How to explain what treasury is to family and friends?

| 09-08-2019 | by Pieter de Kiewit |

Your mortgage, credit card, holiday money and current account have business equivalents. They are managed by corporate treasurers. The title question, or variations, is one I have to answer quite often. Even more around the holidays, when I always meet my relatives. I am tweaking the answer constantly. Connecting private and business is my current strategy. Perhaps you (expert in the field or layman) can let me know if this explanation works for you.

You have a current, savings and perhaps other account. You pay the rent, groceries and a beer. You use a debit or credit card, cash, a cheque, paypal or other channel. You take care only you and the people you trust have access to your money. Corporate treasurers build and maintain a banking infrastructure that allows payments. They think about who is allowed to make payments (often they are), who can authorize (not a payment person), what bank to use and potential other payment channels.

You have a mortgage or personal loan so you could buy a house or pay for groceries when at the end of your paycheque the month did not come to an end yet. Corporate treasurers find funds necessary for their company and have a wider set of products available like bank credit facilities, bonds or new equity.

You feel fluctuations in interest and currencies when you cross the border to another currency country. Your mortgage, current account and credit card come with an interest. Both currencies and interest change over time: financial markets are not stable. Many of us just accept these changes. Corporate treasurers think and manage these risks: they think about the currencies in commercial contracts, about the length & price of various funding products and about mitigating the risks, for instance using derivatives.

Of course the above description is an oversimplification of the position. Treasurers have many other tasks and the complexity in a corporate environment is higher than a standard household situation. Furthermore I want to stress is that treasurers are not bookkeepers or controllers: they do not send or receive invoices and do not write the annual report. They manage actual money flows.




Pieter de Kiewit

Owner Treasurer Search


Blockchain: Game-changer for Small & Medium Enterprises?

| 21-06-2019 | Carlo de Meijer | treasuryXL

In many countries Small and Medium-sized Enterprises (SMEs) are the backbones of their economy. Their role is crucial to worldwide economic and social developments, with more than half of the overall world population working in such companies. In the Netherlands for instance, more than 90% of the Dutch companies are SMEs and together they produce 60% of the added value of the Dutch Economy. SMEs however are confronted with a number of important challenges. including limited access to bank loans, inefficient procedures and lack of information necessary to conduct business efficiently.

While most people relate blockchain to large companies, blockchain also opens new opportunities to SMEs in every sector to solve existing challenges and enable them to optimise their business and develop new business models. Up till recently there were several obstacles which led to slower adoption of blockchain and other distributed ledger technologies by SMEs. But that is changing.

Let’s have a look!

SMEs and present challenges

Despite their status as the backbone of any major economy, SMEs face many challenges. They have a great problem in finding  financing, scale their operations, process payments and recruit other ancillary services that are both necessary to grow or go global. For emerging economies, increasing access to credit is key to generate of new jobs and economic growth.

  • Bank loans

 A big problem for SMEs, esp. for beginning entrepreneurs is to get a loan from banks for starting or growing their business. This is why many of the new or ongoing small and medium-sized businesses disappear. Almost 30% of SME companies shut down in the first three years of operation due to lack of funding.

Since the banking (credit) crisis of 2008, banks are inherently risk averse, so their tolerance for SME lending has become relatively low. Last year’s report from the World Bank estimated that 70 percent of small, medium, and micro-enterprises are unable to access the credit they need. While the global demand for SME credit stand at $2,38 trillion, the truth is, only a fraction (about 15%) of businesses actually get the loan that they request from banks.

  • Trade finance

 Another challenge for internationally operating SMEs is to get trade finance. Trade financing, much like many forms of credit providing, is a key component of the success of SMEs, but that key is not always easy to obtain. SMEs face lots of hurdles in their quest for funding, especially when it comes to accessing traditional trade finance products. Trade has changed dramatically in the last 10 years. But trade finance has not. The $1.5 trillion trade finance gap is driven by data shortfalls. The industry is still heavily paper-based and follows outdated processes and procedures. Typical trade finance operations are as a result still time-consuming, bureaucratic, and simply too expensive for new SMEs. This disproportionately impacts small- and medium-sized firms and firms in Asia and the Pacific.

  • Cash flow issues

 Inability to bring in capital continues to cause enormous harm to small businesses–stifling growth and causing cash flow difficulties. In fact, 40 percent of small businesses reported cash flow issues within the past year. Businesses need cash flow to pay for materials, start the production process, pay employees, or cover any other business expenses. For smaller companies a late payment can be the difference between success and failure.

  • Limited alternative financing

 These SME companies nowadays often turn to alternative forms of financing to obtain funds and ease their cash flow issues. In recent years, the peer-to-peer (P2P) lending system emerged as an alternative to the bank loans. And this segment is growing. Crowdfunding has also emerged to fill the gap in the market, but is mainly focused on technology start-ups. This new funding route is closed to most SMEs from other sectors.

  • Personal identity

Personal identity and data control are major concerns for online retailers as most of the interactions between customers, and online retailers are controlled via usernames and passwords stored in centralized platforms. Such platforms are vulnerable to hacking, and user data can be accessed and misused by hackers. Next to that people can easily falsify documentation and identity proofs.

  • Adoption of new technologies

 Another major challenge for many SMEs is how to deal with new trends in digitalization and automation. While large corporates often have the resources to react promptly, experiment and develop new products and services and thus benefit from the new technologies like blockchain, this is not the case for many SMEs.

This while they are experiencing problems for which these solutions including blockchain could be a solution. Many small- to medium-sized companies find it difficult to get started with new technologies since the scale of SMEs is often too small, among other reasons. Most SME’s miss the manpower, skills and knowledge to develop new strategies on such new trends.


Use cases

Blockchain presents itself as a solution to these challenges. This technology could solve the problems in the areas of funding and trade finance. Though it makes sense to use blockchain for money-related businesses, they may also be used to solve many of their inefficiency problems. Safe and secure data transactions and smart contracts may optimise supply chains and improve client satisfaction by automated services.

  • Trade finance           

Blockchain could became a game-changer for SMEs that are looking to expand abroad in their search for trade finance. Trade finance products are being made more efficient due to transparency and the consensus mechanisms that replace multiple instances of verification and checking.

A new study by the World Economic Forum and Bain & Company shows that blockchain technology could play a major role in reducing the worldwide trade finance gap, enabling trade that otherwise could not take place. Another finding is that the impacts would be largest in the emerging markets and for SMEs which may display the use of the technology beyond well-established markets and corporations.

The Asian Development Bank forecasts the global trade finance gap currently stands  at $1.5 trillion, or 10% of merchandise trade volume and is set to grow to $2.4 trillion by 2025. But the results from the new study shows the gap could be reduced by $1 trillion using blockchain technology efficiently.

  • Supply chain finance

Blockchain technology may also contribute to solve the problem of getting supply chain finance. A bigger segment of the market is nowadays building open account solutions. But because of the difficulty in tracking how deep the supply chain is, often financing is only offered a few tiers deep. As blockchain is much more flexible with data than existing digital systems, this technology opens up the possibility of this level of financing.

On blockchain, both suppliers and buyers have access to necessary transactional information in real-time. Every step of the supply chain process is time-stamped and verified by all parties, meaning that information is accurate and immutable. This added level of visibility may also mean that businesses will have more invoice financing solutions available, too. This transparency may result in faster transaction processing improved cash flows for suppliers, and potentially better rates from invoice finance providers.

  • Smart contracts

One of the most attractive features that blockchain has is the potential to offer SMEs smart contracts, which not only define the terms and penalties around an agreement in the same way that traditional contracts do but also automatically execute and enforce those pre-agreed terms and conditions (but without the need for middlemen). Many labour intensive and expensive business processes can easily being replaced at little cost.

