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

 

Towards a central bank digital currency?

| 06-08-2019 | Carlo de Meijer | treasuryXL

Since Facebook announced its plans to come up with their own digital currency named Libra, a heated debate has risen about whether central banks should issue their own digital currency.

Central banks worldwide have expressed their worries about Facebook’s plan. According to them the prospect of a tech firm (and may be also others in the future) with billions of users launching its own money potentially poses a threat to existing fiat state currencies and especially to monetary stability.

Long-time sitting at the side-lines, this plan may accelerate the idea of a central bank digital currency (CBDC). Though there are no real plans (yet), are some strong arguments for central banks to start issuing their own digital currency.

This however raises a number of questions such as: What sort of digital currency?; What would be the main arguments? What role should banks play in this process? And, what would be the impact on financial stability?

Central banks counterbalancing Libra

Central bank are seriously watching the emergence of a new global digital currency called Libra, introduced by Facebook (see my Blog: Facebook and Libra: a global digital currency, 1 July 2019). The birth of Libra thereby serves as an “alert” for central banks and regulators.

There is growing belief that if Libra could be successfully launched, it would challenge central banks’ monetary sovereignty, posing a long-term threat to central banks control of money. Any role for Libra beyond the payment function could bring changes to the rules of the global monetary system, and regulators should pay close attention to that possibility.

“From the government’s perspective, we pay more attention to its influence on financial services, monetary policy and financial stability.”

Accelerating the launch of their own digital currencies by central banks could be a counterbalance.

Reactions

The initial cautious stance towards a central bank issued digital currency, ranging from wait-and-see to very negative, has firmly changed. Central banks and governments from all over the world as well as international financial institutions like the IMF and BIS are now sounding a much more positive tone.

IMF

It is interesting to find that already last year (November 2018) the International Monetary Fund (IMF) started to examine the potential innovative nature of digital currencies and has supported CBDC proposals more positively. Christine Lagarde, at that time Managing Director of the IMF, urged central banks to consider CBDC since they could satisfy public policy goals, including financial inclusion, security/consumer protection, and privacy in payments.

BIS

While just a few months ago, Augustín Carstens, the general manager for the Bank for International Settlements (BIS), was still questioning the value of central-bank-issued digital currencies, he recently acknowledged that central banks will likely soon need to issue their own ones.

Carstens warns that “big techs have the potential to become dominant” in this area thanks to network effects. Further, the arrival of such products “might just be around the corner if there is clear evidence of demand from the public”.

 “And it might be that it is sooner than we think that there is a market and we need to be able to provide central bank digital currencies. If Facebook and big tech companies get their way, however they may have to.” Augustin Carstens

BIS is now supporting the many central banks’ efforts to research and develop digital currencies based on national fiat currencies. At the very least, the BIS concludes in its recent report, new “comprehensive” public policy is needed to “respond to big techs’ entry into financial services so as to benefit from the gains while limiting the risks.”

The potential implications of such a change towards central bank digital currencies for the stability of the global financial system however aren’t entirely clear, according to the BIS.

ECB

Though not taking an official position, a European Central Bank (ECB) official has come out generally in favour of wholesale central bank digital currencies (CBDCs).

Vitas Vasiliauskas, a member of the Governing Council of the ECB and chairman of the board of the Bank of Lithuania, said the question is not if but whether CBDCs should be retail, wholesale, or both. A retail CBDC would be available for the general public, while a wholesale version would be restricted to serve a limited circle, mostly financial institutions. In between these two types, “multiple theoretical sub-models also exist,” he said.

PBoC

The People’s Bank of China (PBoC), the country’s central bank is accelerating its efforts to introduce a government-backed digital currency, aiming at “securing a cutting-edge position in the global cryptocurrency race”. The central bank is organizing market-oriented institutions to jointly research and develop a central bank digital currency and the program has been approved by the State Council.

“A digital currency issued by the central bank can improve the efficiency of monetary policy, and help to optimize the payment system.”

China’s monetary authority identifies the nature of digital currency as “a substitute for cash”, rather than a speculative instrument. The use of cash is declining in China amid booming digital payment systems.

The central bank digital currency could be a new monetary policy tool, or an investment asset that carries an interest rate to satisfy investors’ demand for value. It might also be used as a reference for bank interest rates on deposits. The Chinese digital currency also could be used domestically. But “everything is just under discussion”.

Why CBDCs?

There are various arguments raised to issuing central bank issued digital currency based on DLT. The main are described below.

Towards a cashless society

One of the reasons mentioned is that in the Western world a growing number of people do not use cash anymore. Physical payments are thereby gradually replaced with electronic payments. CBDCs could provide a safe, liquid payment instruments to the general public. They have the potential to reduce cash handling costs since all the transactions can be made using a digital representation of money and are traceable.

