Senior banker (coverage)

In this article, Frédéric ADAM (ESSEC Business School, Grande Ecole Program – Master in Management, 1990-1993) explains the job of (dedicated) salespeople in banks, who deal with global corporate customer needs. There are generic terms for this type of job : we are going to speak either about “senior banker” or “(global) relationship manager”, that can be included in the so-called “coverage” .

Introduction: Coverage at the “center of the playing field »

The term “Coverage” (or more commonly “customer relationship manager”), stemming from the Anglo-Saxon world of finance, has become an increasingly essential cog in the banks to serve their customers, as finance business became more and more complex from the 1980s, giving rise to the advent of the main commercial business lines, embodying expertise/financial engineering in different forms, which can be grouped into the five main following families:

• Transaction banking: cash management, correspondent banking, receivable & supply chain finance, trade & export finance
• Financial markets: treasuries & bonds, derivatives & FX, stocks & commodities
• Project finance: real estate, shipping & aeronautics, infrastructure
• Mergers and acquisitions (M&A)
• Corporate & Structured finance: LBO, debt restructuring & advisory, securitization

At the same time, the so-called “support” or “transversal” functions in banks have undergone a similar evolution (development and complexification). These professions have gained in increasingly varied and specialized skills, but also in number, especially in the risks, legal and compliance departments.
This evolution contributed to put the “coverage” at the “center of the playing field”. These “support business lines” can also be grouped into the five main following families:

• Back-office
• Risks, Permanent Control & Audit Department
• Finance & Procurement Department (including asset and liability management (ALM))
• Compliance & Legal Department
• IT Department

Coverage players: common points and differences between banks

There is an initial invariant in all banks, whether they operate as retail banking actors (for individuals and small businesses) or investment banking actors (for large corporates). You can only access the senior banker after a first (successful) experience, mostly, in commercial business lines. Knowledge of the offers made by the commercial business lines, but also of the internal processes of the banks, in particular on the risk component, are logical prerequisites.

Then, depending on the typology of the banks, these prerequisites may differ (in number, or even in duration of experience), namely:

• Retail banking: a preliminary experience in Transaction Banking or on (Corporate) Risks will be appreciated
• Corporate & Investment banking: Transaction Banking remains important, but it will often be supplemented with a 2nd commercial line experience / skill, the trend being to seek more M&A profiles for Large Cap coverage in recent years

Finally, the organization of coverage is not the same according to the typology of banks:

• Retail Banking: customer relationship management is often carried out by one person, named « chargé d’affaires entreprises » (or business manager), supported by 1 or 2 assistants, dealing with the risk aspects (monitoring of banking commitments) and day-to-day flow business issues.
• Corporate & Investment Banking: on large customers, the model is often available with a pair of senior banker (lead) / relationship manager (back-up) type, who monitors the risks (commitments) of the customer, but also is in a lead position on various commercial issues, except for the high value-added component, namely the M&A assigned to the senior banker.

The (common) mission of Coverage players: embody & simplify “One Stop Shopping”.

What is “One Stop Shopping”? It aims at identifying the customer’s needs and, to orient / put in contact, like a “guidance service”, the customer, towards the right expert(s) in the five main commercial lines. To do this, the pitch is a recurring tool, which is a client presentation, outlining “what I understood of your needs” and the business line solutions that the bank makes available to the client to address these needs. A “coverage pitch” can thus often lead to a more detailed/specific “business (line) pitch”, with an indicative / dedicated commercial proposal, often called an “early bird” (pricing is then given provided…).
This ability to articulate coverage with the commercial business lines, and thus allow the customer to do their shopping at a one-stop shop / single entry point, contributes to the attractiveness of the job, in particular with Large Cap, which have complex and numerous issues, and demand a very high level of responsiveness. Thus, for a Large Cap, having valuable and responsive coverage in particular, with which it maintains a close (trustfully) relationship, can prove to be a decisive competitive advantage… For example, during an external growth operation, the financing of a major international contract or a radical transformation of its business model (and its associated capital expenditure needs).

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Useful resources

Soraya Haquani (February 24, 2011) Les nouveaux visages des banquiers conseils L’AGEFI Hebdo.

Alumneye (September 7, 2021) 5 questions sur le Coverage en banque d’investissement L’AGEFI Hebdo.

Bogler Marc (June 4, 2021) Le Coverage en Banque de Financement et d’Investissement LinkedIn.

About the author

Article written in February 2022 by Frédéric ADAM (ESSEC Business School, Grande Ecole Program – Master in Management, 1990-1993).