The largest opportunities could come from smart contracts, single digital records for customs clearance. Smart contracts can represent an invoice, or any similar financial document, and be used as collateral to support a loan. They would help mitigate credit risk, lower fees and remove barriers to trade.

To avoid the initial development costs of building on Ethereum, there are already blockchain companies like Confideal and dApp Builder that make it easy to create and launch a complete smart contract portal with just a few clicks.

  • Funding/collateral

Blockchain technology has the potential to completely “reinvent the wheel” when it comes to SME funding. Blockchain could help revive peer-to-peer lending practices that has emerged outside of the regular banking system, by digitizing what was once a manual process.

Through disintermediation, blockchain makes it significantly easier and faster for small and medium-sized companies – not just technology start-ups – to raise funds through equity. The removal of these barriers reduces the need for complicated paperwork, while the automated nature of the process may mean that  commissions, excessive brokerage fees associated with selling shares, and other overheads can all be left behind.

  • Identity management 

Another area where blockchain could become a game changing factor is in the area of online identity verification. A growing number of SMEs do their business online triggering demand for increased online security. The risk of identity theft and fraud could be eliminated with the use of a decentralized identity, such as blockchain. It allows a more effective and reliable form of identification of a person without the requirement for third party involvement. As well as the benefits in terms of the reliability of the verification, the speed at which checks can be performed is much faster. This can help businesses speed up processes and make them more reliable.


SME-focused initiatives/projects

To address the various challenges for SMEs in their search for blockchain solutions, a growing number of SME-focused initiatives have been launched.

  • Blockchers project

One of these programs is Blockchers, as part of the European Horizon 2020 project. Blockchers is a project that will facilitate the revolution of blockchain and other distributed ledger technologies (DLTs) across European SMEs. It is an acceleration process for SMEs and start-ups to build real world use cases of blockchain technologies, thereby financing real world use cases of this technology in traditional sectors.

One of the main goals of Blockchers will be fostering the matchmaking among traditional SMEs and potential DLT specialists, as technology providers, and “sensitize about the benefits and opportunities around DLTs to implement real use case scenarios in a variety of verticals”.

Alastria Blockchain Ecosystem has been chosen by the European Commission as the technological partner for the Blockchers Project. They will  provide the blockchain infrastructure to the start-ups participating in this EU Project, developing blockchain solutions to SMEs.

  • Project Blockstart

To make sure SMEs can experiment “if and which blockchain solution will help to tackle the problems in their activities”, Bax & Company, a leading European innovation consultancy, has set up the project Blockstart. The aim of Blockstart is to increase the competitiveness of SMEs in the health, agro-food and logistics sectors by providing business support, identifying and testing business opportunities from blockchain innovations. Working together, the partners that will form an international ecosystem of business networks, incubators and blockchain experts, will test the market readiness of different blockchain solutions in real-life settings. Blockstart will help small- to medium-sized enterprises (SMEs) strengthen their competitive positions through the use of blockchain technology.

  • Dutch logistic project

And there is the project of RDM Knowledge Center and Sustainable PortCities in cooperation with Windesheim University of Applied Sciences, to investigate the opportunities for SMEs in the Dutch logistics sector to benefit from logistics applications of blockchain. In the project SMEs active in cold chains, the pharmaceutical industry, transport, forwarding and warehousing are involved.

They try to give answer on questions that SMEs ask, including: what are the consequences of blockchain for their business model?; what kind of knowledge should they have about the potential of blockchain?; could blockchain technology improve their logistic processes?; and, how can blockchain technology create added value for their company?

  • Singapore PLMP Project

Singapore blockchain company PLMP Fintech has launched the Blockchain Technology Creatanium Centre (BTCC). BTCC is a blockchain centre, focused on accelerating the blockchain ecosystem for Singapore small and medium-sized enterprises (SMEs) across various industries, allowing businesses to compete on a global level and increase efficiencies in operations and funding. BTCC will also provide education and development as well as house a blockchain and ICO ecosystem.

Similar centres are planned for Indonesia and Thailand.


SME-focused blockchain platforms

Furthermore, to help increase blockchain’s adoption across multiple industries and enlighten businesses of the technology’s potential, a large number of open source collaborative blockchain platforms have been created such as Hyperledger, Ethereum etc. Their main goal is allow enterprises to build customised blockchains that would answer specific needs instead of letting companies solve issues on their own. In recent years also platforms specific focused on SMEs have been launched such as We.Trade, Karma and others.

  • We.Trade platform (trade finance) 

Nordea has launched a blockchain-based platform designed to make it easier for SMEs to trade with other companies in Europe. The platform, a blockchain network for trade finance, is available to all Nordea SME customers, with trading controlled through a set of rules designed to bring security to the process.

The new offering is built on the platform developed by a group of 12 banks using IBM blockchain technology. The aim of the project is to simplify trade finance processes for SMEs by addressing the challenge of managing, tracking and securing domestic and international trade transactions by connecting all of the parties involved (i.e. buyer, buyer’s bank, seller, seller’s bank and transporter), online and via mobile devices. Providing more companies more efficient access to trade financing and credit across Europe will allow them to grow their business by expanding into new markets and forging new trading partnerships.

  • Karma (funding)

Karma (Russia), launched early 2018, is a true P2P platform which is fully decentralized. By design, the platform is a unique enabler that gives SMEs access to additional liquidity. Based on the blockchain technology, it enables users to invest in any SME. The platform offers its users a wide spectrum of investment opportunities. One of the features that make Karma “stand out of the crowd” is its ability to let investors lend to SMEs anywhere around the world.

  • Traxia (trade finance)

Traxia is a decentralised global trade finance platform. The proposed new blockchain-based system used to assess the creditworthiness of SMEs, will build a bridge between the banks, the SMEs and the data provider.

By using the blockchain, and smart contracts they will be able to offer transparent, fast, and not so costly transactions for small businesses. Thereby solving the long waiting problem by allowing for a transparent platform for invoice trading designed just for SMEs.

The loan system will connect technology to how people think and behave to determine who is credit-worthy. The system will link alternative payment data to accounting certificates to mobile and social data to psychometrics. The alternative payment data thereby looks at utility payments, rental payments and accounting certificates.

  • Blockchain identity platforms

Already, a number of blockchain-based companies are taking advantage of blockchain’s identity tools. Its decentralized nature and security features to provide better and more transparent identification tools, offers a way for customers to identify themselves and have access to certified documents and notaries as well as a marketplace for customers to purchase services and products.

Instead of buying expensive, centralized server architecture or “paying hefty fees” to companies like Amazon Web Services or Google, a comprehensive start-up CEO might instead choose to rent custom-sized decentralized hosting space from a blockchain platform. This provides increased data integrity and a more efficient cost plan as well.

  • Other blockchain-based platforms for SMEs

A group of 11 Indian banks have teamed together to unveil the nation’s first blockchain-linked funding for SMEs. The goal is to revamp lending for “default-prone small firms”, by helping bring forth the virtue of transparency. The blockchain network will allow the banks to access public credit data so they can reduce risks when offering lending. In 2018, the Hong Kong Monetary Authority (HKMA) embarked on a similar undertaking and launched eTradeConnect. The blockchain-powered platform was aimed at solving the various challenges that hamper the link between banks and SMEs.

Later that year, the Abu Dhabi Global Market, another multinational financial hub located in the United Arab Emirates, entered into a joint agreement with HKMA and Singapore’s central bank. They aim to create a blockchain-powered, cross-border trade and finance platform for SMEs hassle-free access to funding.


