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Bringing It All Together - A cohesive approach to liqudity and risk The 3rd BNP Paribas' Cash Management University took place in Paris, France between the 8th and the 9th of October 2009. It proved a marvellous opportunity for over 200 senior corporate treasury professionals and industry experts to share and explore ideas, case studies and new opportunities for liqudity optimisation and risk management. With both a broad agenda during the plenary sessions and the chance to discuss issues in detail during a series of specialist workshops, there was plenty of food for thought for treasurers, whatever their primary areas of interest. This TMI article documents some of the key messages and overall conclusions of the Cash Management University.

Included in this article is a particularly useful 'Treasurer's Checklist' that lays out the general objectives, processes and fundamental disciplines a treasurer must follow in order to provide an effective treasury strategy.

Bringing It All Together

- A cohesive approach to liquidity and risk

BNP Paribas’ Cash Management University Review

The 3rd BNP Paribas’ Cash Management University, which took place in Paris, France on 8 – 9 October proved a marvellous opportunity for over 200 senior corporate treasury professionals and industry experts to share and explore ideas, case studies and new opportunities for liquidity optimisation and risk management. With both a broad agenda during the plenary sessions and the chance to discuss issues in detail during a series of specialist workshops, there was plenty of food for thought for treasurers, whatever their primary areas of interest. The themes covered in some of the workshop sessions have been previewed in earlier articles in this series; in this article, we summarise some of the key messages and overall conclusions of the Cash Management University.

A new version of normal

“A new version of normal” was how Frédéric Surry, Chief Executive Officer, BNP Paribas Asset Management, described the current market situation. The immediate crisis seems to have passed, but companies’ focus on liquidity and risk management has changed fundamentally from two years ago. As Pierre Boisselier, International Treasurer of Publicis outlined, “When liquidity is scarce, cash is king.” Treasurers have been forced to find new ways to finance the business and achieve cash flow efficiency, but they have followed different routes to achieving this. For example, Pierre described how Publicis has focused on the inception of cash, i.e,. collections, as part of a robust working capital strategy, and aligned the interests of the business as a whole, so that sales objectives do not compromise financial objectives by using the company’s balance sheet to finance their customers.

Marcel Kellerhals, Group Treasurer, Panalpina, also stressed the importance of collections, with accounts receivable the largest asset on the balance sheet, and described Panalpina’s vision of a global collections factory in the future. He described the global cash model which is in progress at Panalpina, combining notional and physical pooling techniques to centralise liquidity. Looking ahead, the intention is to achieve greater bank-independence in the payments and cash management processes using SWIFT, to enable a global overview of cash on a daily basis. In addition, there is a greater focus on cash flow forecasting to enable liquidity needs to be anticipated more accurately so that surplus cash can be put to better use.

Leveraging external opportunities

In addition to internal and bilateral initiatives between corporate treasurers and their banking partners, there are also a variety of external opportunities for improving the efficiency of liquidity and risk management. With SWIFT Corporate Access becoming more prevalent across the corporate community, there is a growing range of capabilities for corporate-to-bank communication, such as eBAM (electronic bank account management) together with personal digital signatures, and the TSU (Trade Services Utility) which banks are increasingly using to deliver trade services to their customers. eBAM was the subject of a presentation by Elie Lasker, Head of Corporate Market at SWIFT, and Gilbert Labbé, Head of Treasury, EDF, who piloted the eBAM initiative.

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