…. and a formal based economy

A shift in central bank money from cash (physical money) to digital currency is another way to shift the economy from being informal-based to formal-based so that the economy becomes more tax-based, transparent, and efficient. This is especially relevant for emerging markets.

Increased financial inclusion

Another motivation  for especially emerging economies regarding CBDC proposals is financial inclusion. In many of these countries a large number of people are unbanked and/or without access to commercial banks and the internet and thus excluded from conventional banking services. CBDC might promote digitization of the economy and, thus, economic and social inclusion.

More effective monetary policy

Shifting from cash to digital currency through issuing CBDC may enhance the effectiveness of monetary policy (such as a negative interest rate policy under the effective lower bound) because of limiting the scope of cash substitution that could emerge to avoid a negative interest rate.

Implementing CBDCs can allow new monetary policy tools to be used. Alternatively, CBDCs can be used as a tool to increase aggregate demand by making ‘helicopter drops’ of newly created CBDCs to all citizens, making it easier to meet the central bank’s monetary policy target of price stability.

Safer and more effective financial system

And there are the efficiency and financial stability gains to be get from CBDC. CBDC has the potential to improve the existing wholesale financial systems—including interbank payments and settlement systems, delivery versus payment systems, and cross-border payments and settlements systems.

Allowing individuals, private sector companies, and non-bank financial institutions to settle directly in central bank money (rather than bank deposits) may significantly reduce the concentration of liquidity and credit risk in payment systems.

This in turn could reduce the systemic importance of large banks. In addition, by providing a genuinely risk-free alternative to bank deposits, a shift from bank deposits to digital cash may also reduce the need for government guarantees on deposits, “eliminating a source of moral hazard” from the financial system.

Foster fintech sector

The use of CBDCs may promote a technological environment and foster the fintech sector. This is especially relevant for emerging economies. Those economies may find it difficult to develop banking systems and capital markets that are comparable to those in advanced economies. Fintech services are new and innovative.

Encourage competition and innovation

The regulatory framework would make it significantly easier for new entrants to the payments sector to offer payment accounts and provide competition to the existing banks. It would also reduce the need for most smaller banks and non-banks to run their payments through the larger banks (who are able to set transaction fees at a level that disadvantages their smaller competitors).

What sort of central bank digital currency?

When discussing the options of central bank digital currencies we can differentiate proposals into retail CDBC i.e. targeted to the general public and wholesale CBDC issued only for financial institutions. And there are multiple in-between types that may have characteristics of both retail and wholesale.

Retail CBDC

A retail CBDC is one that will be issued for the general public. Retail CBDC based on DLT has the features of anonymity, traceability, availability 24 hours a day and 365 days a year, and the feasibility of an interest rate application.

The retail proposal is relatively popular among central banks in emerging economies, mainly because of the motivation to take the lead in the rapidly emerging fintech industry, to promote financial inclusion by accelerating the shift to a cashless society, and to reduce cash printing and handling costs.

Wholesale CDBC

A wholesale CBDC is for financial institutions that hold reserve deposits with a central bank. It could be used to improve payments and securities settlement efficiency, as well as to reduce counterparty credit and liquidity risks.

A value-based wholesale CBDC would replace or complement reserves at the central bank with a restricted-access digital token. A token would be a bearer asset, meaning that during the transaction the sender would transfer value to the receiver, without intermediaries.

This would be something fundamentally different from the current system in which the central bank debits and credits the accounts without transferring actual values.

The wholesale CBDC is seen as the most popular proposal among central banks because of the potential to make existing wholesale financial systems faster, inexpensive, and safer. The Bank of International Settlements (BIS) also shares the view that wholesale CBDC could potentially benefit the payments and settlements systems.

Some experiments have been already conducted or examined by central banks since 2016—such as those in Canada called “CADcoin” under Project Jasper, Singapore Project Ubin, Japan-Euro Area Project Stella, Brazil, South Africa Project Khokha, and Thailand (Project Inthanon). (See my earlier blogs: Blockchain and Central Banks: A Tour de Table Part I and II, 3 and 9 January, 2017).

Retail versus wholesale CBDC?

Compared to emerging economies, central banks in advanced economies are not enthusiastic about retail CBDC. And that is not surprising. Many central banks do not wish to create competition between central bank money private sector money, taken into account the limited potential benefits from using retail CBDC.

A retail CDBC would be a step too far (or too early) for them. If a central bank issued a digital currency whereby everyone (including businesses, households and financial institutions other than banks) could store value and make payments in electronic central bank money (the r-CBDC variant), this could have wide-ranging implications for monetary policy and financial stability.

