen the importance of this service to our clients and are investing in developing ways to automate the declaration and payment process jointly with the Tributary Authority.
Finally and as a support to foreign investors and multinationals coming to do business in Guatemala Banco de Occidente is the partner bank of Bank of America for their Conexion Americas Project which provides a network of banks in the region for companies doing business here. The latter speaks well of the banks cash management practices and standards as we were selected under this criteria.
| CONCLUSION |
In this brief description of our most specialized products we have tried to convey our strengths as well as offer our financial assistance when you arrive in Guatemala. |
