Financial Services Industry Insights

Financial
Services
Industry
Insights
In this issue:

Banking
- Clauses leading to changes of costs
in loan agreements
- “Tax gross-up” clauses under
cross-border loan agreements
Romanian law specifics

Insurance
- New AML/CFT regulation

International and domestic recent
FSI regulatory developments.

Financial Services Industry, March 2009

Clauses leading to changes of costs
in loan agreements

Introduction Types of clauses

The fair concern of the borrowers in any The market disruption clause;
finance transaction ‟ the costs ‟ becomes The mandatory costs clause;
increasingly critical in current times when The increased costs clause.
banks,
facing significant increases of their funding Market disruption
costs, are tempted to
transfer such additional costs to the In certain credit agreements the banks have
borrowers. the contractual right to increase the interest
rates to align them to the market conditions.
The material herein presents several types of In other cases, where the banks’ right to
clauses of credit unilaterally change the interest rate is not
agreements which may trigger additional or discretionary under the contract, the banks
increased costs for the borrowers, without are protected through the clause known as
however aiming to analyze the validity the “market disruption clause”.
thereof. It is worth mentioning that such
This type of clause is specific for financings
clauses have been developed for
structured on the cost ‟ plus basis (with the
corporate loans and the applicability thereof
interest rate based on EURIBOR/LIBOR) where
for retail loans should be further investigated,
the interest is computed as EURIBOR/LIBOR
including from the perspective of the
rate for a certain currency and time period,
consumer protection legislation.
plus the margin, i.e. the bank’s profit; also,
any other additional costs related to the
financing are transferred to the borrower.

Financial Services Industry Insights

The reasoning behind the use of this type of The second situation covered by the clause
clause is allocation of risks: namely, a bank is protects the banks when differences appear
assumed to fund itself from short term between EURIBOR/LIBOR and the actual
deposits in the interbank market. The interest funding costs.
paid for such deposits (EURIBOR/LIBOR)
represents its funding costs and the “plus” is Until the 90’s, the market disruption clause
the margin ‟ the bank’s profit from the covered only the case of absence of
transaction. This is the context where the quotations. During that period, Japanese
bank wishes to protect itself by transferring banks were granting loans based on LIBOR
to the borrower the risks which may affect plus margin. As Japanese banks’ rating
the profit rate corresponding to that decreased, their actual funding costs grew
transaction. substantially and the LIBOR rate was no
longer representative. In the absence of the
The market disruption clause is standard in second case regulated by the market
the finance documents for syndicated loans disruption clause, the Japanese banks did not
issued by the Loan Market Association (LMA) have the possibility to transfer the additional
and has also been adopted in the finance funding costs to the borrowers and ended up
documents of many Romanian banks. The having to sell their credit portfolios, in certain
clause becomes operative in two cases: when cases with significant losses.
the quotations for EURIBOR/LIBOR are not
available or when the financing costs for the The market disruption clause in the context
lender (or, in case of syndicated loans, for a of the global financial crisis
certain percentage of the banks in the
syndicate) are increased, case where it allows Currently, in the context of turbulences on
the lender to increase the interest rate when the international financial markets and the
its financing costs are in excess of liquidity crisis, banks, facing real increases of
EURIBOR/LIBOR. The interest increased in their funding costs, turn to this clause. In the
such manner shall reflect and cover the UK, the British Bankers’ Association (BBA), in
lender’s actual costs of funds. response to recent reports according to
which more and more banks turn to the
History market disruption clause, issued a press
release stating that the application of such
Historically, the clause appeared due to the clause should be a last resort and only after
fact that the banks often grant loans in certain measures have been undertaken. BBA
foreign currencies ‟ without having domestic considers that this clause should only operate
financing resources for such currencies ‟ and when the banks face real difficulties in
at rates which are entirely linked to the obtaining funds or if the interests payable for
functioning of the interbank market. The the interbank deposits are substantially
clause appeared in the 60’s ‟ 70’s in the higher than EURIBOR/LIBOR.
context of the concerns regarding the
potential freezing of the financings in US
dollars in the European markets ‟ hence the
first situation regulated by the clause: the
absence of quotations.

