Within the banking industry, Enite services the Energy Trading, Facilities and Emerging Markets sectors. Clients operating in this industry are taking a hard look at profitability and performance, and are developing new products and revenue sources involving energy. Summarized below are some of the current industry trends and issues that banking clients with an energy focus are facing, and examples of how Enite can serve these clients:
Physical Energy Trading
In the past several years, banks have begun expanding their energy trading beyond the financial markets and into the physical commodities themselves. Physical energy commodities require the development of new trading operational capabilities including; scheduling, and risk management, regulatory reporting (federal & state) and physical settlement / accounting expertise specific to the commodities themselves.
Examples and Opportunities:
- Development of market entry strategy
- Evaluation of capability requirements and gaps across people, processes, and technology
Facilities
To capitalize on opportunities and penetrate unexplored markets, banks have begun to engage in areas normally reserved for oil & gas firms and utilities.
Examples and Opportunities:
- Strategy for hedging exposure to price of fuel used for new facilities
- Development of ongoing risk management strategy for underlying commodities for new facilities
- Valuing cost of capital to build facilities, timing, and underlying products
- Development of asset management strategies (and requisite organizational design and technology selection)
Emerging Markets
Financial institutions typically employ aggressive growth strategies and periodically look for unique opportunities to take advantage of early entry into new markets.
Examples and Opportunities:
- Development of strategy to compete in emerging climate exchange, renewable energy and derivatives markets (e.g., steel and iron ore, Renewable Energy Credits, Wind / Solar power)