Wholesale Central Bank Digital Currency would bring a number of important efficiencies. Besides their retail payments and settlements systems are already highly efficient, almost real time, and always available. Most citizens are banked, while the use of cash in most European countries – with the exception of Sweden and Norway – is still rather high (and not declining in the same speed).

Moreover, wholesale CBDC technology would allow linking to other platforms. Directly linking securities or FX platforms to cash platforms could improve the speed of trades and eliminate settlement risk. Settlement on OTC markets, as well as for syndicated lending and trade finance could speed up considerably if linked live to an instant wholesale CBDC system.

Wholesale CBDC may also simplify (cross-border) payment infrastructure, strongly reducing the number of intermediaries involved. This may improve efficiency and security, minimise liquidity and counterparty risks and reduces cost.

Deploying DLT technology would also allow “smart” features to be added to wholesale CBDC, including earmarking funds, limiting their use in time and place, applying conditional interest rates and others. Such smart features would allow central banks to explore new and powerful operational monetary policy tools, such as tailor-made interest rates.

Finally. real-time monitoring and better track-and-trace options on a unified platform should facilitate both anti-money laundering efforts by banks and supervision over those efforts.

Coordinated CBDC approach

This wholesale approach is a likely first step towards more universal adoption of CBDCs. It is less disruptive and makes global payments cheaper, faster and more secure. But who should take the initiative to build the wholesale CBDC?

Only central banks have the mandate to issue a digital currency or token and call it legal tender. They however lack extensive experience and resources needed to build and maintain such an infrastructure and, build a compliance apparatus to supervise clients and transactions.

The private sector, on the other hand, has the necessary experience and resources to do this. Next to that, commercial banks also have an incentive, as regulation is becoming ever more stringent (KYC, AML), and makes it more costly to maintain a presence in payment systems in multiple countries.

Moreover, the current international payment system, based on correspondent banking, creates various costs such as KYC and handling costs of all banks involved. There are also delays due to opening hours in different time zones while liquidity is trapped in pre-funded nostro-accounts. A single cross-border 24/7 international direct payment and settlement system therefore is very attractive for them.

In order to build a successful wholesale CBDC, one needs the private sector’s experience and the central banks, thereby taking away the various counterparty risks. Moreover, jurisdictional differences need to be harmonised. So international public-private partnerships make sense.

Though this seems controversial, one should keep in mind that the existing monetary system is already a public-private partnership. While central banks determine monetary policy and monitor financial stability, commercial banks actually create most of the money by lending. Central banks (and other government agencies) in turn license and regulate them.

The way forward

Up till recently, not many central banks so far have found strong advantages of issuing their own digital currency at this stage because of several technical constraints.

The potential launch of Libra however has been an important wake-up call for a large number of central banks.

Given that blockchain technology has been progressing fast in the settlement and payment areas (as well as DLT), central banks may now see incentives to increase their interest in wholesale CBDC proposals and consider actual implementation seriously in the near future.

Wholesale CBDC however will still have to compete with upgraded legacy systems. Both central and commercial banks should therefore take a cautious approach when building completely new alternatives. Experimental wholesale CBDC that are cross-border from the start and involve multiple commercial and central banks, should have the biggest chance of success.

A retail CBDC however may be “a faraway goal” because of the potential adverse impact on commercial banks by promoting a shift of retail deposits from commercial banks to a central bank.

 

 

Carlo de Meijer

Economist and researcher

 

Dit zeggen Nederlandse bedrijven over hun renterisico

| 02-08-2019 | ICC Consultants | treasuryXL |

Recent heeft ICC een rente-enquête uitgevoerd onder haar relaties. In deze enquête werd één prangende vraag gesteld: Waarom dekt u uw renterisico (nog) niet in?

Hieronder ziet u hoe deze vraag beantwoord is:

Circa de helft geeft aan op dit moment geen renterisico te hebben. Deze groep bestaat uit bedrijven die geen financiering hebben (19%) en organisaties die hun renterisico al (deels) ingedekt hebben (32%). ICC denkt overigens dat dit laatste percentage aanzienlijk hoger ligt dan het landelijk gemiddelde omdat het hier ICC relaties betreft. Meerdere bedrijven hebben de afgelopen periode gebruik gemaakt van de prachtige, historische lage, renteniveaus.