Nevertheless, according to BBA, Increased costs
EURIBOR/LIBOR rates should reflect, even in
current conditions, the average funding costs The increased costs clause comes to protect
for the panel banks. Renouncing to the the bank against the risk of introducing or
transparent system of calculating interest amending legal or regulatory provisions (or of
rates based on these indicators and changes in the application or interpretation
determining interest solely based on the thereof) which may affect the bank’s profit in
individual funding costs of each bank, would a specific transaction or which are capable of
lead interest calculation to become difficult triggering certain additional costs for the
and opaque. In addition, this would deprive bank.
the borrower of the possibility to challenge
such computations or to request its lender to Borrower’s remedies
document such additional costs (if such rights
have not been contractually granted to the The LMA type agreements or those inspired
borrower). by the LMA create, however, a certain level
According to the Association of Corporate of protection for the borrowers. For example,
Treasures (ACT), it is essential that the in case a market disruption event appears,
reasons why the indicators do not reflect the the LMA standard agreement provides the
market conditions are investigated prior the possibility, upon request of any of the
banks using this as a reason for abandoning parties, to enter into negotiations (usually for
the standard method of computing the a limited period of time) for determining an
interest based on EURIBOR/LIBOR. alternative method for calculating interest.
Furthermre, in such a case, as well as in other
Other clauses imposing additional costs situations where the bank intends to apply
to the borrower in a loan agreement increased costs, the borrower is allowed to
early repay the debt (without prepayment
The market disruption clause is however not costs).
the only clause in a loan agreement able to
trigger additional costs for the borrowers. In However, the additional costs imposed
addition to the bank’s commissions, the through the above mentioned clauses are
transaction costs or early repayment fees, the owed by the borrower until repayment takes
LMA - type agreements contain clauses that place. In addition, in the case (very likely)
transfer to the borrower the regulatory costs: where the reimbursement takes place
capital adequacy or costs of establishing the through refinancing, this triggers additional
minimum mandatory reserves by the banks time and costs for the borrower and the
(„mandatory costs” and “increased costs” margin of the refinancing facility is likely to
clauses). be higher than the one in the refinanced
loan.
Mandatory costs

The mandatory costs clause covers the Author:
transfer to the borrower of all existing
regulatory costs, such as the costs related to Simina Mut - Senior Associate in
establishing minimum mandatory reserves Reff & Associates SCA, the correspondent
usually payable to the regulatory authorities. law firm of Deloitte Romania.


“Tax gross-up” clauses under cross-
border loan agreements – Romanian
law specifics
It is a well known fact that any loan involves A cross-border loan agreement usually
the disbursement of a sum by a lender (or a contains a clause which (in the absence of a
number of lenders in case of syndicated loans withholding tax exemption applying) requires
/ club loans) to a borrower, with the the Romanian borrower to pay an additional
obligation for the later to repay the borrowed amount so that the amount of interest paid
amount (known as principal) plus an interest to the foreign lender effectively is the same
(additional fees are usually also applicable). as if there was no withholding tax. Actually,
On this basis the lenders all over the world under such “gross-up” clauses, the
have developed standardized Romanian borrower undertakes to pay to the
documentations for loans, assignments and foreign lender the equivalent of a before-tax
participations. Additionally, a substantial amount of interest, in spite of the fact that,
literature has been developed in this respect under the law, the foreign lender is the one
(notably such doctrine is mostly availably liable for the tax. While cross-border loan
internationally, while only very limited is agreements will usually include a “tax gross-
available on Romanian law). up” clause, in local loan agreements (i.e.,
where both the lender and the borrower are
While at an international level, such located in the same tax jurisdiction) such
standardized documents have been clause is sometimes missing (i.e., as the
developed and adapted so as to suit the lender does not see the purpose of such
particularities of the various interconnected clause in the first instance). However, such
implications (regulatory, accounting, tax, etc), omission may fire back in cases where local
using them now in jurisdictions which loans are to be subsequently assigned to a
historically did not pursue the same steps, foreign third party (e.g., a financial
might be challenging both for the lenders institution located in a different tax
and the borrowers. For instance, the jurisdiction).
contractual regulation of some tax In cases where the loan agreement is silent
obligations in the loan documentation might on this matter (i.e., no “gross-up” clause),
pose significant issues mainly due to the fact then the application of withholding tax will
that the realities of the international practices most probably occur, reducing thus the
have taken ahead the local Romanian fiscal effective net amounts which a foreign
framework. purchaser would prefer to receive from the
borrower under the loan. In such cases, in
For example, the “tax gross-up” clauses order to assess the correct tax regime, one
provided in most of the international loan should look into the applicability of the
relevant Convention for the avoidance of
documentation is such a specific case where
double taxation (if any), as well as into any
the commercial reality is one step ahead to
other tax laws, regulations and rulings issued
the fiscal regulations which should offer the
by the relevant tax authorities, as applicable.
grounds for assessing the fiscal impact of the
transaction.

