JP Morgan continues Africa expansion
JP Morgan will now offer escrow services in South Africa; a move in line with the bank’s decision to expand more broadly across Sub-Saharan Africa.
The escrow services, which will be provided in rand and other major currencies, will assist clients in mitigating risk in relation to trade finance and other transactions.
According to Chris Martin, managing director of JP Morgan’s treasury and securities services in Sub-Saharan Africa, escrow is just one of a set of cash and trade products that the bank has launched in South Africa over the past eight months. More products will come on line during the course of the year.
“We launched high-value rand clearing in November last year, and low-value rand clearing in April this year. The escrow services are just another arm to those core cash products,” he tells GTR.
While JP Morgan has been actively engaged in trade financing in Sub-Sahara for some time, all the deals that it has participated in thus far have been booked offshore. But with its new services in South Africa, Martin explains the bank will be able to build local balance sheet, and transact and support clients on rand transactions in country.
He further notes that the bank’s expansion is focused more on providing for the needs of its multinational corporate (MNC) clients in the Sub-Saharan Africa region, and less on moving broad scale into the local corporate markets.
“We’re giving our MNCs the opportunity to continue to use JP Morgan – as they had been internationally for their trade finance needs – in Sub-Saharan Africa.
“It gives clients more choice and opens up the market to allow more players. It’s a natural evolvement for the South African market to have more international players visible.”
The bank also plans to open representative offices in Ghana and Kenya by Q3 this year. According to Martin, the bank is “well-advanced” in terms of premises and hiring for the new offices.