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98 Percent of CEOs Rely on Large U.S. Banks to Operate and Compete Globally

Washington – A Business Roundtable report released today reveals how critical globally engaged U.S. banks are to the success of large American companies. According to the findings included in “Business on Banking: How Large Financial Institutions Help Companies Create Growth & Opportunity for America,” 98 percent of Business Roundtable CEOs, representing every sector of the economy, report that they rely on the unique and valuable services that large financial institutions provide in order to run their businesses.

“We always knew that Business Roundtable companies depended on large, globally engaged U.S. banks for financial services to help make them competitive abroad, but this study reveals the full extent – and it’s significant,” said Business Roundtable President John Engler. “As Washington considers imposing additional regulations on large banks, policymakers should take into account how integral these banks’ products and services are to U.S. businesses and U.S. growth.”

To better understand the degree to which its members rely on the services of these financial institutions, Business Roundtable conducted a survey of its 211 CEOs in July and August, with nearly 70 percent (148) completing the survey. Among the key findings:

  • Nearly all of the respondents (98 percent) reported that their companies rely on large, globally engaged U.S. banks to facilitate domestic operations, while 89 percent rely on them for their foreign operations.
  • Companies access a mix of financial products and services, including debt and equity offerings, foreign exchange, large loans, swaps and derivatives, and trade finance. Approximately 70 percent of CEOs indicated that three or more of these products and services are “essential” to their companies’ operations.
  • The CEOs also weighed in on the usefulness of individual functions performed by these banks. More than 80 percent reported four products and services as essential or useful, including Cash Management (88.2 percent), Foreign Exchange (82.4 percent), Debt and Equity (80.7 percent) and Cross-Border Payments (80.7 percent). Four other products or services were rated above 70 percent, including Mergers and Acquisitions (78.2 percent), Access to Foreign Markets (77.3 percent), Large Loans (77.3 percent) and Swaps and Derivatives (70.6 percent).

The CEOs, several of whom provided specific anecdotes included in their responses, noted that other important benefits flow from the intangibles that large banks provide – including advisory services, links to local business networks and a ubiquitous financial infrastructure.

Find the complete report and an executive summary here.