Whereas the “tax gross-up” clauses has been Going further, the foreign lender could claim
essentially designed to ensure certainty of the the provisions of a convention for the
lenders in respect of the amounts to be avoidance of double taxation
received from the borrowers, in many (“Convention”), if such convention is
jurisdictions the appropriate fiscal mechanism concluded between Romania and the country
to implement it has been put in place. The of residence of that lender. Commonly, such
tax issues raised currently at an international conventions reduce the withholding tax rate
level by the use of the “tax gross-up clauses” with several percentages but there are
are more sophisticated and focus more on conventions which also bring the taxpayers to
keeping abreast the variances of the loan a nil withholding tax due on interest
documentation and the interpretations rising payments.
therein.
“Tax gross-up” clauses – option 1
In Romania however, there is a strong need
to first reach an Let us now take for example a simple type of
understanding of this clause and the impact “tax gross-up” clause, whereby the loan
is has: agreement concluded between a foreign
„ first from a tax standpoint at the lender and a Romanian borrower, provides
level of the lenders and of the borrowers, but only that if any withholding tax shall be
also applicable to the payments due by the
„ from an economic perspective, if borrower to the lender, such withholding tax
such uncertainties would impair lending will be paid by the borrower.
activities and potentially lead to a blockage.
In these conditions, the Romanian borrower
should gross the 100€ interest payable to the
Lack of a “tax gross-up” clause
foreign lender with such an amount that on
Normally, for a 100€ interest revenue derived one hand, the tax authorities are not
from Romania, a foreign lender would be deprived by an accurate amount of tax, and
liable to have that income taxed in Romania on the other hand, the foreign lender
at a withholding tax rate as provided for in receives all 100€ interest in one stage only.
the applicable Convention (assuming one is As most of those involved in this type of
in place and the conditions for its activities know already, the polemics around
applicability are met) or the local rate This is the gross-up mechanism arise in respect of
done via withholding to be performed by the the tax rate applicable when computing the
Romanian borrower, which is liable in this tax. Specifically, the big question is: should
respect towards Romanian authorities. you apply only the domestic tax rate or could
Specifically, the borrower should withhold you claim the provisions of the Convention
16€ representing interest withholding tax for the avoidance of double taxation?
due by the foreign lender (assuming a 16%
rate applicable) and wire the money to the It is relevant to say that the Romanian tax
Romanian tax authorities, while the laws state that the domestic tax provisions
remaining 84€ would reach the foreign are applicable in case the “tax due by a non-
lender’s pocket. resident is payable by the income payer”.


