AON Romania, one of the global leaders in insurance broker market, organized on Wednesday, May 10, the online conference “Commercial Lending. Reality vs. Image”. Among the speakers were Eugen Anicescu, CEO of AON Romania, Florin Ilie, Deputy CEO and Head of Wholesale Banking ING Romania, and Alexandru Popescu, CO-founder FinLight Project, respectively Elena Nuță, Trade Credit Practice Leader, AON Romania.
The macroeconomic evolution and monetary policy of governments, the impact of the successive crises of recent years in the context of the geopolitical conflict, as well as the ability of companies to adapt with the right tools to the dynamics that have become the new business norm were the main topics of discussion of the webinar.
“This is the first time that, although there has been a succession of overlapping crises in the last three years, we have not faced a growth crisis. We have faced the pandemic and the related closure of economies, the crisis of logistics chains, and the war in Ukraine, which led to an energy crisis, but even if the economy seems to have preserved its resilience, we are settling with inflation generated by excessive liquidity”, said Eugen Anicescu, CEO of AON Romania, during the webinar.
The challenges that economies face now will have effects for years to come. Inflation, geopolitical developments, tensions between the US and China, respectively the change in energy policies remain the main risks to economies and lead to a hard-to-predict context.
“The percentage of insolvencies remained low until the end of 2022, with collection levels still good for most companies. However, we can anticipate increasing pressure on the profitability of companies as revenues start to slow down. However, cost elements have experienced a major increase in recent years and tend to remain high in the period ahead. We can expect companies will become more cautious or to restructure their operations in this context. At a regional and global level, the main players in the commercial credit insurance market forecast that in 2023 the number of insolvencies will increase, with percentages between 19% and 49%, returning to the pre-pandemic level, but the main segment that will be under pressure it will be that of small and medium-sized companies”, Eugen Anicescu also said.
During the event, Alexandru Popescu, co-founder of the financial reporting platform FinLight.ro, spoke about the concept of credit management.
“The credit management process is essentially simple. In implementing the process, the business reasoning of the company must be received. The available solutions cover a wide spectrum, from simple statistical analysis based on numbers, to solutions based on causality analysis between the analyzed company’s operations and the financial situation, taking into account the willingness to pay, the ability to pay, as well as the ability payment of the company. Carrying out a complete analysis, which is not limited to financial data, but also incorporates the evaluation of a company’s operations and decision-making process, will allow a supplier to differentiate itself and increase its sales and profitability”, said Alexandru Popescu, an expert with over 15 years of experience in the financial field.
For her part, Elena Nuță, Trade Credit Practice Leader within AON Romania, pointed out the expertise that AON has both at the global level, as the leader of the brokerage market in the commercial credit segment, and at the local level, mentioning the fact that within AON there is expertise for all types of businesses in Romania.
Even if macroeconomic indicators remain solid in Eastern Europe and Romania, the level of liquidity being good, an increase in insolvencies is anticipated as a return to normality. Thus, the attention paid to risk management should be increased, requiring preparation and practical solutions to counter potential turbulence.
“At AON, we are aware that in the coming period, the normalization of the business environment may put pressure on the level of risk and consequently on lending decisions. That is why we are trying to offer our partners in Romania innovative risk coverage solutions. The economy will continue to face multiple elements of stress. We must remember that most risk elements are beyond our control and, therefore, difficult to anticipate. Under these conditions, we are obliged to ensure that we have the tools to protect us”, concluded Eugen Anicescu, CEO of AON Romania.
Today’s webinar was the first of four online events that AON Romania will organize this year, the following three addressing topics from agriculture, property insurance, and employee benefits.