De overige 50% van de respondenten heeft wel een renterisico en de meningen binnen deze groep zijn zeer verdeeld. Voordat we hier verder op inzoomen willen we u er op wijzen dat de swaprentes recentelijk nog weer verder gedaald zijn. De 10-jaars swaprente staat nu op ca. 0,2%. Aangepast aan de modaliteiten (bijv. 3-maands Euribor en 3% aflossing per jaar) van uw onderliggende financiering zou de ‘kale’ swaprente zelfs rond de 0,1% uitkomen. Tel daar gemakshalve een kleine 0,2% bankmarge bij op en u kunt uw rentelasten voor de komende 10 jaar mogelijk fixeren onder de 0,3%.​

ICC geeft hieronder een paar kanttekeningen bij een aantal gegeven antwoorden:

‘Wij willen wel (deels) indekken, maar pas als het Euribor tarief daadwerkelijk gaat oplopen’

Het is een keuze, om te willen wachten en pas te acteren bij daadwerkelijk oplopende Euribor rentes. U krijgt echter, juist nù, de opportunity om zekerheid te verkrijgen van langdurige zeer lage rentekosten. Bovendien is de kans reëel dat de lange rentes (al) zijn opgelopen, wanneer u in de toekomst van een variabele rente naar een gefixeerde rente(last) wilt gaan.

‘Wij dekken niet in, omdat ‘iedereen’ zegt dat de rente nog heel lang laag blijft (geen urgentie)’

Dit zou goed kunnen, maar een aantal ontwikkelingen wijst op meer inflatie in de toekomst. De druk op overheden om meer uit te geven neemt toe en de arbeidsmarkt is krap waardoor de lonen stijgen. Ook neemt het protectionisme toe, wat kan leiden tot hogere importtarieven en minder concurrentie. Als er eenmaal sprake is van (een) hogere inflatie(verwachting), dan zal de ECB daar dankbaar gebruik van maken en de rente gaan verhogen. Hogere rentes betekent voor banken, dat het aantrekkelijker wordt om meer krediet te gaan verstrekken. Terwijl de ECB ‘monetaire munitie’ moet opbouwen – o.a. via renteverhogingen – om daarmee een volgende crisis te bestrijden.

Daarnaast bent u vermoedelijk geen rentespeculant. Als u als ondernemer voor continuïteit gaat, dan is het zo lang mogelijk zekerstellen van de laagst mogelijke operating costs misschien wel een beter beleid, dan het nastreven van de allerlaagste rentekosten op enig moment.

‘Wij willen wel (deels) indekken, maar onze bank werkt niet mee’

De redenen die wij hier voor horen zijn divers en verschillend per bank. Enerzijds heeft dit te maken met de cliëntkwalificatie en de verbonden Mifid-wetgeving, anderzijds met de (vereiste) aanwezige kennis binnen het bedrijf. ICC wordt dikwijls gevraagd om (vooraf) de (on)mogelijkheden hiervan te bekijken; met inbreng van onze kennis & ervaring weet u daadwerkelijk hoe ver u kunt komen en is er vaak meer mogelijk bij uw bank.

‘We dekken niet in omdat we niets meer met renteswaps te maken willen hebben’

Dit is een reden, die we vaak horen. Slechte ervaring vanuit het verleden en daarom doe ik het maar niet meer. Opgemerkt hierbij, dat de voor- en nadelen van renteswaps nu veel beter bekend zijn en u kunt zich hierover laten adviseren. Des te meer een opvallende reden, aangezien men in het verleden ‘massaal’ de rentes afdekte op een renteniveau van rond ca. 5%, terwijl de rentemarkt nu nagenoeg op 0% staat.

Sowieso is het risico op grote negatieve waardes op de huidige lage renteniveaus natuurlijk veel kleiner dan destijds in de periode 2006-2008. Daarnaast zijn er andere mogelijkheden om renterisico’s af te dekken, dan sec een renteswap. Hier liggen vaak interessante mogelijkheden, met meer flexibiliteit en hierdoor voor meerdere bedrijven een optimalere afdekking van het Euribor risico.

ICC RESEARCH

Ongetwijfeld leven er bij u meerdere overwegingen om uw renterisico’s (verder) wel/niet af te dekken. Het advies van ICC is om in ieder geval de renteontwikkelingen goed te volgen. U kunt dit doen door regelmatig de publicaties van ICC Research te lezen. Vraag hier uw gratis proefperiode aan.

Wilt u meer informatie over het afdekken van uw renterisico, neem dan contact op met ons via telefoonnummer: 030-2328200 of via email: [email protected].