The rationale behind this provision is that Even more, the Fiscal Code is explicitly stating
once the Romanian borrower chooses to bear that in case any of its provisions would
the tax otherwise normally due by the contradict an international treaty to which
foreign lender, the subject of taxation is Romania is a party, the respective treaty shall
switched from a non-resident to a resident, prevail.
therefore the grounds for claiming the
provisions of a Convention no longer exist On the other hand, it is also relevant to
since there is no “double taxation” involved mention a court precedent (i.e., Decision no.
in the first place anyway. Under this 4111 from 22nd of November 2006 of the
rationale, the Romanian borrower, instead of Romanian High Court of Justice) whereby,
being a mere “collection vehicle” for the tax among others, the court supported the
due by a non resident, becomes a regular interpretation of certain specific fiscal
resident taxpayer for that tax, thus subject provisions under the local legislation in the
only to the Romanian tax provisions while the sense that, given the existence of contractual
foreign is discharged by its Romanian tax provision stipulating the Romanian payer as
obligations. bearer of the burden of payment of any
withholding tax, the double tax treaty
Furthermore, the tax born by the Romanian existing in place between Romania and the
borrower on behalf of the lender shall be creditor’s tax jurisdiction cannot be invoked,
disallowed for deductibility for corporate and therefore local withholding tax should
income tax purposes, incurring thus a cost. apply. While Romanian law is not a
precedent based system, it is recommendable
It has been argued that the above Romanian that the existence of relevant precedents (in
tax law provisions and the consequent particular when resolved at the level of the
rationale, may contradict constitutional High Court) be considered when interpreting
provisions, specifically those that the arguable legal provisions.
domestic legislative provisions cannot prevail
over those included in international treaties Notwithstanding the above, in a case where
concluded by the Romanian state with other the agreement includes such gross-up clause
countries. However, the Romanian but the lender still wants to apply the
Constitution provides for such prevalence of Convention, one should consider whether
international treaties over local law only in this approach might not actually lead to an
respect of international treaties concerning avoidance of tax rather than to the avoidance
human rights and EU constitutive treaties or of a double taxation. Thus, while the foreign
other EU mandatory legislation. In our lender has negotiated a clear neutral position
opinion, a stronger argument challenging the with respect to the taxes due in Romania by
applicability of the above mentioned tax law discharging its obligations towards the
provisions comes from the Fiscal Code itself Romanian borrower, if it would receive from
which, under the section dedicated to the the Romanian borrower the proof that tax
application of the Fiscal Code versus existing has been withheld and paid in Romania for
Conventions, provides for the applicability of the respective interest, the foreign lender
a Convention whenever it is in place and the could theoretically benefit of a fiscal credit in
conditions for its applicability are met. its own tax jurisdiction for a tax that was
actually born by somebody else. Although
this may seem as an extreme case (and could
be viewed as a matter of bad faith), it might
not be very easy for the tax authorities to
identify such situations.

“Tax gross-up” clauses – option 2 Conclusion

Another drafting option is to provide in the The most often used forms of contractual
loan agreement that if any withholding tax drafting for “gross ‟ up” clauses have been
applies, then the amounts payable by the outlined above. Importantly, variations to
borrower shall be increased with such these may and sometimes are strongly
amount necessary, so that the net amount to recommended to be considered. There are
be paid to the lender (i.e., upon applying the also other matters of relevance in relation to
withholding tax) be the same as if no “gross-up” clauses (e.g., applicability of such
withholding tax would have applied in the clauses in case of multi-lender structures,
first instance. Under this option, depending differentiation between original lenders and
subsequent lenders, duties of the parties in
significantly also on the actual wording used
providing documents needed for invoking
in the loan agreement, one could argue that
double tax treaties, etc.), which are
the borrower may be seen as paying a
addressed on a case by case basis when
variable interest rate rather than merely
drafting the loan documentation and which
paying the withholding tax on behalf of the
may trigger additional tax implications.
lender.
The polemics around the tax rate applicable
If, again ‟ depending on the actual wording
under a “gross-up” mechanism are still
in the agreement, such qualification would
strong and the reality is that, in our view, the
correctly interpret the will of the parties, such
problem of the gross-up mechanism has not
variable interest should be evidenced as such
been approached by taking into account all
in the books of the borrower, and in fact,
the factors surrounding the issue, as
also in those of the lender. But under a
presented above. It appears that the
cross-border transaction the means of the
legislator has taken the easiest path to solve
authorities to check the records of the
its immediate problem (i.e., imposing and
foreign lender may be limited and raise
collecting a tax over the Romanian source
cumbersome issues including significant
income) and left out the other factors,
resources (time, money and personnel), and
external to taxation, thus missing the big
could be a matter that the authorities may
picture called the development of the
further consider and regulate. Also, it is
economy, under which taxation is only one of
debatable, to say the least, whether such an
the factors involved (a very important one
approach would be convenient to the foreign
though).
lenders.

