Bank of America is everywhere in the US. It serves one in five mid-sized corporates (those with revenues of between $5 million and $2 billion) and you can’t do that from one national headquarters.
“Covering our middle-market business, we have Sue Caras and Ken Ullmann, neither of whom are based in New York: Sue is in Washington DC, Ken is in Dallas,” explains Faiz Ahmad, head of global transaction services at the firm. “Leadership for this segment has to be based where the clients are based. It is still one of our most dominant franchises.“
This shows and the bank’s relentless investment in digital innovation has paid dividends not just among blue-chip clients but right across the market, both in terms of size and geography.
“I have been surprised by how some of our most complex solutions have been rapidly adopted by small and medium-sized enterprises,” Ahmad says. “But an even greater percentage of early adopters is the family-owned company segment via our private bank, who are quick to recognize the upside of new innovations that can improve their margins.”
The year saw more new product launches from the firm, including Recipient Select, which is the first business-to-consumer secure digital payout portal through which firms can manage customer data and payments. Launched in October last year, it features six payment options: Zelle, PayPal, RTP, ACH, Check and Pay to Card.
The following month the bank launched CashPro Forecasting, which uses machine learning and clients’ own data to improve visibility into cash flows and improve strategic forecasting. This is the first product in the market to incorporate machine-learning technology in this process, something that will likely prove very powerful for corporates that have limited treasury resources.
“For our global commercial banking sector, many of our clients operate with limited resources within their treasury departments,” explains Caras, co-head of global commercial banking sales, global transaction services (GTS). "By optimizing technology across AP [accounts payable] and AR [accounts receivable] process flows, clients are able to automate or even outsource tasks, which allows them to redeploy two or three people elsewhere – and that has a meaningful impact on their bottom line."
The entire treasury function has essentially been made available on the CashPro app. The prospect of managing it from your mobile phone is an appealing one for many treasurers, whether they are existing clients or new to the firm.
“A forest products company was looking to setup a blueprint for the future of their treasury,” explains Matthew Davies, head of global transaction services, Europe, Middle East and Africa and global co-head of corporate sales, GTS. “We didn’t have any business with this company. We went through an RFP [request for proposal] and were awarded all of their Canadian and US cash management, unseating the incumbent banks because of the quality of the advice we gave them and the time we took to understand their strategy.”
I have been surprised by how some of our most complex solutions have been rapidly adopted by SMEs
The bank spends a great deal of money on innovation in treasury, but it does so carefully.
“When considering a new product innovation, we always consider how it would benefit the broader client base,” says Ahmad. “That said, we do sometimes build a bespoke product solution. At the end of the day, it is all about making sure that the payment and corresponding data moves from point A to B.”
The business is also active in environmental, social and governance initiatives, a strong focus across BofA. Following the death of George Floyd last year, GTS set up the Breakthrough Lab, designed for pre-seed startups focused on financial technology and financial inclusion with founders from Black, Hispanic, Latino and other underrepresented groups. The pilot programme involved five startups based in New York, and the programme will officially launch in September this year with 10 startups involved.