Auke MiddelAuke Middel
Senior Consultant Market Risks | ICC Consultants

Blockchain een hype? Training voor Financials

| 01-08-2019 | by treasuryXL | Kendra Keydeniers

Training: Blockchain voor Financials

Is blockchain een hype of gaat het de wereld echt drastisch veranderen? Wat is de gigantische impact van blockchain op de toekomst van uw financiële functie? Ontdek in twee dagen wat blockchain is, hoe u het toepast en hoe u ermee begint in uw eigen functie, organisatie of bij uw klanten

Uniek: Ontvang waardevol advies op uw eigen Blockchain Case

Breng uw eigen blockchain-use case in en deze wordt al tijdens de training besproken en beoordeeld op haalbaarheid. Ontvang bruikbare tips en adviezen waarmee u direct na de training verder kunt.

In deze training onthullen blockchain-experts Paul Bessems en Jeroen Perquin de nieuwe wereld van blockchain en geven u daarbij vele aanknopingspunten om direct met blockchain aan de slag te gaan binnen uw organisatie of netwerk. Paul en Jeroen illustreren de theorie met vele voorbeelden uit hun eigen praktijk waardoor de potentie van blockchain direct duidelijk wordt. Schrijf direct in.

Inclusief 2 E-learning modules

Bij dit programma ontvangt u 2 E-learning modules die uitstekend aansluiten op uw training. Haal alles uit Blockchain voor Financials en behaal 4 extra PE Uren.

Online modules Blockchain voor Financials:

  • Wat is Blockchain?
  • Blockchain in de praktijk
 Periode 2 dagen
 Investering. 1895 euro ( excl. BTW )
 Certificaat
14 PE-uren klassikaal + 4 PE-uren E-learning
 Datum / Locatie
17 en 18 december 2019 
Hotel Mercure Amsterdam Airport

27 en 28 mei 2020 
Randstad

22 en 23 september 2020 
Randstad

Uw voordelen
  • Nieuw | Wat is blockchain en waar gebruikt u het voor?
  • Disruptief | Wat zijn de gevolgen voor uw functie/organisatie/netwerk?
  • Begin! | Hoe start en (bege)leidt u een blockchainproject?
  • Design | Ontwerpoefening met de Harvard Case Methode
  • Praktijkgericht | Ga naar huis met uw eigen aangepaste use case
Onderwerpen
  • Wat is Blockchain?
  • Het verhaal achter Bitcoin
  • Blockchain in de praktijk
  • Data Economics
  • Toekomst van Blockchain
Boeken en materialen

Alle deelnemers ontvangen:

  • Het boek ‘Blockchain Organiseren voor managers: een andere kijk op managementinnovatie’ van Paul Bessems en Walter Bril.
  • De mogelijkheid tegen gereduceerd tarief community member te worden met toegang tot blockchain experts en het Kenniscentrum Blockchain Organiseren met artikelen, scripties, onderzoeken etc.
Voor wie?

Dit programma is specifiek ontwikkeld voor financials zoals controllers, financieel managers, financieel adviseurs en financieel directeuren die betrokken zijn bij (management) innovaties zoals blockchain en digitalisering.

Schrijf vandaag nog in!

 

 

 

BELLIN Launches SWIFT g4C Product Offering

| 30-07-2019 | BELLIN |

BELLIN, a global leader in providing treasury software and services, has successfully integrated SWIFT gpi for Corporates (g4C) in its tm5 treasury management system and completed the pilot and Early Adopter phase. With the BELLIN SWIFT product offering extended, all BELLIN clients can now benefit from fast cross-border payments as well as tracking directly in the tm5 system.

tm5, BELLIN’s treasury management system, has supported SWIFT g4C technology since as early as April, making BELLIN the first of the TMS provider Early Adopters with a customer live on g4C. SWIFT has now officially launched gpi for Corporates, enabling all users of the BELLIN SWIFT Service to consider benefiting from transparency and traceability for cross-border payments. Corporates need their own SWIFT BIC to make use of the SWIFT g4C technology. They register their BIC with gpi for Corporates and connect financial institutions that offer g4C. Started Monday, June 24, 2019, the entire SWIFT community can register their BICs for the new SWIFT g4C technology.

SWIFT g4C from pilot to live

“All of us, our clients, BELLIN and SWIFT, are bound by the desire to advance corporate payments. This is why we have worked hard in a concerted effort to implement SWIFT g4C technology,” explains Karsten Kiefer, Product Manager SOLUTION MANAGEMENT at BELLIN. “With SWIFT g4C, corporates will benefit enormously from speed, transparency and comprehensive information with cross-border payment processing. The obvious advantages will make for an immediate success story.”

The BELLIN SWIFT Service enables BELLIN clients to receive their own BIC and to gain access to the SWIFT Network as a member of the Standard Corporate Environment (SCORE). BELLIN takes care of the BIC application, connects the company to the SWIFT Network and guides the client through onboarding and configuration. The BELLIN SWIFT Service has been part of BELLIN’s portfolio since 2013, making BELLIN the very first treasury management system provider with a service of this kind. Today, over 160 customers use the BELLIN SWIFT Service.

