Shortly before, after, and of course during this year’s
Sibos, the main topic for corporates to discuss (or worry
about) was the impact
Basel III and its consequences – both intended and unintended –
and SEPA, as well as the
International Payments Framework Association, were all high
on the agenda.
delegates said the extra burden of regulation is likely to cause
more harm than good to an area of banking that has more than proven
its stability over the last few years. We wait to see what the
final reckoning will be, but the way a bank monitors and reports
its positions is going to – and has started to – change
dramatically. Recent market uncertainty increased the need for
companies can close critical
transactions quickly, accurately and securely.
In the future, operational
treasury functions, primarily those related to the execution of
the cash-conversion cycle, will either be outsourced to a company’s
shared-service centre or to a third party. What remains in-house
will be the strategic, value-added functions, like the holistic
management of a combined risk portfolio and the optimisation of the
internal and external corporate finance function. Everything else
is likely to be outsourced.
The most significant initiatives within the
industry included the UK Payment Council’s appointment of Experian
to create, manage and maintain an
industry database on corporate payments to “improve the
accuracy” of online- and telephone-based payments. Experian will
collect, verify and standartise information on how banks’ corporate
customers receive bills. This will also ensure that banks keep
information up-to-date and accurate.
In the US, meanwhile, the Accredited Standards
updated its transaction standards for corporates business
accounts. The adoption of one common standard will aid a corporate
treasurer efficiently utilise and invest the cash resources of
their company. One article that received significant interest from
SunGard’s addition of a credit risk analytics feature to its
short-term cash management portal.
Its Global Network Short-Term Cash Management
portal gathers collective fund data from Standard & Poor’s
(S&P), Sector Treasury and Crane Data and gives corporate
treasurers access to credit information as well as counterparty
data. Investors can view funds’ underlying holdings by
characteristics such as country, security type, credit rating or
maturity structure on a consolidated basis across their entire
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Strategic moves included
Wells Fargo’s extention of its cash management solutions system
to Europe to provide a single channel for US companies that trade
abroad, and Bank
of America Merrill Lynch’s launch of a web-based electronic
bank account management (eBAM) service for its corporate and
commercial clients in the US and Europe.
Besides Europe and the US, a market to watch will be
As the economies of African countries evolve and thus the corporate
business becomes more sophisticated, the most requested software
applications for corporate banking in West, East and Southern
Africa will be in cheque processing, cash management, wire
transfers, trade finance and document management.
Vendors should market basic applications that can manage
liquidity and cash. Payment processors with SEPA-compliant
solutions are well placed to transfer their knowledge and business
propositions in Africa, while SWIFT-based payments service bureaux
should be in the sights of software application providers.