International Treasury & Cash Management (Intermediate)

Overview and introduction to international treasury

• The main elements of treasury management
• Evolution and the changing role of the corporate treasurer
• Policy and strategy
• Changing face of treasury process – automation, control and STP
• The importance of cash and liquidity management

Business models and treasury organisation

• Underlying business models – organisation, integration and culture
• Finance models – decentralised, shared services and commissionaire
• Impact of business model on treasury structure ;decentralised, regional and centralised treasury
• Allocation of treasury responsibilities
• Treasury models
• In-house banking

Treasury as a business service provider

• The product portfolio of an in-house bank
• Funding and investment
• FX centre
• In-house banking and cash managementNetting centre
• Payment factory
• Location considerations

Exercise

Clearing and settlement systems for domestic money movement

• Types of settlement systems and how they work domestically – net settlement; real-time gross settlement; bilateral systems; continuous linked settlement
• Types of clearing: High value, Low value clearing (ACH), cheque clearing
• Comparing different environments
• Associated data transmissio
• Evolution

International money movement

• International banking principals and challenges
• Understanding SWIFT, the types of messages and when they are used
• Cross-border payments – Globally; Eurozone payment and clearing options
• Corporate options – Using correspondent or partner banks; using network banks for international money movement
• Straight-through processing and barriers to STP

Related payments and collection services

• Check and draft collections
• Branch deposits and virtual accounts (incl. notes and coin)
• Documentary collections and letters of credit
• Cards – T&E; procurement; stored value
• Web and mobile payment approaches

Exercise: International money movement

Social Drinks Reception

An informal social drinks reception will take place near the venue for those participants wishing to network with other participants also to obtain one-on-one practical advice from the tutor.

Settling transactions within a multinational group

• Types of intercompany settlement – third party, bi-lateral, multilateral and clearing house
  o Trade payments and receivables
  o Financial flows
• Corporate business structure drivers of netting
• Structural issues
• Policy issues and netting methods
• Practical problems that may be encountered (e.g. regulatory issues)
• Netting review checklist
  o Cost efficiencies
  o Potential providers
• Evolution and new approaches to netting

Exercise: Setting up a netting system

Cost impacts, bank pricing and use of currency bank accounts

• Why use currency accounts and where to locate them
• Managing currency accounts (reporting, funding, defunding)
• How banks price and impact on corporate cost (float, earnings credit, overt and covert) fees
• Impact of value dating on international money movement; Europe and the PSD
• Resident and non-resident issues – importance of establishing correct ownership
• Understanding value dating

Liquidity management: Part 1 – concentration and pooling in one currency

• Cash concentration and similar services
• Types of pooling – physical; notional etc
• Tax and regulatory issues
• Documentation
• Interest and how it is allocated
• Cross-border rules and impact in cash concentration
• Bank capabilities
• Multi-bank concentration
• Money market investment

Liquidity management: Part 2 – concentration and pooling in multiple currencies

• Traditional approaches to intercompany funding
• Limitations of traditional approach
• Synthesising an exchange rate
• Interest compensation approach
• Transparency and understanding the savings
• Bank capabilities and use of correspondents

Putting it all together: Creating efficient account structures

• Determining the most efficient account structures
• Easy countries and problem countries – examining different scenarios
• Impact of PSD on European account structures
• Adding sophistication of models for operational purposes
• Structures that combine operational efficiency and liquidity management optimisation
• Ownership issues and effect

Exercise – Liquidity structure comparison

Current trends in treasury and banking

• Cybercrime, fraud and security
• Best practices in cash management
• Regulatory impact
• The increased importance of corporate treasury

Shared services: Initiatives, centres and payment factories

• Differing approaches
• Technology Platforms
• Impacts on treasury and the appropriate response
• Account structures
• Choice of banks
• Implementation and customer service requirements

Global payment technology

• Mechanization in treasury departments
• Balance and transaction reporting
• Payment channels – moving from paper transactions to electronic; impact of e-business and new payment channels
• Multiple banking formats in business systems
• Multi banking and the role of SWIFT
• Transaction detail
• Corporate needs and bank challenges

Exercise – Integration of commercial and Treasury transaction platforms

Bank relationship management

• Objectives of BRM
• Relationship vs. transactional banking
• Role of credit
• Measurement and feedback
• Common points of failure
• Rewarding the effective
• Relationship meetings

Selecting cash management banks to fulfill different roles

• Approaches to bank selection
• How the process of bank selection works
• Selection for domestic, pan regional and global purposes
• Bank geographic strategies
• Importance of matching Corporate organisation
• Local or regional banks?
• What multinational corporates are looking for
• Approaches to pricing and service quality
• Understanding what constitutes ‘best’

International bank RFPs

• Process checklist – what should your expectations be?
• Pricing and costs
• Using different techniques
• Identifying and pre-qualifying banks
• The tender document – what to include
• How to evaluate the bank responses
• Due diligence

Exercise – what to include in bank RFPs