Interview with Karsten Kiefer on the SWIFT g4C integration in BELLIN’s treasury management system and the benefits for corporates

About BELLIN

BELLIN is the global leader in technology for corporate banking and treasury. We provide solutions for the financial sector, catering to a range of clients from large multinationals to SMEs and banks. Founded by a treasurer, BELLIN has been championing innovation and out-of-the-box thinking since 1998. With the treasury software tm5 as the centerpiece, BELLIN makes a fundamental difference by offering solutions that zero in on the relationship between corporates and banks and cover everything from payments to FX, cash and risk management. BELLIN is an international company with offices on four continents, powered by a trailblazing fintech spirit and yet firmly rooted in the heritage of German craftsmanship and engineering. BELLIN delights 500 clients and over 80,000 users around the globe.

Give your career a boost and become a Register Treasurer

| 29-07-2019 | by Kendra Keydeniers |

Over the last weeks we shared blogs with profiles of Register Treasurer (RT) graduates with their motives, experiences and career paths. The blogs give you a better insight in the type of treasurers that are “RT material”.

You can read the following RT stories:

Jarno Timmerman | Treasury Director at Nike

Michel van Baardewijk | Treasurer at Vestia

Richard Blokland | Corporate Treasurer at NewCold

Mathieu Ummelen | Interim Treasury and Corporate Finance Professional

The RT program brought all the above graduates to a higher level in their career as Register Treasurer.

Executive Treasury Management & Corporate Finance programme

The post-graduate Executive Treasury Management & Corporate Finance programme combines two finance disciplines: Treasury Management and Corporate Finance. These disciplines largely overlap and are inextricably connected.

This post-graduate executive programme has now been running for more than 20 years at Vrije Universiteit Amsterdam. It is a unique programme both in the Netherlands and abroad.
The programme will be delivered entirely in English to appeal to the increasingly large community of non-Dutch-speaking finance professionals in the Netherlands.

Participants successfully completing this post-graduate executive programme will be awarded with the title of Registered Treasurer. This title is well-known and widely recognized within the treasury professionals’ community.

The curriculum consists of 6 modules, each of which covers a clear sub-discipline in Treasury Management and Corporate Finance. Each module comprises approx 8 lecture days on Thursdays (from 15:30 until 20:00). It is an intensive and efficient 18-month programme.

The post-graduate Executive Treasury Management & Corporate Finance programme is a strategic partner of the Dutch Association of Corporate Treasurers (DACT). Partners in the programme are KPMG, Orchard Finance, PwC, and Zanders Treasury & Finance Solutions. Senior affiliates are programme lecturers.

Exemptions apply to alumni of Dutch RC and RA programmes.

More info here

Corporate Treasury have a problem and this is why…

| 23-07-2019 | by Pieter de Kiewit |

Cost savings created by good treasurers easily exceed the sum of salaries of their team. They can help open doors that otherwise stay closed for their business colleagues and they can help avoid risks. Then why do they have this modest seat at the table of CFOs and are they often not considered for succession of her/him? Why are SMEs complaining about the lack of funding opportunities, when treasurers have them available? Why are Basel regulations made by bankers and politicians, where are the corporate treasurers? Why does treasury education not have a more prominent place in education? Why do bankers earn the bigger bucks? Corporate treasury has a PROBLEM!

The non-treasurers (CFOs and business owners) often do not know, so they do not consider this a problem. I think they should, given my introduction. The treasurers I meet often experience the problem: they want to be educated, make career progression, be involved in business and have better salaries. Why do controllers or non-financials not encounter this issue, or at least in a lesser degree?

Based upon my many interview notes and the first results of the dataset of the Treasurer Test I have a first hypothesis (there will be more): the personality of people working in treasury. A Big5 personality assessment has been done in a treasury population of 100. What I see is that treasurers, on average, are easily as driven as the general population. That should be a proper foundation. Where they score substantially different is in two aspects:

  1. They do not make contact quickly
  2. They are not focused on convincing other people.

The two obvious solutions are bringing people with a different personality into the treasury field and stimulating the current population to speak up. As recruiters we hope to contribute by bringing (for example) bankers into corporate treasury. Bankers often show a different personality profile. Furthermore I think we should not try to change the personality of the current population, but skills training will most definitely help.

Do you see the problem and want to step up? I hope so.

