e-Forex-Nov-23

Corporate treasury automation: How technology is solving pressing needs
“Automation not only improves productivity but also delivers
accuracy in an area where compliance is paramount.”
to morph into a “Whole of Treasury”
decision support framework with
multi-product execution capabilities.”
SPECIAL REPORT
Bob Stark
flows that drive FX trades can lead
to incremental services and decision
support tools,” he says. “Banks have
previously been unable to deliver
these due to the vanilla data that
has historically accompanied trade
instructions.”
He goes on to illustrate an example.
“We are working on solutions for
banks to deliver to clients that
enable rules to be configured by a
Corporate Treasurer,” he says. “They
can automatically calculate and adjust
a net hedge position, complete cash
flow forecasts based on real data,
and then automatically sweep excess
balances back to base currencies or
into money market instruments.”
Honkanen believes automation’s timesaving
benefits are obvious, but not
readily apparent. “Whenever there
is any recurring task that is taking
people’s time,” he says, “or whenever
they think something should be more
systematic, if it just didn’t take so
much time, it is wise to investigate
how the automation solutions could
help.”
While time savings are an obvious
benefit, Honkanen explains they extend
further. “The benefits are twofold,” he
says. “Either reduced costs via improved
liquidity and risk management, or the
ability to focus on more value-added
and strategic themes when operations
are more efficient.”
van Daatselaar opines that
automation can change the nature
of the corporate FX portal. “FX risk
management and funding are a
small proportion of the challenges a
Corporate Treasurer needs to handle,”
he says. “We are convinced that the
FX portal used by clients will begin
EXTENDING AUTOMATION
Corporate treasurers currently have a
good idea of which processes stand
to benefit from automation. But are
there any underrated workflows that
deserve more automation? Kyriba’s
Stark believes so.
“FX exposure management, especially
quantifying the impact of currency
on the balance sheet, is an area most
treasury teams can improve upon,”
he says. “Organisations generally do a
good job with their cash flow hedges,
typically struggling only with the
estimation of future cash flows so they
can be as effective as possible with
their hedging.”
“Yet,” he continues, “balance sheets
are a completely different process
requiring a separate data strategy and
unique tools to extract, organise, and
quantify exposures within balance
sheet accounts. This allows treasurers
to make more informed decisions
about natural hedges that can be
leveraged and derivative positions that
can mitigate remaining exposures and
reduce value at risk.”
van Daatselaar doesn’t label any
specific workflows when asked,
believing treasurers must approach the
question from a risk perspective. “It’s
the management or orchestration of
data that drives the decision-making
where Corporate Treasurers and
banks need to start,” he says, “before
taking advantage of readily available
electronic execution capabilities.”
With volatility increasing worldwide, treasurers need automation more than ever
“Taking control of how data is
collected across an organisation,”
he continues, “processing it so that
balance shortfalls and exposure to
currency volatility are as close to
real-time as possible, then taking the
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