Finance Tips

From Herve Bonnet, President/CEO, CGI North America, Inc.

1 - What are you seeing as the major changes/trends in financing/refinancing (during this challenging time for the industry)?

Like most other industries, the biggest change in marine finance happened a few years ago. The downturn of the economy led to market contraction causing several lending institutions to re-evaluate their position. Most marine lenders tightened their buy-box to compensate for losses on loans closed a few years ago while the market was extremely competitive.

In the last two years, we have seen the consolidation of marine lenders while other lenders / brokers left to focus efforts on their core businesses. The effects of the crisis resulted in the tightening of the credit policy. Credit policy required higher FICO scores, improved and reinforced collateral evaluation and a focus on the client’s strong liquidity.

Since our arrival two years ago, our strategy has focused on a conservative and innovative approach to address a niche market; conservative in making sure that we adopt local and corporate best practices, and innovative in that we wish to accompany our clients in all their marine lending needs.

2 – How is CGI NA adapting and working with clients to adapt to these changing times?

As a wholly owned subsidiary of the Societe Generale Group, one of the largest international and diversified banks in the world, we have an armada of tools allowing us to be proactive and reactive to our North American clients especially during exceptionally difficult times. All CGI North America (CGI NA) entities adopt best practices when it comes to knowing your customer (KYC), knowing your partner (KYP) and knowing the boat (collateral). We review each loan ensuring that we have the right client (strong financials and liquidity, FICO scores over 700, long boating experience and expertise), the right partner (reputation, experience and strong financials), and the right boat (surveys, BUC/NADA evaluation, regular inventory checks...)

3 – What do you think is the best customer approach?

One of our major goals is to satisfy all the needs of our customers. We take care of them from the day they buy their first boat to the day they sell their last. CGI NA acts as a “one stop shop” for those who want to have the appropriate financing needs (CGI Finance), marine brokerage (Scott Financial Services) and documentation services (Atlantic Yacht Documentation - AYD). Moreover, we offer to our North American clients the unique possibility of international marine financing thanks to our global network of marine expertise.

When a client comes to us, he/she knows that they don’t have to worry anymore about all the bureaucracy, delays and troubles resulting from dealing with different companies. Unlike our competitors, we focus on building a partnership, not just the single financial transaction, with our clients. We stand by our clients, our partners, and show our professionalism and our innovation by anticipating their needs today and tomorrow. We do regular US market research and reviews, and are present at all major local and national boating events with a goal of always being in the forefront of development.

4 – What aspect of partnerships do you see as beneficial to the entire industry?

The market contraction drastically reduced the number of players. The companies that survive and remain successful in the business are those that have the right knowledge, expertise, and reputation.

Being partners with experts in the marine industry is beneficial to clients because we can provide the necessary resources, expertise and guidance all throughout the marine relationship. Our success is built through partnerships, not just one-off deals. We only work with solid financial institutions and with the best brokers in terms of their knowledge and experience of the best marine lenders.

Societe Generale, CGI’s Parent Company, is one of the largest financial services groups in the euro-zone. The Group employees 157,000 people worldwide and focuses on these key areas: Retail Banking; Specialized Financing and insurance; Private Banking, Global Investment Management & Services; and Corporate and Investment Banking. Societe Generale is included in the socially-responsible investment indexes: FTSE4Good and ASPI. In 2010, the title of SAM Sector Mover was awarded to Societe Generale.