The Banca IFIS Group is the only independent banking group in Italy that specialises in the sector of trade receivables, non-performing loans and tax receivables.

The brands and divisions through which the Group operates are:

Banca IFIS, dedicated to supporting the trade receivables of small and medium sized enterprises operating in the Italian market;

Banca IFIS International, for companies growing abroad or based abroad and working with Italian customers;

Banca IFIS Pharma, supporting the trade receivables of local health services’ suppliers;

Toscana Finanza, which brings together all the activities of the business unit operating in the non-performing loans sector;

Fast Finance, focusing on the tax receivables sector.

Listed on the Star segment of Borsa Italiana, the Banca IFIS Group is an innovative and steadily growing company.

Trade receivables

Banca IFIS

In 2011 over 3,000 small and medium sized enterprises received customised answers from Banca IFIS aimed at resolving specific lending problems and ensuring financial support. In particular, Banca IFIS managed to address the financial and credit management needs of companies which, despite in some cases having limited creditworthiness, boast supply relationships with customers of good credit standing. The asset-based method, usually applied for large businesses and which Banca IFIS is the first in applying for SMEs, allowed the Bank to lend to companies by transferring the credit risk to their customer, i.e. to the account debtor. This method’s peculiar assessment and authorisation criteria are based on the credit quality and the productive capacity of the company, rather than its equity, leading Banca IFIS to finance not its customers’ solidity, but rather their ability to perform well. We at Banca IFIS believe this is what businesses, the economy and Italy need to regain confidence after years of hardships.

The Bank’s intervention is based on a key and constant element, which is the transfer of trade receivables from the customer to Banca IFIS, and on financing them in a very short time period. For Banca IFIS financing a customer means providing companies with the resources to run and expand their business. However, the lending business on its own does not explain how the Bank’s product range is structured. Leveraging trade receivables to provide companies with the necessary support to develop entails new possibilities, whose mix generates intrinsically better results compared to traditional bank lending. In fact, in the traditional approach to lending, the bank’s risk analysis is based on the company-customer and its creditworthiness. In Banca IFIS’s approach, the trade receivables the company-customer manages to generate are assessed: this leads to a new way of providing credit, with the inevitable introduction of new features which would be unthinkable in the traditional generalist approach.

For the company-customer, therefore, dialogue with Banca IFIS becomes not only a financial issue, nonetheless crucial as especially small and medium-sized enterprises often need resources urgently to finance their business; it is also a matter of managing credit, and in this sense smaller companies often see an advantage in letting a specialist bank professionally manage their receivables, while also larger companies consider the outsourcing of such a delicate process as managing their accounts receivable as a way to generate value; and it is also a question of controlling the risk of the final debtor, in the sense that Banca IFIS’s assessment on the quality of the account debtor, i.e. who in the end must repay the trade receivable, is crucial. Banca IFIS will not act if the final debtor (i.e. the “customer” of the Bank's customer) does not meet the necessary credit requirements. Moreover, the Bank’s assessment is a very useful service also for the Bank’s customer, who can learn about the quality of its own counterparties and ask Banca IFIS to ringfence it from the risk of losses should its customer default by means of insurance products.

Therefore, intervention by Banca IFIS is not only a question of trade finance. Alongside the purely monetary support, we provide a service to manage account receivables and to assess credit quality which makes it extremely advantageous for the company-customer to use the Bank’s services, on terms which are fully in line with other solely financial services not providing any added value in terms of management, disclosure and also guarantee.

Banca IFIS has a widespread presence throughout Italy, with 27 branches employing over 80 professional staff responsible for customer relations, ensuring an ongoing relationship between the Bank and companies. For Banca IFIS meeting customers at the latter’s premises is the norm, as are high in-house standards concerning the speed, effectiveness, and directness of the relationship between the Bank and the customer.

In order to develop relations with the customers, the Bank maintains local contacts with some qualified institutional counterparties, as well as industry trade groups. In this way, it aims to provide customers/associates with a service that is as wide-reaching as possible.

Knowledge of the local area and customers, together with the business model based on factoring mitigating the relevant credit risk, allows the Bank to maintain a relatively high risk profile for its assets. In particular, the assets’ quality is markedly better than that normally resulting from banking operations involving small and medium-sized enterprises. Those have been affected by the economic situation, and most recently by the recession and the credit crunch after at least four years of market turmoil. This means that the Bank did indeed record losses on receivables, but those are still outweighed by returns on this activity. Most importantly, the Bank continues to operate in favour of companies, even in the face of markets often compelling credit intermediaries to be very prudent in taking on risk on small and medium-sized enterprises.

Banca IFIS International

The start of the international business of Banca IFIS dates back to the end of the 1990s, when the Bank introduced import factoring services for Italian companies which had moved their production to Hungary and Romania.

In 2002 the Bank started to build an international organisation that could offer the whole range of products: export, import and non-domestic operations. In the same year Banca IFIS joined Factors Chain International, the largest factors chain in the world, which currently numbers 255 operating associates in 69 countries. Banca IFIS has entered cooperation agreements with 167 correspondents, 44 of which operating as of 31 December 2011.

