Mitsubishi UFJ Financial Group (MUFG) has ramped up its supply chain finance offering with an agreement to buy the Trade Payables Services (TPS) platform from GE Capital, which is exiting from corporate banking.
Since hiring Maureen Sullivan as head of supply chain finance for the Americas in March last year, the Japanese bank has been seeking to expand its client portfolio, and with the acquisition of TPS, MUFG is gaining a platform serving over 30,000 GE suppliers worldwide. Speaking to GTR, Sullivan says: “TPS is a robust platform designed to provide supply chain finance solutions for both captive GE businesses and third-party entities. The GE programme will be our initial priority, and we expect over time to add new clients to the platform. The supply chain finance programme will address GE’s working capital objectives and provide liquidity to suppliers around the world.”
Following the close of the transaction, MUFG Union Bank will assume management control of the systems and processes supporting the supply chain finance activities that GE Capital performs for GE. Terms of the deal were not disclosed, and no information was available on the terms offered to suppliers using TPS. “Through the addition of TPS, MUFG is now able to deliver a full suite of working capital solutions that address our clients’ growing needs to optimise short-capital positions,” says Sullivan.
Jon Lindenberg, head of MUFG’s investment banking for the Americas, says: “Global supply chain financing is undergoing significant change driven by new fintech entrants, adoption of blockchain and other market-driven disruptions. By acquiring TPS, MUFG gains its flexible, state-of-the-art functionality immediately.” He adds that over the long term, the bank will make “incremental investments” in the TPS platform in order to further differentiate its supply chain offering from that of its competitors.