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Finding cash efficiencies and saving on pensions

Even if there seemed to be a dismal outlook for the UK economy, delegates at the ACT annual conference were able to gather lots of sound advice on how they could do their own bit to help their companies weather the storm ahead. The lack of bank lending capacity was certainly one theme but cash management and cash conservation was addressed in a direct response to this. In practical sessions, whether on treasury technology, risk, pensions and obviously cash management, the recurrent message was to focus on better use of cash within your group.

A plea for simplicity

The optimism “swingometer” took a lurch to the pessimistic side on day two of the ACT Annual Conference. The presentation from Alchemy’s Jon Moulton looked at the new order in finance. Much of the current financial crisis, he explained, had arisen from an excess of complexity so the true risks had remained hidden. There would be more regulation to redress this, but he doubted its effectiveness unless banking business could be simplified. The skills of regulators and bank directors are limited, so complexity has to be reined back: Basel II is rubbish….We need to get back to something simple. To

Bankers and treasurers fail to see eye-to-eye

Observing the attitudes of 500+ treasurers and bankers gathered at the ACT Annual Conference is providing a good indicator of sentiment.

While more is to come, at the end of the first day there seems to be a small glimmer of optimism from the corporate side while from the financial side pessimism prevails. The non-financials see credit margins beginning to turn downwards, while the banks are still talking them up.

Treasury primer

Irrespective of the size of a company, its geographic location or its range of business, it needs to answer the following questions…

  • what treasury activities does it have?
  • who is responsible for them?
  • what are the limits of their authority?
If we accept that businesses need comprehensive risk management at their heart, then the education, experience and skills of a treasurer make him or her the most suitably placed business executive.


Are we seeing the first ‘green shoots’ of banks entering the lending markets?

Managing currency risk

Companies across the board are finding the volatility in foreign exchange hard to deal with particularly in view of the reduced availability and variable pricing of hedging products.

FX divisions in banks are now highly profitable. About the only thing that we can forecast for certain this year is that any sort of FX hedging for corporates is going to be expensive and the advice is “shop around”. This month the links below focus on the prospects for sterling and also include reports on how certain companies are managing their currency risk in this environment.

Credit crisis and corporates – funding and beyond

The results of our credit crisis interviews with over 40 treasurers have recently been published and the report is available here.

This was a time consuming but hugely valuable exercise in assessing the effects of the credit and banking crisis on our members – we will be updating this work ahead of further discussions at the Annual Conference in April. As you can see there is some good news, some not so good news and a surprise or two!

Living without bank funding

Despite the Government’s attempts to kick-start lending to business, banks are not providing finance for business in anything like the volume that is required.

Surveys of companies and anecdotal evidence indicate that many companies expect this to continue for the foreseeable future and are cutting back hard on investment. Treasurers are looking at alternative sources of funding such as the bond markets.


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