Effective immediately, the newly-named division will “better align services [that] add value to client needs”.
Andrew Fielding, national head of BDO’s Business Restructuring, said the move was more than just a name change, as it also signalled a shift in business approach "from 'How do we recover the bank or creditors’ money?' to 'How can we restructure the business for the benefit of all stakeholders?'"
To help the company transition to this new focus, BDO has appointed “bank whisperer” Peter Winterflood to its partner ranks and made former Suncorp restructuring executive Darren Stacey an executive director.
Mr Winterflood said the approach BDO Business Restructuring will now be taking has been shaped by his decades of experience in banking.
“Over the past couple of years there has been a clear shift in the way banks approach businesses that are experiencing financial distress,” he said.
“The emphasis has shifted away from making formal appointments to a more collaborative approach, whereby the banks try to work with the business to turn it around.
“Often, relationships between banks and the business clients break down simply because of a lack of understanding or insight into the respective critical issues … [so] having experience on both sides of the equation means we can act as a translator between the banks and their clients.”
Mr Winterflood added that the risk-grading process adopted by banks has become “far more sophisticated” since the global financial crisis, but that even though all banks have different risk models, they have the same end goal: “to determine the probability of default and the loss given default”.
He continued: “As a business’ risk profile deteriorates, the resultant risk grade dictates a higher capital cost for the bank.
“BDO Business Restructuring’s role is to work with businesses to improve their risk assessment, put them on a more stable footing and provide a wider range of financial alternatives.
“This creates a win-win situation for the banks and their clients. The banks get to reduce their capital costs and businesses have a chance to make proactive changes to their business operations to improve performance.”
Annie Kane is the editor of The Adviser and Mortgage Business.
As well as writing about the Australian broking industry, the mortgage market, financial regulation, fintechs and the wider lending landscape – Annie is also the host of the Elite Broker and In Focus podcasts and The Adviser Live webcasts.