What advantages may blockchain bring for SMEs?

Blockchain has the potential to offer a lot of distinct advantages to small and medium-sized businesses, such as trust, speed, more safety and security as well as risk reduction in terms of lesser identity fraud and hacking, thereby reducing time and unnecessary costs.

This may enable them to solve the cash flow problem, the paperwork issues, as well as the problem to go global (thanks to the globality of blockchain platforms), preventing them from going bankrupt.

  • Available funds

First of all the risk of getting no funds at all will be greatly reduced. Because there is no doubt about when funds will be released, companies can deliver services in time knowing that funds will always be available when they should be. Payments for goods from distant buyers and payroll to overseas employees may become easier and can be completed at a fraction of the current costs. As a result, it can help bring products and transactional services to market quickly and inexpensively.

  • More safe and secure transactions

Security and transparency will also prove to be value-added benefits of blockchain for businesses. For SMEs with global aspirations, blockchain technology using secure communication techniques may guarantee more safety and security in their transactions.

The blockchain technology will assist firms to overcome problems associated with asymmetric information, collateral requirements, a lack of sufficient credit reporting agencies and internet data security and cybercrime. Blockchain technology thereby ensures safe, automated and efficient data transactions that may be used in the exchange of private information, or monitoring goods in transport or tracing the origin of food products.

  • More cost efficient processes

To make their processes more efficient , blockchain applications will definitely streamline business processes and offer a great potential for reducing costs and complexity of processes.

Significantly reducing overhead costs is a major advantage for small businesses hosting services on the blockchain. Using blockchain means reducing the amount of resources and time entrepreneurs put in for administrative tasks. This may contribute to offload the traditionally high costs of security, Know Your Customer (KYC) protocols, data storage and other overheads.

Apart from significantly reducing the investment that founders must make in these support activities, the cost savings can be passed onto customers to make prices more competitive. This may allow SMEs worldwide to compete on a more level playing field.


What are SMEs already doing?

A study conducted by the Emory University (US Atlanta) in collaboration with Provide Technologies and Aprio claims that the small and medium enterprises are investing twenty-eight times more in blockchain than large enterprises. The report furthers that most of the blockchain-based projects are aimed towards business process automation while authentication and compliance are the second and the third most significant blockchain usage across the globe. The report also marks that the payments industry stands fifth when it comes to blockchain adoption whereas, identity management and market place governance follow the top tier applications very closely.

There is a growing community of innovative start-ups that are developing SMEs focused blockchain solutions. However, the sectors in which DLTs really make sense, besides fintech, could be those in which existing SMEs do not (yet) have enough knowledge on how DLTs work nor how they could uptake these technologies (traditional SMEs).

Need for regulatory framework

Blockchain SMEs face uncertain regulation that limits their scope of action and imply a risk for their growth. The real challenge, going forward, will be the legality of smart contracts, and a global regulatory framework needed to establish true peer-to-peer lending across borders; just because it is legal in one country, does not make it so in the next.

A “good” regulatory framework should bring more clarity, fostering the uptake and prevent from fraudulent actions such as those linked to the anonymity of users in transactions. In the meantime, the power and potential of blockchain and smart contracts is increasingly being recognized across the business and political spectrum. While it may take regulators some time to catch up, broader adoption will lead to sensible regulation.

Forward thinking

Looking at these advantages, it is easy to see why a growing number 0f entrepreneurs  in the SME world is willing to invest more into blockchain. With the blockchain and related services such as smart contracts, the SME world may expect to see a total transformation of how they nowadays do their business. Blockchain will make international dealings more conducive for SMEs and may allow them to compete in ways that are unthinkable today.

Blockchain is however still in its early stages. The mass adoption of blockchain by SME companies has not yet started, and widespread adoption will take time. For this to happen, the biggest obstacle is getting more businesses to build on blockchain and drive customers toward these solutions. This asks for trust.

Trust will be built over time, and in order for the promises to become a reality, some businesses must start trusting the process. Proving to the world that there is a lot of opportunity in using the blockchain for absolutely everything related to business.  Given how this technology could boost trade by more than $1tn in the next ten years, according to World Economic Forum, this may be a call-up to the big blockchain companies to come up with SME friendlier solutions.



Carlo de Meijer

Economist and researcher



Beleggen kan zeker ook anders, en zinvol!

| 11-06-2019 | ILFA Group | treasuryXL |

ILFA Group geeft een update over het fenomeen crowdfunding in combinatie met impact. De adviseur van de klant, of deze nu financieel planner, accountant, belastingadviseur, family office, vermogensbeheerder of beleggingsspecialist is, ontkomt er niet aan om crowd- of maatschappelijke funding een plaats te geven in het totale financiële plaatje en het vermogen van de klant. Het risico bestaat dat de klant door de bomen het bos niet ziet, en daar ligt ook qua selectie een mooie kans voor adviseurs om klanten te helpen en te begeleiden. Niet alleen als de klant hierom vraagt, maar proactief kun je als trusted adviseur jezelf alvast verdiepen in de aanbieders, de projecten, de verschillende instrumenten (obligaties of aandelen), maar ook de diverse platformen. Zeker nu er ook door de AFM een duidelijker dan vroeger, regelgevend kader is opgesteld.

Robert van Beek CFP® €FA FFP is zelfstandig consultant bij About Life & Finance BV te Roosendaal. Irma Langeraert is managing partner bij ILFA Group en het maatschappelijke fundingplatform AndersFinancieren, eveneens gevestigd te Roosendaal. AndersFinancieren is één van de drie crowdfundingplatformen welke opereert op basis van een vergunning als beleggingsonderneming.


(Vermogende) spaarders en obligatiebeleggers zijn op zoek naar rendement. De rente op spaarrekeningen staat al jaren zo laag dat sparen met de box 3-heffing een negatief rendement oplevert. Veel mensen hebben een (lange) zoektocht afgelegd naar rendement, maar vinden dit niet in aandelen of directe vastgoedbeleggingen zoals verhuurde (vakantie)woningen. Geld blijft bij gebrek aan andere alternatieven op de bank of spaarrekening staan. Veel beleggers, hun vermogensbeheerders en adviseurs, moeten of willen ook nog steeds naar obligaties kijken als onderdeel van hun totale asset allocatie. Maar ook de verwachte rendementen op klassieke, beursgenoteerde obligaties blijven laag.

Voor maatschappelijke, Nederlandse organisaties die op zoek zijn naar financiering bestaat een vergelijkbare zoektocht. Het invullen van de financieringsbehoefte voor deze organisaties wordt, zeker als het om onroerend goed gaat, door banken steeds moeilijker. Dit heeft weinig te maken met de businesscase, maar alles met de verscherpte eisen onder Basel IV. Omdat het koppelen van vraag en aanbod van geld buiten een bank om, niet goed functioneert, leidt dit inmiddels in de reële economie tot hoge rentepercentages. Dit ondanks dat de officiële rente toch laag staat en we duidelijke tekenen zien van een in middels (in sommige regio’s en steden sterk) herstellende vastgoedmarkt.

Een crisis heeft vaak als voordeel dat mensen bewuster gaan leven en bewuster omgaan met hun geld en vermogen. Er ontstaat een verhoogde aandacht voor de mens zelf, de maatschappij, duurzaamheid, het klimaat en het milieu. Het moment zou je zeggen waarop par tij en aan beide kanten van de balans elkaar zouden moeten gaan vinden. (Crowd)fundingplatformen waar geldgevers en geldnemers aan elkaar worden gekoppeld, kunnen en willen hier een belangrijke rol in vervullen. Het goed van de grond krijgen van dit zogenaamd ‘alternatief’ financieren vraagt echter van de beleggers een bezinning op hun asset allocatie, van beleggingsadviseurs en vermogensbeheerders dat men de illiquide markt betrekt in hun afwegingen en dat de toezichthouder een duidelijk wettelijk kader neerlegt. Dan weten zowel beleggers als hun adviseurs wat ze kunnen en mogen verwachten van de (crowd)fundingplatformen.

