What do treasurers need to know about bank ring-fencing?

To prevent a repeat of the 2008 financial crisis, UK regulators have set out to drastically reform the banking system – by separating the retail and riskier investment arms of UK banks into separate legal entities. Known as ring-fencing, the objective of these new rules is to achieve greater resilience and financial stability for the banking system. Ring-fencing applies to any UK bank with over £25bn of retail deposits, including all major high street banks, and they must be ring-fenced by 1st January 2019. The changes will impact corporates as well as personal customers. Most recently, Barclays announced that it

Pension Deficits – Do these still keep treasurers awake at night?

This month’s PPF 7800 index (1) revealed an aggregate deficit of £180bn for the defined benefit (DB) pension schemes within its sphere, at 31 July 2017. Although this is a significant level, it compares favourably with the deficit position at July 2016 (2), when the level was £333bn. Funding comparisons July 2016 June 2017 July 2017 Aggregate balance -£333.5bn -£186.2bn -£180.1bn Funding ratio 81.4% 89.1% 89.4% Aggregate assets £1,458.4bn £1,514.6bn £1,524.7bn Aggregate liabilities £1,791.8bn £1,700.8bn £1,704.8bn Data set / assumptions Purple 16 – A7 Purple 16 – A8 Purple 16 – A8 PPF7800 Index August 2017 The improvement in the

Shared Service Centres – treasury trends

Treasury is a constantly evolving profession, as the ACT’s current Business of Treasury research shows, with treasurers’ strategic engagement with their organisations increasing. One area where I have seen this happening is with treasurers’ involvement with their organisation’s Shared Service Centre (SSC). Shared Service Centres – why the interest? Evidence came from two key sources. Firstly, an increased number of requests to provide learning support for treasury teams within SSCs and secondly, discussions with treasurers who were being asked to take responsibility for the treasury aspects of the SSC teams. As this increased, the ACT felt that it would be

No cash management, no long-term future

Cash management is often seen as the routine part of the job, the bit where process can be perfected and no-one in the company takes much interest until something goes wrong, like a supplier is not paid. That is a myth! Cash management is the glue which holds the company together and it is the start of the whole strategic process. It’s also a way for the treasurer to get their foot in the door of operations and really find out what is going on. Funding the company is arguably the only job which the treasurer must always get right

Will Brexit cause walls to collapse or only cracks to appear?

The Brexit topic continues to draw in the crowds at any seminar and this morning (31 January 2017) was no exception.  It was ‘standing room only’ at Slaughter and May’s client seminar titled: Tremors and Aftershocks: How to manage the impact of the Brexit earthquake and recent world events. How to manage the impact of the Brexit earthquake?  It was clear that we’re not yet sure exactly when the earthquake will happen, the magnitude, or even where the epicentre will be.  From a poll of attendees 37% thought it was too early to understand how Brexit was going to impact

Happy, well perhaps interesting 2017

We sit in London looking out on the office blocks of the financial services community and that does give a bias to be drawn to read the Brexit blurb in the press but 2017 will raise issues which transcend the UK’s self-imposed uncertainty of stepping out of one trade bloc in the hope of creating its own. Brexit has yet to formally commence although we now know how to do that. We will continue to watch and worry over its development for several years. The themes we can expect to develop to some tangible outcome during 2017 are bank regulation

Financial regulation – a step closer for corporates

I recently attended a roundtable to discuss the forthcoming UK Money Markets Code (which ironically will not cover MMFs).  The opening sentence uttered by a banker who was co-hosting the meeting was “this is not regulation by the back door”.  I listened, argued, tried to believe it, but don’t. If bankers want to impose ‘soft regulation’’ on themselves that is fine (and arguably laudable) but my real concern is that old saw of ‘unintended consequences’…  Basically any corporate who is “regularly active” in placing money on deposit, investing in repos or borrowing and lending securities will be caught by the

UK Payments Strategy for 21st Century

The final strategy document has been published and can be viewed here. The (Payment Services) PS forum has spent the last year talking to stakeholders across the UK to develop this strategy to meet perceived shortcomings in the UK payments infrastructure. The ACT responded to earlier drafts and calls for discussion. Members sit on the Forum and its sub groups. In general we agree to a strategy that foresees development of a more simple system which will be PSD2 compliant and seek further standardisation of file format to ease exchange of data. The impact on corporate treasurers, and their IT