Banco Daycoval is focused on credit, particularly in the corporate credit segment, which accounts for the largest share of its operations. The operating strategy focuses on the dispersion of the portfolio, the quality of the guarantees received and maintenance of a balance between the various segments of the economy, to ensure greater business consistency.
Among other initiatives to retain and expand the customer base, the bank intends to enlarge the product mix and open new branches. The domestic economy's current moment – one of rising retail purchasing power and expansion of companies, mainly in terms of credit – enhances the outlook for the bank's evolution and business opportunities. The goal is to grow in a sustainable manner, always supporting clients as it develops and, thus, generate value for shareholders.
To benefit from this scenario, our strategic planning aims to combine dynamic actions and modern operations with a conservative capital structure, based on the following underpinnings:
The focus on the customer is the axis that supports the strategic policy. The proposal is to maintain a close relationship with the client, which many large banks no longer have the structural conditions to offer. At Daycoval, each operation is unique and conducted by the commercial manager and the bank’s centralized back-office structure. With extensive experience in the banking sector, these managers are able to offer personalized service and negotiation conditions that take into account the characteristics and needs of each case and each company. This differentiated treatment is a decisive factor for the growth of the client base each year.
Daycoval seeks to offer differentiated products and services and to be an alternative in relation to large financial conglomerates. The bank's policy is to grant loans that represent only a small portion of the total debt of client companies. To be one of the company's relationship banks, its strategy is to make a difference through its singular service, flexibility in formatting the operation and the wide range of products offered.
With a low level of leverage and highly capitalized, Daycoval's policy is not to assign credit (repassing the operation to another bank due to lack of capital, or funding). In its operations, it uses only funds from its own portfolio and preferably works with "matched operations." To this end, the entire release of funds is a process conducted by the Credit Committees, with the support of the back-office team, so that management has control of the business and assures the cash flow is consistent with the strategic objectives.
The high level of synergy between all areas, including top management, imbues Daycoval's decision-making process with greater agility. Through a less complex and well-organized structure, the proposal for granting credit to new customers is analyzed and approved in approximately 15 days. Companies that already have a close relationship with the bank can see their credit requests approved in one or two days, a speed that can be vital for the customer to take advantage of a business opportunity.
To encourage the search for results and credit quality, the remuneration of commercial managers is linked to performance, which guarantees yields above the market average. Accustomed to acting in very close contact with the client, these professionals visit companies, get to know their potential up close and send a complete visit report to the bank’s back-office containing information that allows us to understand the business and the client's requirements. This ranges from the structure of the company to its perception of the business. Because they know each history in particular, managers can propose specific solutions, compatible with cash flow and operational availability.
All loans granted by Daycoval are backed by guarantees. The bank analyzes the client's needs and seeks to establish a guarantee structure capable of meeting demand and, at the same time, minimizing the risk of the operations. Several alternatives are developed to diversify these guarantees, which include receivables, real estate and vehicles, among others. In this loan system, the quality of the collateral is essential. To monitor, manage and monitor these guarantees, the bank has its own system and specific areas, such as Guarantees Control and Checking, which is in charge of constantly evaluating and validating the guarantees offered.
The guarantees offered by customers are monitored by a proprietary information system, recognized in the market for its excellence. Created in-house, the credit monitoring system, focused on credit for companies, meets the particularities of the bank and this market niche.
With the renovation of the technology base and the expansion of business, the bank augmented its front-office team (front-line professionals who have direct contact with the client) and reinforced the back-office staff in the areas responsible for credit evaluation and approval. For the front-office, the bank opted for opening air branches (located on building upper floors instead of traditional streetside offices) and hiring managers compensated for their performance. In addition to the reduced cost of this structure, these service points expand the number of distribution channels and open up possibilities for the implementation of new products, diluting the development expenses.
With the economic stability, the demand for credit for companies, inside and outside the big city centers, increased and, consequently, new business opportunities emerged. Aware of this, Daycoval is expanding the number of branches in the country, a fundamental initiative for a bank that guides its action strategy in direct relationship with the client.
The strategy for funding and Treasury operations obey the same principles adopted in the granting of credit: conservative profile and constant and consistent growth. The bank continually seeks to diversify its funding sources and to have adequate funding to keep up with the evolution of the loan portfolio. This financial structure is the foundation of Daycoval. Extending maturities and gradually lowering funding costs keeps the bank competitive with regard to credit awards.