Alternatieve financiering

De overheid, zorgverzekeraars, zorgverleners en banken hebben allemaal een rol en verantwoordelijkheid in de zorg voor mensen in onze maatschappij. Nieuwe regels rond financiering voor banken (Basel IV) en de toename van kosten en een terugtredende overheid inzake financiering van de zorg, zorgen voor veel uitdagingen. Er ontstaan meer publiek private samenwerkingen. Als ze met elkaar de handen in elkaar slaan, kunnen organisaties gefinancierd en geholpen worden en een kwalitatieve zorgverlening en huisvesting mogelijk maken. In januari van dit jaar is door Helen Toxopeus vanuit wetenschappelijk onderzoek aangetoond met een proefschrift dat de financiële sector duurzame innovatie slimmer kan financieren. Ook vanuit Europa (Council of the European Union) is er heel recent nog een notitie geschreven over hoge (compliance) kosten, administratieve belemmeringen maar ook liquiditeit en toegang tot de kapitaalmarkten in verband met financiering en kapitaalverstrekking middels aandelen en obligaties via (MTF-)platformen aan groeiende SME (kleine en middelgrote) ondernemingen. Europa roept op om verbeteringen door te voeren, maar ook om meer promotie te maken voor MTF- en hiermee ook crowdfundingplatformen! Zie Council of the European Union, 2018/0165 (COD, EF100 ECOFIN 285 CODEC 651 IA 103) 15 Maart 2019 Promotion SME growth markets EU
596/2014 and EU 2017/1129.

Welke rol crowdfundingplatformen hebben, en ook welke (basis)stappen en onderdelen uitmaken van financiering wordt duidelijk in figuur 1.

Figuur 1: Financiering, de verschillende stappen, onderdelen, begrippen, factoren en actoren

Alternatieve financiering door gestapelde financiering in de zorg

De kredietverlening door klassieke bankleningen blijft ook onverminderd lastig voor mkb-ondernemingen. Hier zie je dat dit probleem zoals vanouds, opgevangen wordt door succesvolle ondernemers die startende of bevriende ondernemers willen helpen. Vraag naar en aanbod van vermogen worden hierbij direct (onderhands) of via bemiddeling samengebracht. En waarom zouden ondernemers in plaats van alleen maar in klassieke beursgenoteerde aandelen van corporate ondernemingen of beleggingsfondsen niet ook (een deel van) hun vermogen investeren in bedrijven waar ze meer voeling bij hebben? Al dan niet in hun eigen regio, met daarbij desgewenst een actievere aandeelhoudersrol spelen, of vanuit hun ideologie en waarden, om collega-ondernemers te helpen. De business angels blijven populair. Aan de andere kant van het spectrum zijn er de kredietunies die in de praktijk dan weer voornamelijk een sociaal-maatschappelijke rol vervullen.

Een vergelijkbaar proces moet ook voor de maatschappelijke en zorgsector mogelijk zijn. We hebben er allemaal belang bij dat vernieuwing en verduurzaming van zorg, betaalbaar wonen en wonen met zorg, voortvarend wordt opgepakt. Dit kan alleen als er meer gebruikgemaakt gaat worden van zogenaamde gestapelde financiering.

Een eerste groot gedeelte van het vermogen van een traditionele (zorg)organisatie wordt gevormd door het eigen vermogen. Het vreemd vermogen wordt door de bank verstrekt via een klassieke financiering op basis van een onderpand. Als een derde deel toegevoegd wordt, bijvoorbeeld door obligaties via derden, kan zowel een deel van het eigen vermogen in plaats van uitgebreid, terug verminderd worden als ook het bancaire krediet blijven bestaan, waardoor je totaal weer in balans is. Onnodig besparen op uitgaven om middels winst het Eigen Vermogen te versterken kan op deze wijze worden voorkomen.

Figuur 2: Gestapeld financieren: in plaats van meer eigen vermogen en minder bancair krediet, behoud van het bancair krediet en toevoeging van vermogen via derden

De vormen van deze alternatieve financieringsvormen zijn divers. Zo zijn er kleine (converteerbare) obligatieleningen uitgegeven voor een groot publiek (zelfde domein als waarbinnen crowdfundingplatformen actief zijn), maar ook leningen via crowdfundingplatformen. (Crowd)funding van (maatschappelijk) vastgoed is in populariteit erg sterk toegenomen de afgelopen tijd.

Toezicht door AFM op instrumenten en/of platform

Als het via een platform mogelijk is om te investeren in een onderneming door koop van verhandelbare aandelen of obligatie(s), dan is er sprake van aankoop van effecten waarbij een platform orders ontvangt en doorgeeft. Voor de beleggingsdienst (order remissier) is dan een vergunning als beleggingsonderneming van toepassing. Is het ook mogelijk om andere leningen dan obligaties te verstrekken, dan dient de beleggingsonderneming (het platform) ook een ontheffingbemiddeling in opvorderbare gelden te hebben. Eventuele betaaldiensten, of hypotheekverstrekkingen aan consumenten of ondernemers betekenen ook vergunningen voor bemiddelen in betaalrekeningen en krediet.

Platformen die bemiddelen in leningen dienen vooralsnog niet te opereren binnen de Wet financieel toezicht. Deze ruimte is destijds geboden om de start van crowdfunding in Nederland mogelijk te maken. De AFM houdt wel toezicht en heeft sinds 2016 na een eerder rapport van 19 december 2014 een focus gelegd op de werking van crowdfundingplatformen. Na onderzoeken zijn er een aantal zaken aangescherpt en zeker voor wat betreft informatieverstrekking bleek met een beleidsregel dat informatie en meer specifiek over projecten, een verbeterslag moest plaatsvinden. Op 28 februari 2019 werd gesteld dat de informatieverstrekking bijvoorbeeld over nettorendement en verbeterd is. Deze conclusie trok de AFM na een self-assessment uitgevoerd in 2018 onder 47 platformen.

Een aantal randvoorwaarden die eerder al gesteld werden, zijn bijvoorbeeld:

  • Een advies om maximaal 10% van het vrij belegbare vermogen te investeren in crowdfunding;
  • Een maximaal te investeren bedrag per platform;
  • Transparantie over betalingsachterstanden, afboekingen en over nettorendementen.

Ondanks deze aanvullende voorwaarden is het regime waaronder deze platformen leningen uitgeven nog altijd lichter dan de platformen welke onder MiFID II obligaties en/of equity/aandelen aanbieden. Met name de zorgplicht richting retail, vermogende en inmiddels professionele belegger is aanmerkelijk zwaarder. Ook moeten platformen met een vergunning twee keer per jaar bij De Nederlandsche Bank aantonen dat zij voldoende solvabel zijn om de continuïteit in de dienstverlening aan hun beleggers te borgen. Des te bijzonder is het dat de crowdfundingplatformen geen zogenaamd ‘wildwest bordje’ dienen te voeren.

Terwijl platformen welke opereren op basis van een vergunning de volgende melding dienen op te nemen indien zij gebruikmaken van de prospectusvrijstelling:

Voor de retailbelegger is dit erg verwarrend. Niet zelden bestaat de perceptie dat een obligatielening aangeboden via een platform dat opereert onder volledig toezicht qua vergunning een hoger risicoprofiel heeft dan een lening via een crowdfundingplatform welke functioneert op basis van een ontheffing.

