The Synergy of Vidanova and SFT Bank

The recently announced acquisition of SFT Bank by Vidanova has actually been in the works for over a year. On January 1, 2016, Vidanova became a 67% shareholder in SFT Bank in an effort to align the two companies, and exactly one year later, they sealed the deal with the purchase of a further 14% of shares.

TEXT BY HELEN GRIFFITH

The primary intention of this recent acquisition is to combine the portfolios of the two companies in order to create a more cohesive banking and pension fund offering. Vidanova has traditionally been a pension fund organization that was started in 1968 to execute pension services and arrangements to companies in the utility sector. They later expanded their clientele to other companies in the private sector so as to maintain its profitability. Since then, they have continued to expand with the introduction of Pension Management services that provide pension administration services to companies with pre-existing pension funds. Vidanova has more recently implemented their Integrated Financial Services Concept. One of the pivotal aspects of this concept involves the acquisition of SFT Bank, in order to offer banking services to their pension clients.

At the same time SFT has been gearing their focus towards local banking, and in particular mortgages. Initially, part of CITCO Banking Cooperation, a worldwide offshore banking company, in 1985 a local division called CITCO Bank Antilles was created in answer to the growing needs of the local banking market. Ten years later, the official name was changed to SFT Bank N.V. and more recently they have further disengaged from CITCO and the offshore banking industry, solely focusing on the local market and expansion of their mortgage services.

It seemed like the two companies were made for each other, and with Vidanova’s acquisition of 82% of SFT’s shares, the bank was renamed Vidanova Bank. There are countless benefits that the two companies bring to the table as they integrate their products and services. Vidanova is able to offer full-service pension and banking to their customers to further improve their service levels. In addition they are now able to offer joint financing to the employers. Banks usually provide short-term financing while pension funds usually provide longer-term financing. But the possibility of combining them into one product for the employer creates added value. “So the idea is not only to service the participant but also the employer. And that’s the fit that we saw with Vidanova Pension Funds and SFT Bank,” as Charlene Alberto, Executive Director of Vidanova Pension Fund explained. From the banking perspective, since its acquisition, Vidanova Bank is extending its mortgage and banking services to the pension fund clients. But there is even greater potential for growth as they are also expanding their services and tapping into new markets. The bank is now also focusing on the development of a Bond Agency, managing the issuing of bonds and their registration on the Dutch Caribbean Stock Exchange. Leo Rigaud, Managing Director of Vidanova Bank proudly notes, “That is a new product, and up to now we are the only bank that has issued such a bond.” Additionally, the bank is also committed to the continuation of development as an arranger of Consortium Financing, together with Vidanova Pension Fund.

With all the new products and services that the two companies have in the pipelines, they are actively reaching out to their customers to effectively communicate the many benefits to be gained from this partnership. They also will be rolling out a new marketing strategy geared towards the public in an effort to expand their customer base. And in anticipation of the many new large projects on the island that are either in the planning stages or already underway, the long-term strategy is to also focus on these emerging markets.

Yet in spite of their potential growth trajectory, Vidanova Bank intends to stick to its roots and continue as a ‘Boutique Bank’ with high quality and more personalized customer service, and the opportunity for clients to contribute to the profit of their own pension fund through the use of the company’s banking services. When a customer banks with Vidanova Bank they create added value and profit for the company and that will translate itself into investing in their own pension. This is what makes the collaboration between Vidanova Pension Fund and Vidanova Bank such a unique synergy and a perfect fit. Indeed, with the collaboration of the two companies, together they emerge as a bigger player in the local market, enabling them to compete with other large financial institutions. As Mr. Rigaud notes, “That is for us, one of the biggest advantages of being acquired by Vidanova.” Ms. Alberto chimes in by adding, “We have formed our own consortium.”