Finverity, a mid-market supply chain finance platform with a focus on emerging markets, has appointed Brett Downes as its Chief Risk Officer.
At Finverity, Downes will be in charge of overseeing the risk function, enhancing the risk management processes and contributing to the development of the platform’s risk functionality, putting his vast experience of trade and supply chain finance into action. The appointment comes at a time when growing investor interest in the attractive investment features of supply chain finance combined with Finverity’s robust and scalable processing technology platform are propelling Finverity to enter a growth phase in its development and expand its senior team. Downes will report directly to Finverity’s CEO and chair the Credit Committee.
Downes is the second senior hire following the appointment of Alex Collingwood as Head of Sales & Origination in July 2021, who brought with him a 35 year track record in trade and supply chain finance. Downes brings over 25 years’ experience in corporate, and structured finance banking, of which the latter 10 was in trade finance and working capital solutions at leading banks and financial institutions. Brett began his banking career in 1995 at National Bank of Australia working in various corporate origination roles, eventually becoming an integral part of the Project and Structured Finance origination team. In 2004 he moved to Citibank Australia to lead the corporate and investment bank credit teams. In 2007 he moved to the UK furthering his career in various senior credit roles at Barclays Wealth and Commerzbank, before taking the role of Director, EMEA Trade Credit Risk Manager at Citibank London in 2010. In his second period at Citibank, he was instrumental in building the commodity trade finance business.
In 2015, Downes joined Greensill Capital as Chief Risk Officer, where he was tasked with building the risk function, eventually scaling it to over 70-plus risk professionals. He was responsible for creating and implementing the risk management processes and policies from scratch. In May 2020 Brett was asked by the Greensill board to take sabbatical leave until 2021. During his sabbatical, the Greensill Capital board appointed the Deputy CRO to the full-time CRO role, with Downes being promoted to a passive Vice Chairman role. Less than a year later, in March 2021, Greensill was placed into administration. Brett has been retained by the administrators to assist maximising recoveries on behalf of investors and stakeholders.
Alex Fenechiu, COO & Co-Founder, Finverity, says: “Sometimes doing the right thing and identifying red flags leads to people being cast aside. Finverity sees Brett’s experience as invaluable to our mission. In order to build a reliable and efficient infrastructure to invest in SCF, it is essential that we fully understand and address what can go wrong. Brett’s knowledge and insight makes him ideal in this regard. We are delighted to welcome Brett as we continue to lead the way in innovating the SCF industry, to allow participation in the space efficiently, reliably and transparently for all stakeholders.”
The trading and financing of invoices is a centuries old practice that has been an integral part of trade finance from medieval European commerce to the expansion of the trading empire. Done correctly, supply chain finance improves working capital for both buyers and suppliers, currently attracting increased investor inflows driven by stable and attractive yield generation in the world where yield is scarce. Done incorrectly and without the proper checks and controls in place, its risk profile increases, as would be the case with any investment strategy and as underlined in Greensill’s case. The 2019 Trade Finance Report by the International Chamber of Commerce (ICC), shows that trade finance products exhibit low global default rates, with a particular emphasis in the report being placed on supply chain finance, which shows the lowest global default rates outside Letters of Credit, at only 0.11% in 2017 and 0.13 per cent in 2018. In recent years, a number of specialist, non-bank investor groups in SCF have grown to satisfy increased investor interest in alternative asset classes and now account for the 20 percent of the market not controlled by big banks, according to Oliver Wyman.
Brett Downes, Chief Risk Officer, Finverity, says: “In general, portfolio concentration, poor corporate governance, and weak investor distribution models can be terminal for businesses in the financial sector. However, the lack of a robust, real-time technology platform is an often-overlooked crucial factor in Greensill’s demise. If Greensill had had a technology platform like Finverity’s in place, the Greensill story may have been very different”.
Brett Downes, Chief Risk Officer, Finverity, adds: “A successful risk management culture needs to be embedded in the governance processes of a company and can never be the sole responsibility of the CRO. At Finverity I will have the required level of autonomy to manage the risk function without undue interference, this being one of my key reasons for joining Finverity. I strongly believe that together with the team at Finverity we will create an ecosystem where SCF will become what it deserves to be: a truly investable and accessible asset class”.
Viacheslav Oganezov, CEO and Co-founder, Finverity, says: “Technology has a fundamental and too often overlooked role to play when it comes to investing in SCF or for that matter into any operationally heavy asset class. Yet, the risk function needs to be built on both tech and human input. We are building Finverity not only based on superb systems but also on a smart and experienced team ingrained in a culture of sustainable growth and transparency. When any of these factors are not given the required attention, results will slip. Brett’s extensive experience will add significant value to Finverity, as we continue to develop our SCF platform and scale the business. Learning from mistakes is the only way to evolve, and we’re delighted to welcome Brett on board at this exciting time in Finverity’s growth”.
