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Enron Mail |
While I agree with most of your points, I would like to stress that the bus=
iness units still lack the direction and skills necessary for building an i= nternational business. One of our biggest difficulties has been dealing wi= th originators, logistics managers, and support staff who lack experience i= n international trade. To have a centralized international credit function= we will need a centralized international support staff. Trades within high risk countries with limited information is not where we = or the market has historically had much risk appetite. We have continued t= o focus the commercial teams on risk syndication and have proactively appro= ached banks on different mechanisms for laying off risks where possible. W= e need to think about what risk tolerance we are comfortable with accepting= to help grow this business. I agree we have had the foresight to focus on building the necessary skills= to support the business growth but have not done a good job of proactively= communicating the credit risks inherent in the international businesses. = Both Tom Moran and Ken Curry have decent experience in international trade = and l/c's but have not taken a proactive enough approach with the business = teams. I have addressed this issue with both of them in the PRC. I think = John Suttle has done a good job getting up the curve on issues and has take= n an active approach on liasing with Sydney banks and hiring the necessary = skills sets in Australia. As Ted noted the hiring of John Collinette has b= een a big plus for the London team. Although it is not their day to day re= sponsibility, both Debbie Brackett and David Hardy have more international = trade experience than most in the marketplace. Effectively the International Credit Group is well structured with the cred= it teams supporting the internatinoal businesses. Collinette/Ngo/Suttle - = Metals Curry/Rohauer/Maley/Nelson/Suttle - EIM Moran/Rohauer/Maley/Nelson/Suttle - EGM This is a very detailed business and I think we have lacked the coordinatio= n across offices. We need to improve communication and continue to develop= the necessary depth in our teams to meet the business objectives.=20 Let's discuss in the coming weeks. Bill -----Original Message----- From: =09Murphy, Ted =20 Sent:=09Tuesday, September 11, 2001 8:13 AM To:=09Buy, Rick Cc:=09Bradford, William S. Subject:=09International Credit Rick, While I am not 100% sure of what Greg means by international credit, both B= ill and I have recognized that there is a facet of RAC/Credit function tha= t we are not net long vis-a-vis the direction of the business, particularly= the non-energy commodity businesses - steel, metals, paper - as well as th= e coal business and the crude complex. What seems to be needed is some peo= ple that have experience in structures (good and bad) that support the move= ment of large packages of physical goods from the 3rd world to the first wo= rld. Knowledge of the subleties of l/c language, insurance products, dog c= ounterparties, typical scams, money launderers, lay ranges, demurrage....To= that end, we both interviewed and subsequently hired John Collenette, head= of credit for an international trading organization - Trafigura. John spe= nt 10 years at Paribas and then the last 7 at Trafigura. He went through 3= full rounds of interviews, primarily with the metals guys and incuding Mic= hael Brown. My plan was to install him as the 'team lead' in metals allowi= ng him to get 'enronized' with the idea that he would expand his role to in= clude global products and EIM. I guess I will accelerate this process. In addition, I have also hired a sr spec with metals experience from Koch. = We have interviewed a few other prospects with transactional credit experi= ence. We are planning to supplement some of this industry knowledge with T= racy Ngo and a few strong managers with solid credit skills. The issues we= have yet to begin getting traction are how to staff other offices - NY and= Sydney principally. Here we are constrained by current budgets. Also, I have worked with the operations staff to take away some of the oper= ational credit issues like chasing down information, money laundering check= s, calling for margin, and opening accounts so that we can hire credit pro= fessionals to analyze credits and deals. =20 Finally, a critical piece of the puzzle is to also strengthen the people an= d the processes around the logistics of credit - specifically, the logistic= s function, treasury (l/c issuance/acceptance), and risk management. It is= in the hand-offs of infomation where most of the risk lies, in my opinion.= =20 When you are here, we ought to make that a topic for discussion. Not to ov= er-state the need, I think it will require somewhat of an on-going focused = effort and coordination between offices and departments similar to the EES = style. Ted
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