 

 

Pieter de Kiewit
Owner Treasurer Search

 

Why Michel decided to explore the World of Treasury

| 22-07-2019 | by treasuryXL | Kendra Keydeniers

 

 

Our next RT story is the one of Michel van Baardwijk. He graduated as a Register Treasurer (RT) in 2017. Michel is specialized in the Public Sector and faced many challenges working at Vestia as Treasurer.

Vestia, formally ‘Stichting Vestia’ is the largest public housing corporation in the Netherlands, which is headquartered in Rotterdam. The corporation owns (and rents out) about 78,000 houses and 8,000 other “rentable units”.

Vestia received media attention in 2011 and 2012 on the topic of interest derivatives. This attention continues until today. The follow up and the consequences of the transactions made in the past determine most of Michel’s treasury activities.

 

 

  1. What for you was the main reason to start a career in treasury?

    Actually my career in treasury was not premeditated. I liked the courses corporate finance during my studies business economics/econometrics in Tilburg, but my first jobs at Philips and the municipality of Rotterdam had nothing to do with treasury. Later when I worked as a financial manager or controller treasury was one of the many elements of the job, until the take-over by Vestia in 2011. In the re-organisation of 2013 I applied for Treasury and I got the job.

  2. Why did you start with the RT program?

    Because the portfolio of Vestia was more than 20 times the portfolio I managed before, refreshing my knowledge and skills was priority number 1. I got some training on the job by an experienced interim treasurer and I oriented on possible courses. The RT program at VU offered the best combination of theory and practice.

  3. What are key words that you would use to describe the program?

    The program is small scaled and interactive. You get to know all your fellow students very fast and there is enough time to exchange experiences.

  4. Which topics covered were most interesting?

    The most interesting courses for me were those courses I had little experience in: international finance and cash management. Piece of cake for seasoned treasurers, but new stuff for me. I also took courses in macro economics and behavioural finance.

  5. Can you describe what your research and thesis was about?

    My thesis researched the effects of new, tougher, legislation on the way treasury for housing associations is organised. I thought many had changed their processes, but most processes were already adequately organised and in control before 2012. With more emphasis on compliance after 2015.

  6. How did the education help you in your career?

    The RT program has helped me to become a professional in treasury in a short time.

  7. What surprising elements did the program hold that you did not expect?

    Behavioural finance was an eye opener for me. I took some psychology courses during university (marketing, organisation) but the impact of psychological elements on decision making was a positive surprise.

  8. Are you still in touch with your peers?

    Of course. I meet fellow students at DACT-events, we still have a Whatsapp-group and we are linked via LinkedIn.

  9. What other treasury education programs did you consider and why did you choose this one?

    I researched several other programs (NIVE QT, Improfin, modular courses), but VU offered a proven concept which was very practical for me (every week courses on Thursday afternoon and evening) and started very soon.

  10. Did following the program influence your relation with your family, friends and/or colleagues?

    Doing classes and assignments takes some planning. And sometimes you have to say No at home or at work, or skip class due to a priority job. Commuting by train gave me much time for reading and writing but not enough. Many weekends were spent writing my thesis, and also two holidays. Fortunately my wife took a course herself and my kids had their own exams.

  11. Can describe a treasury topic you learned about and you could directly apply in your job?

    In the first lecture I learned something about the consequences of a large divestment I had not thought about. Fortunately we could solve this directly. I also got more insight in the way banks were pricing loans, which resulted in better quotes.

More stories please! Read the RT story of Jarno, Mathieu and Richard and/or read more info about the RT program here.

The post-graduate Executive Treasury Management & Corporate Finance programme combines two finance disciplines: Treasury Management and Corporate Finance. These disciplines largely overlap and are inextricably connected.

After a successful completion of all required modules, the title of Registered Treasurer (RT) is conferred by the Registered Treasurer foundation.

As of last year the Register Treasurer (RT) program at the University of Amsterdam is taught in English. This is an important change as the program used to be in Dutch.

The course will start on 1 September 2019. Why wait? Apply today!

 

 

A deeper dive into the Treasurer Test Technical Knowledge part

| 19-07-2019 | by Kendra Keydeniers |

Different from the multiple choice questions in the Big5 Personality Profile assessment, a number of treasury technical questions require you to make calculations. Furthermore, there is a time pressure component: there are more questions than you will be able to answer within the limited time. You will have to balance between answering questions right and answering as many as possible. It is not possible to skip questions.

In previous blogs and in the Treasurer Test example report  we mention the four corporate treasury sub disciplines we work with. For each discipline you will have a limited time of 10 minutes to answer the questions.