De AFM heeft wel een register aangelegd waarbij van de crowdfundingplatformen vermeld staan: vergunning of vrijstelling, maar ook algemene gegevens zoals KvK-nummer en de adresgegevens. Ook de activiteiten die uitgeoefend mogen worden bij zowel de vergunning of de ontheffing staan vermeld. Het register en de vergunning zijn alvast zeer belangrijke stappen, maar in een markt met groeiende interesse bestaat er natuurlijk altijd een risico dat wet- en regelgeving en/of de AFM achter de feiten aanloopt en dus ook niet-bonafide par tij en actief zijn/worden! Daarom heeft de AFM een monitoring waarbij jaarlijks uiterlijk op 30 september (over januari-juni) en op 31 maart (over juli-december) een monitoringformulier ingevuld en ingezonden dient te worden.

Voor platformen die nu werken op basis van een ontheffing is Europese wetgeving in de maak. Hoewel er nog veel werk is te verzetten, is de verwachting dat de wetgeving medio 2020 van kracht zal worden. Voor een deel van de platformen zal de transitie die zij vervolgens moeten doormaken een brug te ver zijn. Momenteel zijn er al 16 van de 51 geregistreerde platformen inactief.

Informatievoorziening en investeerderstoets

Op het gebied van informatievoorziening dient een platform een aantal zaken te regelen waaronder een investeerderstoets. Deze toets is vormvrij maar dient in correcte, duidelijke en niet-misleidende bewoordingen te zijn opgesteld. De gemiddelde consument moet deze kunnen begrijpen en de tekst mag niet wervend zijn, want projecten mogen niet worden aangeprezen. De suggestie mag niet worden gewekt dat er sprake is van een aanbeveling! De toets zelf dient te checken of kennis en ervaring aanwezig zijn bij de consument om te begrijpen welke risico’s verbonden zijn aan het project, crowdfunding in algemene zin en het specifieke platform. Met de eerdergenoemde spreiding dient dan ook geïnventariseerd te worden of een verantwoord deel van het vrij belegbaar vermogen (maximaal 10%) belegd wordt. Ook de communicatie over uitslag van de toets moet objectief gebeuren. Bij een negatieve uitslag moet de consument via een waarschuwing nadrukkelijk gewezen worden op de risico’s.

Rendement, risico, kosten en meer

Crowdfunding is zeker ook met de door de AFM geformuleerde begrenzing van 10% van het vrij belegbaar vermogen, te beschouwen als een beleggingscategorie. De rendement- en risicoafweging moet net zoals bij andere assets gemaakt worden en belangrijker nog, juist bezien worden in combinatie met de andere traditionele beleggingscategorieën waarover het belegbaar vermogen gespreid wordt. De specifieke beleggingsrisico’s zijn inherent aan (beursgenoteerde) aandelen- of obligatiebeleggingen.

Specifiek voor crowdfunding komen daar ook nog bij:

  • Operationele risico’s van platform;
  • Faillissementsrisico;
  • Betalingsrisico tussentijdse of aan einde looptijd rente- en aflossingsverplichtingen;
  • Verhandelbaarheid/liquiditeit als dit via het platform mogelijk is.

Omdat er ook platform-specifieke risico’s zijn, worden door de AFM ook geschiktheidseisen aan bestuurders van crowdfundingplatformen gesteld bij het verlenen van de vergunning.

Johan Leupen, 20 september 2018, het Financieele Dagblad

Rol van adviseur

Wanneer een klant bij de adviseur komt met een vraag over crowdfunding is het goed even stil te staan bij de motivatie van de klant. De waarom-vraag dient gesteld te worden ook voor jezelf als financieel planner of (vermogens)adviseur om een goede afweging te maken of, en zo ja, hoe je je klant verder wil begeleiden.

Je klant kan een (vermogende) persoon of familie zijn die zich afvraagt of deze manier van beleggen een alternatief kan zijn voor een deel van zijn beleggingsportefeuille of aanvullend als onderdeel van de totale asset allocatie van zijn of haar vermogen.

In dat geval kan diversificatie, door te investeren in een lening aan een (zorg of maatschappelijke) organisatie een mooi of interessant idee zijn waarbij de andere obligatiebeleggingen (vervanging of uitbreiding) in lijn moeten zijn met het beleggings- en risicoprofiel van de klant. Meer en meer zie je dat investeerders het verschil willen maken en met bijzondere aandacht focus willen leggen op maatschappelijk relevante investeringen: Impact investing! Deze belegger wil op een bijzondere manier betrokken zijn bij de doelstelling van de geldvrager en/of hun inleg voor een deel als een gift zien of de projecten staan dichter bij persoonlijke drijfveren en de beleving van de belegger.

Belangrijk is dat de afweging gemaakt moet worden samen met de klant of crowdfunding via lening of aandeel, past in het totale plaatje past bij de risico’s, de kennis en ervaring, de beleggingsportefeuille maar ook het beleggings- of risicoprofiel van de klant (zie R.G.J. van Beek & R. Wernsen ‘Adviseur moet af van klassieke asset allocatie!) Wanneer rente ontvangen wordt, dient natuurlijk de verstrekking van de lening, maar ook de rente en aflossingen afgestemd te worden met de inkomensdoelstelling.

Neem voor meer informatie contact op met Robert van Beek ( of Irma Langeraert.

Kredietbeoordeling banken: trends en ontwikkelingen

| 29-5-2018 | By Peter Schuitmaker |


Kredietbeoordeling door banken? Duidelijk is dat de kredietverstrekking door banken stagneert. Vandaar allerlei nieuwe initiatieven als kredietunies en crowdfunding. Ontwikkeling in de wereld van private equity, participatiemaatschappijen, investeringsfondsen zoals NPEX en de diverse mogelijkheden voor staatsgarantie Garantie Ondernemingsfinanciering, Groeifaciliteit en Borgstellingskredieten MKB. De banken doen nog wel mee. Maar dan met nieuwe spelregels: de nieuwe trends en ontwikkelingen kredietbeoordeling banken.

Traditionele beoordeling

Traditioneel werd de kredietbeoordeling door banken gebaseerd op een viertal criteria. Op de eerste plaats was dat de ondernemer. En met name zijn kennis, ervaring, zijn track-record als ondernemer, de moraliteit en zijn financiële betrokkenheid (commitment). Daarnaast telden mee de rentabiliteit (winstgevendheid), de solvabiliteit (verhouding garantievermogen (eigen vermogen) en totaal waarde van de activa) en de dekking (omvang en kwaliteit van de geboden zekerheden).

Kredietbeoordeling nieuwe stijl

Tegenwoordig worden beduidend meer aspecten meegewogen bij de kredietbeoordeling door banken. Bij een kredietaanvraag moeten deze helder in beeld gebracht worden. Deze  beoordelingscriteria moeten aantoonbaar een ruime voldoende scoren. Banken beoordelen de operationele bedrijfsmatigere risico’s, de structuur risico’s en financiële risico’s. Maar ook het eigen verdienmodel wordt meegewogen. Dit artikel behandelt recente ontwikkelingen bij het proces van de kredietbeoordeling.

Positie in de waardeketen

Een van de kernvragen bij kredietbeoordeling is: welke waarde voegt de kredietnemer toe. En in het bijzonder: wie zijn afnemers en toeleveranciers. Hierbij wordt dus gekeken naar de branche in zijn geheel. Dus de (meer algemene) kenmerken van de bedrijfstak waarin de kredietnemer actief is. Daarnaast ook meer specifiek: wie zijn met name de afnemers en toeleveranciers. Hoe is de financiële gezondheid van deze partijen. Wat is hun betalingsgedrag? En welke trends zijn er in de bediende markt die de positie in de waardeketen kan beïnvloeden. Kortom: wat zijn de hiermee verbonden bedrijfsmatige en financiële risico’s.