The development of the financial sector
This second manner of drafting the gross-up
depends not only on an accurate banking
clause seems to be superior to the first
legislation, but also on other factors such as
option1, yet it should be noted that given the
taxation of financial operations. Foreign
ultimate effect, which is quite similar with the
lenders and Romanian borrowers are entitled
one of the first option above (i.e., one way or
to a sound fiscal environment which does not
another the borrower bears the withholding
impair them in conducting their operations,
tax due by the lender), there is still a
offering them certainty in respect of taxation
significant risk that the Romanian fiscal
as well as the proper fiscal mechanisms to
authorities / courts see such clause as having
cope with the tax requirements.
the same purpose.

1
This is also in line with the standards recommended by the Loan Market
Association (“LMA”)


Notably, the Romanian borrowers and the Optimal from the perspective of a fair tax
foreign lenders have now the means to treatment but also from a wider economic
interrogate the tax authorities directly and perspective, i.e., that of allowing the lending
clarify their specific tax matters arising from activities to develop properly, without
the “gross-up” clauses included in their loan hindrances and barriers “imposed” by the
agreements by applying for an individual tax local tax framework.
binding ruling. If the parties would take this
path, the tax authorities would need to deal
with this matters concretely and due to the Authors:
multitudes of possible situations arising from
the application of the various tax gross-up Raluca Cojocaru ‟ Manager in Deloitte Tax
clauses, the legislator may need to adjust the
tax frame work accordingly so that the Andrei Burz Pinzaru ‟ Senior Manager in
optimal solution is found. Reff & Associates SCA, the correspondent
law firm of Deloitte Romania.

Insurance: new AML/CFT regulation

The Insurance Supervision Commission (CSA) Insurance companies should apply three
has recently undertaken a broad initiative to levels of customer due diligences (standard,
overhaul the regulatory framework dealing simplified and enhanced), will need to
with anti-money laundering and combating perform a risk assessment in relation to their
the financing of terrorism (AML/CFT). The lines of business and will need to risk rate
new regulation, Order no. 24/2008 amends their clients and monitor their activities.
the law to both reflect the Third EU AML
Directive and address the recommendations In practice, insurers must:
of the Third Round AML/CFT Report on
Romania1 of Moneyva2.  review their internal AML/CFT policies
and procedures and amend them to
The new norms are substantially different incorporate the new regulation;
from the previous ones, introducing further  analyze their AML/CFT company risks;
obligations both for private companies and  develop a new mechanism to determine,
for the supervisory authority. It introduces verify and register the identity of clients
new requirements including those relating to and real beneficiaries or adjust the
politically exposed persons, beneficial owner existing one as appropriate;
and a risk-based approach to the detection  monitor the activity of their clients in
and prevention of money laundering and order to ensure the proper risk
terrorist financing. classification.

A. Companies’ obligations The new regulation contains several
indicators in order to assist in identifying
Insurance companies must draft policies, suspicious transactions. Nevertheless it
procedures and appropriate mechanisms in should be borne in mind that the indicators
terms of KYC, risk assessment and risk listed are only examples and should be
management, internal control, reporting and supplemented by other guidance available
records storage to prevent and stop their and relevant industry and company
involvement in money laundering and experience.
terrorist financing.