In below summary you can see what topics you can expect:

  • Risk Management: future contracts, FX, interest, inflation, hedging, ALM, derivatives

 

  • Corporate Finance: various bond types, valuation, equity, dividend calculations, rating agencies, bank loans

 

  • Cash Management: zero balancing, liquidity management, bank account management, notional pooling, netting

 

  • Treasury Miscellaneous: transfer pricing, withholding taxes, capitalization rules, investments, treasury organization, reporting & analysis, accounting & accounting principles, treasury technology and tender processes.

Together with industry and university experts we continuously work on updates of the questions catalogue. A challenge is to balance what is always relevant in corporate treasury, what is new and what will remain relevant.

It is possible to send your input for the further design of the questions catalogue. We are currently discussing topics like tax reforms, trade finance, treasury technology, alternative funding sources.

On behalf of Team Treasurer Test,

Kendra Keydeniers
Community & Partner Manager at treasuryXL

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How to Solve the 4 Main Payments Challenges

| 18-07-2019 | BELLIN |

Sascha Kopp has been a Consulting Director with BELLIN for over 10 years. He has successfully accompanied and implemented well over 100 payments projects in international groups. In this interview, based on our on-demand webinar, he outlines the 4 main payments challenges for corporates and how to best tackle them.

#1 payments challenge: a complex set-up

What is the biggest challenge for international businesses in handling their payments?

When it comes to payments, the biggest challenge for companies is usually their existing set-up. Very often we witness the following: You have banks on one side, ERP systems on the other side, and the individual entities in the middle. They all exchange payment data, generated by various technologies and in different formats, communicated by several channels. Companies find it difficult to manage this complexity.

How can companies make sense of this complex set-up of several e-banking systems, payment platforms and communication channels?

A payments solution, such as BELLIN’s integrated payments platform in the tm5 treasury management system, allows corporates to leave complex set-ups behind: instead, they experience simplicity with one platform that is accessible to all group companies and connected to all ERP systems and banks. tm5 can be used with any payment format.

You can access it on a desktop computer, mobile phone or tablet. All you need is Internet access. One of the many benefits of this solution is that it is scalable and can be adapted to changing company requirements – and we all know companies change all the time.  Every time a new entity is added, no matter where in the world, this company and its banks can easily be connected to the payment platform. There is no need for an additional solution. The tm5 platform handles it all and is easy to use, transparent and secure when communicating data.

#2 payments challenge: fraud and cyber crime

How important is payment fraud?

Fraud, cyber crime and internal manipulation have been increasing dramatically for years. In 2016, the Leoni Group lost 40 million euros to payment fraud. In 2017, ABB reported a fraud case amounting to 100 million dollars. Companies lose more and more money and the number of attacks has been growing. This was confirmed by the AFP Payments Fraud & Control Survey published in April 2019: 82% of companies report having fallen victim to payment fraud.

How can companies best protect themselves against payment fraud?

Organizations currently invest a lot of time and money in fraud prevention. The best way of achieving payment security is to eliminate vulnerabilities, i.e. by using a multi-bank payments platform with integrated user permissions management such as BELLIN’s tm5. Thanks to a single point of entry and an additional security measure by way of 2-factor authentication in the BELLIN Connect app, tm5 protects companies from external threats. The integrated permissions functionality enables companies to define and manage user rights and implement dual approval for payment processing, thus ensuring compliance.

#3 payments challenge: cost

How can companies save money in their payment process?

In addition to bank fees, payments processing eats up resources. For most companies a centralized set-up is the most efficient – as well as the most secure – option to manage group-wide payments with only one team. As a web-based system, tm5 also enables decentralized cooperation using a central platform. We refer to this approach as Load-balanced Treasury.

What is the most affordable payments set-up for companies?

The most cost-efficient combination of formats and connectivity always depends on the countries in which payments are processed as well as on the volume of payments. tm5 offers all types of connectivity, be it local standards such as EBICS, host-to-host connections to main banks or a global solution such as SWIFT. BELLIN consultants offer advice on how to find the most affordable solution.

#4 payments challenge: new banking partners

What is the impact of changes to the banking landscape on corporate payments?

Companies are hit hard by changes to the banking landscape. In recent years, some banks have discontinued their services in some countries over night. But even when the selection of a new banking partner is driven by strategic and cost reasons, this change usually goes hand in hand with a new, additional e-banking system.

But it could be so much simpler: Companies who process their payments on the integrated payments platform in the tm5 treasury management system always work with the same user interface. This user interface is independent of the banks, channels and payment formats a company uses.

All in all:

Make the move to a central, multi-bank payments platform and benefit from:

  • compliance
  • security
  • reduced cost and effort
  • 100% visibility and transparency
  • 100% cash flow visibility
  • 100% independence thanks to self-administration

Sascha Kopp author picture

Sascha Kopp
Consulting Director at BELLIN