Primaire bedrijfsproces

Een ander aspect bij de kredietbeoordeling is de organisatie, stabiliteit en efficiëntie van het primaire (productie)proces. Welke waarde wordt toegevoegd en wat zijn de daarmee samenhangende voortbrengingskosten. Met andere woorden: hoe effectief is dat proces en welke professionele rol speelt daarin het management.

Financiële structuur

Een uitgewerkte balansanalyse is een onmisbaar onderdeel van de kredietaanvraag. Deze omvat een toelichting van de omvang  van de activa. Bijvoorbeeld: het vlottend actief. Staat het werkkapitaal wel in de juiste verhouding met de omzet en de directe kosten en inkopen? En de omvang van het vast actief? Wat was de basis van het investeringsbeleid? Wat is het gebruik van deze vaste activa? Wat zijn de bezettingsgraden? In hoeverre generen deze activa een kasstroom? Waar zitten deze risico’s?


Welke verplichtingen zijn er buiten de balans (huur, operationele lease). Maar ook: wat is de aard van de passiva. Hoe stabiel (zeker) zijn deze? En ook de stabiliteit van de balansverhoudingen: hoe wordt het vaste actief en vlottend actief gefinancierd? En hoe stabiel zijn deze verhoudingen?

Cashgenererend vermogen

Misschien wel het belangrijkste aspect bij de kredietbeoordeling is het vermogen om kasstromen te genereren. Wat is over langere periode de vrije kasstroom? Hoe aannemelijk is deze? Hoe getrouw is deze prognose en hoe werd deze onderbouwd? De beschikbare vrije kasstroom is de EBIT -/- winstbelasting hierover +/+ de afschrijvingen +/+ de non-cash items (mutatie voorzieningen) -/- investeringen in werkkapitaal -/- investeringen. En dan de vraag: hoe verhoudt zich deze ten opzichte van de verplichtingen aan de verstrekkers van het eigen en vreemde vermogen: noodzakelijke dividendbetalingen (om betaling van rente en aflossing van financiering in de holding mogelijk te maken), (financial) leasetermijnen, rente en aflossing van schulden van de kredietnemer.


Banken wegen vooral ook structuurrisico’s mee. Zo wordt er nadrukkelijke gekeken naar de omgeving van de kredietnemer. Binnen welke (groeps)structuur wordt geopereerd. Wat zijn de risico’s van een cashdrain naar verbonden ondernemingen? Bijvoorbeeld door intercompany transacties. Kan houvast worden gekregen op dividenduitkeringen aan moedermaatschappijen? Welke entiteiten behoren tot de creditbase: de direct verbonden kredietnemers en de (hoofdelijk) verbonden borgen. Kortom , die partijen die aangesproken kunnen uit hoofde van het verstrekte krediet. Beoordeeld wordt ook de extended creditbase. Hiertoe behoren de partijen waarvan de financiële gezondheid van invloed is op de vermogenspositie van de kredietnemer. Het kan hierbij gaan om leverancierskredieten of overige (strategische) samenwerkingspartners (of ketenpartners) die financiële belangen hebben bij de kredietnemer (lees: financieringen verstrekt).

Overige aspecten

Daarnaast zijn er een aantal criteria die meewegen zoals de juridische positie, vergunningen (bedrijfsvoering, producterkenningen en –certificeringen) en milieuaspecten. Ambities en een geïmplementeerde visie op het gebied van MVO (maatschappelijk ondernemen) helpt om paden te effenen.


Een belangrijk criterium voor de kredietbeoordeling is het eigen verdienmodel van de bank. Waar vroeger vooral ‘volume’ van de kredietportefeuille prioriteit kende, is het tegenwoordig vooral de ‘kwaliteit’  van de kredietportefeuille die telt. Dat betekent dat de bank –naast de beoordeling van het krediet- tevens zich ervan zal vergewissen of de opbrengsten van de kredietverstrekking (rente en provisies) voldoende opwegen tegen de kosten en risico’s.

Uniform Counterparty Rating

In een financieringsrapportage moeten de voornoemde aspecten in voldoende mate worden uitgewerkt. Al deze gegevens wegen mee in de UCR systematiek: Uniform Counterparty Rating. Dit is een samenstel van financiële ratio’s en bedrijfsmatige gegevens. Financiële ratio’s zijn bijvoorbeeld operationeel resultaat / omzet, current ratio, crediteurentermijn,  totaal rentedragende schuld / EBITDA , solvabiliteit, enzovoorts. Bij een kredietaanvraag is een overzichtelijk en onderbouwd investeringsoverzicht onmisbaar. Zo wordt duidelijk om welke investering het in de kern gaat: waar zijn de gevraagde middelen voor nodig. En daarbij ook de onderbouwing: de bedrijfskundige motivatie en de bijdrage aan op het rendement en risico van de kredietnemer. Maak hierbij inzichtelijk hoe de kredietnemer het risicoprofiel zal monitoren. En wanneer welke stappen worden gezet als het risicoprofiel verslechtert.  Op deze manier bouwt u een solide kredietaanvraag die op een positieve besluitvorming van uw bank kan rekenen.



Peter Schuitmaker

Registered Advisor for Business Transfer and Succession



IPOs – how to bring your company to the market

| 13-03-2018 | Lionel Pavey |

In the last week, 3 Dutch companies have announced that they will be floating on the stock exchange via Initial Public Offerings (IPOs). Alfen – an energy storage company; B & S – a cosmetics wholesaler; and NIBC – fifth largest Dutch bank in terms of assets. In America, Dropbox and Spotify, among others, are looking to float. Future issues in the Netherlands are expected to include Leaseplan, Varo Energy and Ayden. It is a very busy start to the year for investment banks with plenty of activity in IPOs and mergers and acquisitions (M&A). Here is a summary of how an IPO works.

What is it?

An IPO is when a company offers its shares to the public, which are normally purchased by institutional investors as well as, though usually in smaller amounts, to retail investors – individuals. A company first needs to issue a prospectus to potential buyers – this is a financial document that discloses all relevant information and financial statements about the company, in order that investors can determine the value of the company. 2 critical issues need to be determined – the share price and the number of shares to be issued. Shares are underwritten by one or more banks – they undertake the risk of bringing the shares to market and placing them with buyers. They also carry the risk of having to hold shares if they do not get sold at the time of the IPO.

Why do it?

Companies that have grown eventually start looking for alternative ways of raising funds – either for expansion or investment. The normal routes include bank loans, private placements, or capital injections via new shareholders, along with going public. It allows them to raise equity, offer incentives to management and employees, as well as increasing the awareness and profile of the company. There are large pools of liquidity – specifically pension funds and investment funds – that are looking for attractive investment opportunities. A major consideration for selling shares as opposed to private placements and loan products is the fact that, normally, there is never a need to repay shareholders their capital. As a shareholder you gain access to the increase of the value in the shares as well as dividend payments, both of which reflect the growth of the company. A shareholder has a future claim on a share of a company.

What are the advantages?

A cheaper route to long term capital
Diversification of ownership
The potential ability to attract better management
Alternative source of funding for acquisitions
A simple metric to determine the value of a company – share price * amount of shares

What are the disadvantages?