The mechanisms should allow for the
identification of suspicious transactions based
on risk indicators, applying appropriate
measures for different categories of
customers, products, services, operations and
transactions.

1
Adopted by the Moneyval Plenary in July 2008.
2
The Council of Europe Select Committee of Experts on the Evaluation of
Anti-Money Laundering Measures


B. Insurance Supervisory Commission’s Deadlines
obligations
The new regulation entered into force at the
The new norms enhance and detail the role beginning of this year and sets up strict
of CSA in the AML/CFT field. In this respect, deadlines for insurance companies, for:
CSA shall:
 adopting internal procedures;
 supervise and control the companies  appointing a designated person to be
operating in the insurance market, to responsible for implementation and
ensure that they comply with the new compliance with laws and regulations in
legal provision on identification, force;
verification and registration of clients  notifying the CSA of the above.
and transactions, reporting and record
keeping; The regulatory obligations of insurance
 verify the AML/CFT policies and/or companies carry sanctions for non-
internal procedures of the insurance compliance. Obviously, these are in addition
companies; to the reputational risk associated with
 require amendments of the policies money laundering and terrorist financing.
and/or internal procedures when found
not reflect prudential measures
stipulated in the new rules. Authors:

Paula Lavric ‟ Manager, Forensic & Dispute
Services

Catalina Stroe ‟ Senior Consultant,
Forensic & Dispute Services

International and domestic recent
FSI regulatory developments
A. International B. Domestic

I. Regulations/Decisions I. Regulations/Decisions
1. Commission Regulation no. 1261/2008 1. National Bank of Romania’s Order no.
of 16 December 2008 amending 13/2008 for the approval of the
Regulation no. 1126/2008 adopting accounting Regulations compliant with
certain international accounting the European Directives, applicable to
standards in accordance with Regulation credit institutions, non banking financial
(EC) no. 1606/2002 of the European institutions and the deposit guaranty
Parliament and of the Council as regards fond in the banking system.
International Financial Reporting 2. National Bank of Romania’s Order no.
Standards (IFRS) 14/2008 for the approval of the
2. Decision of the European Central Bank reporting forms comprising the
of 17 November 2008 laying down the statistical information of accounting -
framework for joint Eurosystem financial nature and the methodological
procurement. norms regarding their drafting and
3. Decision of the European Parliament and utilization applicable to the Romanian
of the Council of 19 November 2008 on branches of other EU credit institutions
the mobilization of the European 3. National Bank of Romania’s Regulation
Globalization Adjustment Fund in no. 1/2009 amending National Bank of
accordance with point 28 of the Inter Romania’s Regulation no. 11/2007 on
institutional Agreement of 17 May 2006 the authorization of Romanian credit
between the European Parliament, the institutions and Romanian branches of
Council and the Commission on non ‟ EU credit institutions.
budgetary discipline and sound financial 4. National Bank of Romania’s Regulation
management. no. 2/2009 amending National Bank of
II. Proposed Regulations Romania’s Regulation no. 3/2007 on
1. Proposal for a Regulation of the limiting credit risk as regards loans for
European Parliament and of the Council individuals.
of November 12, 2008 regarding Credit 5. National Bank of Romania’s Norm no.
Rating Agencies 1/2009 amending National Bank of
2. Opinion of the European Central Bank Romania’s Norm no. 6/2008 on
of 18 November 2008 at the request of amending National Bank of Romania’s
the Council of the European Union on a Norm no. 7/1994 on the trade
proposal for a Directive of the European performed by credit institutions with
Parliament and of the Council amending checks.
Directive 94/19/EC on deposit- 6. National Bank of Romania’s Norm no.
guarantee schemes as regards the 2/2009 amending National Bank of
coverage level and the payout delay. Romania’s Norm no. 7/2008 amending
3. Proposal for a Decision of the European National Bank of Romania’s Norm no.
Parliament and of the Council of January 6/1994 on the trade performed by credit
23, 2009, establishing a Community institutions with bills of exchange and
programme to support specific activities promissory notes.
in the field of financial services, financial II. Proposed Regulations
reporting and auditing 1. National Bank of Romania’s Regulation
regarding the internal administration of
activity, the internal process of
evaluation of capital adequacy to risks
and the outsourcing of activities of the
credit institutions.
2.