Today Banca IFIS is one of the most active players in this segment and stands out due to the quality of its services and its direct presence in foreign markets, such as Poland, Romania, Hungary and India, with around 15 professional staff dedicated to international business full time.

In its international business, the Bank’s ability to act not only as a supplier of factoring services but also as a consultant to those customers who intend to move to new markets or are looking for new operating solutions to propose to their counterparts is crucial. The Bank’s knowledge of the markets and of the various industrial sectors validly supports the exporter in defining some contractual operational aspects.

Export Factoring is the product dedicated to Italian export companies and includes both recourse and non-recourse factoring. In order to offer the service most suited to the customer’s needs, the Bank, depending on the type of operation proposed and the countries involved, can intervene directly or use the services of its correspondents. The recent economic slowdown and the increase in the risk of insolvency have led exporters to particularly appreciate the possibility of insuring themselves against the risk of default, especially with export non-recourse factoring.

Import Factoring is the service offered to foreign companies exporting to Italy. Also in the case of import, services can be offered directly to foreign companies or to FCI correspondents. In the first case, the three services - management, guarantee against the risk of default and financing of receivables – are almost always present, while in the case of operations notified by correspondents, the focus is usually on management and guarantee against the risk of default. It is important to stress that the Bank has been structured in such a way as to be able to enter into a direct relationship with any foreign company, except for those operating in markets with impediments to the transfer of credit. In the last year, owing to the economic crisis in the euro-zone, the Bank has managed to adjust to the market situation, increasing direct relations with foreign exporters also by offering diversified products dedicated to specific sectors.

In the business segment of non-domestic operations two foreign counterparts are involved: the invoice seller and the account debtor. Generally this type of product envisages the use of non-recourse factoring as the primary choice. Offering non-domestic operations requires a sound knowledge of the law of the countries involved, with particular reference to the conditions required to guarantee that the transfer of the receivable is valid, both for directly managed dealings and for those notified by FCI correspondents. The excellent ongoing relationship with correspondents and the high quality of the service offered by the Bank ensure that overseas correspondents often turn to Banca IFIS for operations involving debtors resident in European countries.

Banca IFIS Pharma

In 2010 Banca IFIS started a new business dedicated to creating new integrated management solutions for pharmaceutical companies wishing to transfer non-recourse receivables due from the Public Administration, thus freeing themselves from the risk of delayed payment. Purchasing these receivables, as they are due from the Public Administration, implies less exposure to impairment and good returns. In 2011 this business continued, building solid relations with the main industry players and laying the foundations for growth in operations as from the first weeks of 2012.

Non-performing loans (NPLs)

Toscana finanza

This is the division of the Banca IFIS Group dedicated to non-recourse factoring of non-performing loans. Toscana Finanza SpA, which was bought in May 2011, was merged into Banca IFIS S.p.A. in December 2011.

Toscana Finanza is present in two Italian cities, Florence and Milan, and was founded in Florence in 1987. In its twenty year history it has stood out for its ability to value and buy important portfolios and to establish a remarkable database containing specific information relating to more than three hundred thousand debtors.

Today it is one of the market leaders, buying – largely from consumer credit institutions and banks - mainly non-performing and unsecured loans due from individuals.

The business model is based on its ability to optimise both the purchase and management of receivables. As for purchasing, assessing the estimated portfolio risks by using sophisticated proprietary statistics software is crucial.

As for management, the credit portfolio is processed in-house by Toscana Finanza in accordance with the highest standards of ethics, transparency and respect which are the foundations of the company’s reputation and renown.

Tax receivables

Fast Finance

Fast Finance is the company within the Banca IFIS Group that specialises in purchasing tax receivables arising from insolvency proceedings: it offers to buy both accrued and accruing tax receivables on which repayment has already been requested or will be requested in the future, and which arose during insolvency proceedings or in prior years.

Based in Bologna, it is a leading company in the services for insolvency proceedings. It was created in 2001 and has been part of the Banca IFIS Group since May 2011.

Receivables are factored without recourse and without any cost for the seller, with Fast Finance taking responsibility for all costs regarding the valuation, transfer and management of the receivables, including those relating to the issue of any surety bond that may be requested as guarantee by the tax authorities before effecting the repayment.

The high level of technical know-how acquired thanks to its long experience in this sector enables Fast Finance to offer the Parties involved in Proceedings qualified assistance and the utmost efficiency in managing operations through detailed analysis of every position, with particular attention to the type of tax, the formation period, the amount, the possibility of collection and the timeframe for the repayment.

Fast Finance has eight Area Managers who work on a daily basis with the courts, offering qualified assistance to the Parties involved in Proceedings by detailing them on the operational aspects, as well as supporting the Professional in preparing the documentation and working with him to handle and resolve any problems which may arise in the preparatory stage.

Fast Finance is also registered in the ordinary section of the General List of Financial Intermediaries pursuant to art. 106 of the Consolidated Law on Banking, and is therefore subject to strict control procedures by the Bank of Italy, which requires, among others, the integrity and professionalism of directors and shareholders, as well as strong financials.