Considerable paperwork – business information, statements of accounts
Major costs relating to legal, marketing and accounting work
Primary information about your company that is freely published – your competitors
Large amount of time and effort needed to prepare everything
Dilution of power to shareholders
Compliance to new reporting methods – everything must be delivered on time
The issue might not be a success


As a public company, reporting has to take place within certain time frames. This could, therefore, entail considerable investment in updates to accounting and reporting software – and processes – to comply with the regulations. Additionally, whilst preparing for an IPO, the company must still be run and managed as before. All these extra steps are on top of the daily management. Time must be found to make presentations and answer question from accountants, lawyers, investment banks and regulators.

Going live

If all has gone according to plan, an IPO will be successful and the share price will rise. The company’s profile has been increased and business grows. However, there are new responsibilities to shareholders, management and employees. There is a lot more communication necessary.

Final point
In a normal IPO, a company offers a mix of existing shares and new shares into the offering. This allows existing shareholders to realise a profit on their previous investment whilst also offering the company new capital. For the 3 Dutch companies mentioned at the start, all 3 issues are, basically, secondary offerings – no new shares are being created.

Lionel Pavey


Lionel Pavey

Cash Management and Treasury Specialist



Indian Rupee remains very vulnerable

| 04-10-2017 | Rob Beemster |

The Indian rupee has suffered in September severely. In our report we name the issues resulting to the weakening. International companies in India and those trading with India face severe danger from these currency moves. This article will give you an insight how to handle this.

What has changed India in recent months?

It seems latest macro-economic data in India have changed the outlook on its currency. The country is well-beloved due to its place under the economic and international sidelines. Apart from drastic measures taken by the government on monetary and fiscal front, the country is usually not on the forefront of economic papers like other BRICS partners.

What has caused the different outlook on the rupee?    

A, a rise in CPI inflation ( to 2.4% for July from 1.5% in June )

B, a meagre April-June, 2017 GDP report showing a three year low in growth of 5.7% YoY ( 6.1% in the previous quarter ) This is the fourth consecutive quarter with slowing growth

C, signals of a fiscal deficit above the 3.2% GDP target in the running fiscal year

D, almost a year after demonetisation, M3 and bank lending growth remain well below pre-demonetisation levels, a sign of tight liquidity conditions are hurting businesses

Investors and other members of the financial communities dislike a combination of factors A and B. This has resulted in the fall of INR against euro and dollar in September. Although INR is still one of the most popular Emerging Market currencies, a continuation of disappointing economic data might change this international feeling towards INR.  According to RBI data, the recent depreciation is in partly due to equity and bond portfolio outflows.

What to do?

Be aware of a volatile INR. The currency has lost some of its popularity, due to the facts named above. Future is always insecure, take North Korea vs. Trump, how will Brexit change Europe etc. These issues will most certainly have an impact on the dollar and Euro, so may affect the INR as well.

An international trading company, during these unsteady times, should take care of international currency flows. From Sept 8 till Sept 27, INR lost 3 % against the USD. This could be a big stake of the profit margin!

We can help you designing the right structure, whereby a strategy will protect you from harmful currency moves. A lower INR can slam your profit, we help you avoiding this. We know the Indian market. Call us on +31228528579 or mail us via and we will help you to solve your currency risk.


Rob Beemster

Owner of Barcelona valuta experts BV


How to improve your working capital with Trade Finance instruments

| 22-5-2017 | Olivier Werlingshoff |

Trade finance instruments are developed especially for companies that deal with  export and/or import of goods to reduce risk but also to improve the working capital. Before going into the working capital part first let us refresh the theory.

If you are an importer of goods you would like to be sure the goods you will receive are the same as the goods you ordered. How can you be sure that the exporter sent you the right quality of goods and the right quantity, or that he sent them at all? One of the possibilities you have to reduce that risk is to pay after receiving the goods. If the quality and the quantity do not match with what you ordered, you simply do not accept the goods and do not pay the invoice.

At the same time the exporter of goods is worried that after sending you the goods, the invoice will remain  unpaid after the agreed payment period. What if the client does not accept the goods in the harbor? He would then have to arrange for new transport to return the goods or try to find new clients in a short period of time.

There is a lot of risk for both parties especially when they do not know each other very well or if they are located on different continents.

Letter of Credit

In this case a Letter of Credit could be a solution. With a Letter of Credit you make agreements with the exporter about the quality and the quantity of the goods that you buy, and how, when and where the goods will be shipped to.  Only if all terms and conditions of the Letter of Credit have been met the bank will pay the invoice. A lot of paper work will be part of the agreement for instance a Bills of Lading, a commercial invoice, a certificate of origin and an inspection certificate. As an additional security, the exporter can have the Letter of Credit confirmed by his bank.
In a nutshell this is the basic of how Letters of Credit (L/C) works.

Working Capital

Now you can ask the question how could this improve your working capital?

Firstly you will have more security that the payment will be made, therefore the risk of nonpayment will be reduced.

With trade finance you could also set up a line of credit based on your security and overall financial situation.

For the importer, he can finance the gap between paying the exporter and selling the goods to a buyer or use it for manufacturing purposes.

For the exporter, he can fund the gap between selling the goods and receiving payments from the buyer.

If there is not enough equity or there are no sufficient credit lines available, there is another option. Transaction Finance, hence the goods you will sell. [Export L/C] are used to fund [collateral] the buying of these same goods [Import L/C] This is called a Back to back L/C.

There could be a fly in the ointment, however! What happens when there is a mistake made in the paperwork? If this is a small mistake both parties would agree the transaction will go forward. But if during shipment the prices of the goods drop the importer will maybe not be very collaborative and will grab this opportunity to refuse the goods and not to pay the invoice!

Since the credit crisis the use of L/C’s went through the roof. If you need consultancy advise on this topic, drop us a line!

Olivier Werlingshoff - editor treasuryXL


Olivier Werlingshoff 

Group Treasury Director




More articles from this author:

How can payments improve your working capital?

Managing cash across borders

How to improve cash awareness without targets

Basel III and the impact on cost of hedging

| 30-3-2017 | Arnoud Doornbos | Treasury Services |

Corporates will save hedging costs and administrative costs significantly if they shift their hedging activities to exchanges such as CME (Chicago Mercantile Exchange).
In the summer of 2007 a large number of defaults on U.S. mortgage loans did arise. The banks were hit hard by the global domino effect that resulted. A major financial crisis which was followed by an economic crisis led to a revision of the capital requirements of Basel I and Basel II.

New Basel III

The core of Basel III is that many banks have to hold more capital and liquidity to their outstanding investments than they used to in the past. The rules are implemented as from 2013 and should eventually be fully effective in 2019.

Basel III will be a huge challenge for banks in the coming years. The impact on the pricing of financial products and transactions between banks and their clients will be significant.
Since July 2008, the Basel Committee for Banking Supervision has been working on Basel III for all banks worldwide. The European Commission has introduced three Capital Requirements Directives which contains concrete actions and requirements in terms of risk, capital and liquidity management within a bank. The new requirements, part of Basel III, aim to improve the quality and level of capital reserves of banks.

The capital requirements of certain products have increased and banks are encouraged to create additional capital buffers during good economic times so that they are better positioned to absorb losses during periods of economic stress.

Impact of Basel III on liquidity management

Besides sharpening the capital requirements Basel III has a major impact on liquidity management. The new liquidity standards are based on a stress test. In addition Basel III also introduces new long-term liquidity standards that reduce the mismatch between the maturities of assets and liabilities.
Banks will have to increase their reserves sharply in the coming years. Previously, banks only had to keep 2 % capital to their outstanding investments. Now with Basel III this capital requirement has been increased to 7 % (4.5 % hard buffer and an additional 2.5 % margin in bad times) . As a result banks will probably not distribute their profits in the coming years but will add to their capital buffers. Furthermore many banks will have to issue new shares in order to attract extra money in order to meet the new demands.