Reorganisation services for financial
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Restructuring
We are able to provide hands on support for
companies undertaking financial
restructuring under the pressure of a financial
crisis. This support extends beyond designing Contact
plans to their implementation and the Hein van Dam ‟ Financial Advisory Partner
negotiation of terms with creditors and other tel: + 40 (21) 207 52 30
stakeholders affected by the restructuring e-mail: hvandam@deloittece.com
plan.

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Chairman
tel: + 40 (21) 207 52 55
e-mail: gmucibabici@deloittece.com

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tel: + 40 (21) 207 52 31 exposures, etc)
e-mail: rsegarceanu@deloittece.com  Corporate tax assessment and structure tax efficiently significant
transactions, such as mergers and spin-offs, IPOs, etc.
 Assistance during tax authorities’ inspections and assistance in
obtaining individual binding rulings
 VAT tailored solutions applicable to financial institutions with focus on
streamlining the VAT deduction right on acquisitions as well as correct
assessment of VAT treatment of financial services


Legal  Finance law: legal assistance on loan and security documentation, loan
Andrei Burz-Pinzaru restructuring and non-performing loans, transfer of loan portfolios, title
Senior Manager, Reff&Associates check on assets used as collateral
correspondent law firm of Deloitte Romania  Regulatory and compliance assistance for banks and non-banking
tel: + 40 (21) 207 52 05 financial institutions, insurance companies, securities firms, asset
e-mail: aburzpinzaru@deloittece.com management companies
 Securities law: legal assistance on listing/ de-listing procedures, public
offerings, insider trading, price stabilization, share buy-backs, stock
option plans
 M & A assistance in financial services industry: due diligence and
transaction support

Consulting  Operational effectiveness: Enterprise Cost Reduction, Organizational
Martin Stepanek redesign / review, Process reengineering, Benchmarking analysis, IT
Manager system’s selection / development, Activity Based Costing.
tel: + 40 (21) 207 53 60  Support for increasing sales and market entry: Strategy development,
e-mail: mstepanek@deloittece.com Strategy development for distribution channels, Support for sales force
network redesign aimed at professionalization and sales increase,
Design and implementation of sales management system
encompassing recruitment, training, talent management and
development of the sales force, Developing compensation and
motivation systems for sales force, Branches / sales outlets design, New
(direct) sales channel’s organization design and development.
 Support for bancassurance operations: Strategy for bancassurance,
Support in choosing bancassurance model, Developing product
portfolio, Operational excellence for bancassurance, Support in setting
up new insurance companies, Designing new sales and customer
service processes, IT support.
 Support for CFO: Finance organisation design, Finance systems
strategy, Target operating model, Budgeting and forecasting, Enhance
business analysis, Accounting and reconciliation remediation,
Centralization of accounting processes, Accelerating and improving
financial close, Treasury and cash management.

Actuarial & Insurance  Cash Flows projections and value based management (profit testing,
Solutions business planning, Embedded Value calculations and reviews);
Slawomir Latusek  Risks and Liabilities assessment (Risk and capital management, life and
Consultant non-life provision valuations);
tel: + 48 (22) 511 04 54  Actuarial audit support (review of life and non-life reserving
e-mail: slatusek@deloittece.com methodologies);
 Calculation of pensions and other benefits;
 Actuarial trainings (IFRS 4, Prophet, Cross, Remetrica, CROS, Glean,
ReMetrica, Dynamic Financial Analysis according to Market Consistent
Embedded Value and Solvency II requirements);
 Predictive modelling (with application in insurance, banking and
Human Resources).

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