Counterparty risk

Within Basel III it has been determined that capital must be held for the credit risk on a counterparty a bank is exposed to in OTC derivatives or equity financing transactions. In addition, market participants are encouraged to take one central counterparty (clearing houses) for OTC derivatives. Any time a bank takes a risk against another party the probability of default exists. To offset this concern, and to support on-going stability within the interbank market, banks have long emphasized the importance of measuring and managing counterparty risk. Now banks have becomes noticeably less comfortable trading with other counterparties including other banks.

The recent deterioration in credit ratings that has hit many U.S. and European banks has led to a heightened sensitivity over counterparty risk. These apprehensions may not be voiced directly, but they become evident when front office trades that would have cleared in the past, no longer do because credit lines have been reduced. There is increasing focus on limiting exposures, even among global banks. And that is starting to affect the way we do business.
CVA (Credit Valuations Adjustment) desks have grown in popularity, as banks seek more effective ways to manage and aggregate counterparty credit risk.
The market has changed now in terms of how counterparty credit risk was calculated. Now, no client is assumed to be truly risk free. Different prices are now expected for different clients on that same interest rate swap, depending on variables including the client’s rating and the overall direction of existing trades between both parties.
On all new interest rate, FX, equity, or credit derivatives, CVA desks price the marginal counterparty risk for inclusion into the overall price charged to the client. CVA is a highly complex calculation.

CVA looks at default through the spread of the counterparty. A swap facing a single B credit that trades at 1200 in CDS is going to be charged a lot more than the same swap facing a AA counterparty. The CDS spread is normally a core input of CVA pricing.

What we see in practice is that in the manual process, the CVA desk team of a bank often passes along suggestions to the salesperson for improving the credit risk in a trade and enabling the sales person to offer the trade at a lower credit price. Examples of that would include improving the collateral agreement with a client, or inserting a break clause.
In the traditional CVA approach, a bank accepts a new trade, takes a fee and uses that fee to buy good hedges for all the risks in that trade. These hedges should eliminate all of the bank’s risk, but this is not necessarily the case once Basel III is taken into account.

Basel III does not recognize all types of hedges that the bank might want to use. Therefore the regulatory capital for certain trades will not be zero, even if the bank has used the full CVA fee to hedge all its risks.
The first impact Basel III has on CVA desks is on pricing. Pre-deal pricing needs to be reviewed to ensure the costs of imposed regulatory capital are covered. If not, additional pricing may need to be added. And the decision on which risks are efficient to hedge also becomes affected not just by strategic or business reasons, but also by the regulatory capital impact.
As part of Basel III’s updated regulatory capital guidelines, a new element has been added: V@R on CVA. Regulators have specified very precisely how the underlying CVA must be calculated for this charge. Banks will therefore need to decide whether to adjust their pricing and balance sheet CVA to match the Basel III rules, or to use different CVA calculations for pricing and regulatory purposes.

EMIR / Dodd-Frank

The Dodd-Frank / EMIR financial reform bill gives a new set of derivatives rules that either will clean up the market or send the world spiraling off the deep end. The truth is probably somewhere in between. The crux of the derivatives regulation is the requirements that standardized swaps be centrally cleared and traded on a Swap Execution Facility, or SEF. This moves derivatives from bilateral agreements between bank and client to centrally cleared products where credit risk is no longer bank-held, but is centralized in a clearinghouse where daily margin is managed. Once clearing is in place, customers no longer are locked into a single dealer, long and short positions can be netted, and SEFs can begin to match buyers and sellers without having to worry about the credit lines of each counterparty or dealer.

This will begin the migration of the derivatives business from a principal-based OTC market toward an agency-based bid/offer SEF market.

Treasury Services’ analysis:

  • Hedging is penalized decreasing the liquidity in the markets leading to increased costs to hedge financial risks for corporations. This is further emphasized by the penalization of the interbank markets through requirement of more capital, and additional constraints on liquidity on interbank transactions.
  • There will also be an increase in administration costs for corporates costs due to EMIR.
  • Corporate credit by banks is penalized: More capital is required in general. For back-up facilities on commercial paper programs it is required that banks will have to have 100% of liquid assets whilst these facilities are fully undrawn. The cost of carry will obviously be invoiced to the client. The ability of the bank to borrow long term will determine the availability of back-up facilities.
  • Restrictions in maturity mismatch (including for repayments) are introduced. This may mean that the risk of borrowing short term to finance long term investments will be transferred to the corporate sector.

The advantages of the OTC market compared to exchanges has become questionable. High cost savings can be achieved by shifting your hedging activities to exchanges such as Chicago Mercantile Exchange (CME).
Shifting hedging activities to an exchange such as CME requires changes in your risk management function. This supplies the possibility to bring the cost of hedging back in your control.


Arnoud Doornbos

Associate Partner

Experts talk about a DIY Approach to Corporate Borrowing

| 07-11-2016 | Douwe Dijkstra, Lionel Pavey |



Last week we came across an article about DIY Corporate Borrowing ( The author stated that: “A do-it-yourself (DIY) credit application using publicly available information can help corporations better understand how they are seen by lenders and cuts the risk of financing not being available when it’s most needed.” We have asked our cash management experts Douwe Dijkstra and Lionel Pavey to give us their opinion on this approach. 



douwedijkstrarondDouwe Dijkstra
“I would like to react to the paragraph: “Services, such as cash management, trade finance and other fee-based services, require little or no equity for the bank to sell them and can appear to be much more profitable. From time to time a bank will instruct its sales force to push the products and services that require less capital and restrict sales of capital intensive ones such as loans.”

In my opinion banks nowadays already include exclusive provisions in their loan documentation for additional side business when providing finance to corporates. As a consequence you find yourself condemned to the cash management solution of a bank which is far from efficient for your purposes i.e. they do not have a presence in your area or one of the areas where you are active. The same is true for the “no further indebtedness” clauses in their loan documentation that prevents you, as a treasurer, selecting the best fitting financial product for your company. As an interim treasurer working for several private equity owned companies I am often faced with these restrictions. Regularly private equity companies have already signed the loan documentation without properly assessing side business terms in the contract. ”

lionelrondLionel Pavey
“Money is a commodity that is fungible – it is homogeneous and can be exchanged or replaced by a similar unit of currency and we would be indifferent to this change.

However, loan documentation is certainly not homogeneous – a quick scan through the documentation of different lenders will show different terms and conditions.

A DIY credit application therefore requires the existence of a standard set of documents. There are certain examples, such as the Loan Market Association, who do attempt to make standard documentation.

Up to now banks have traditionally been the suppliers of credit to companies, though there is no law or reason stating that they have the sole right to do this. To open up the loan market to third parties would require clearly defined documentation, along with criteria that must be met to engage with the market – detailed accounts that have been signed off and approved by independent auditors etc.

Lenders would have to submit their audited figures within an agreed timeframe so as not to be in default on their loans.

If such a market did come into existence and it was truly open to all contributors, it would also lead to fair greater transparency of the pricing policy that lenders use. The price of debt for each and every level of credit rating could be observed, together with implied premiums for country, industry etc. This is the opaque area where banks have a clear advantage – they have their own internal guidelines and pricing mechanics that no one else gets to see. The pricing should be more transparent – this would enable potential borrowers to have greater insight into price discovery which is a cause of concern for many funding issues as, for many companies, it is difficult to passively see what the potential price of debt for them would be.

An opening up of any financial market should be welcomed and make it easier for other potential lenders to see what risks the rest of the market are prepared to accept and also price changes. This would then allow companies to better manage their external relationships – they can separate their loan relationships from their core banking relationships.”