Treasury Strategy & Transformation
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Brave New Treasury

by Maneesh Goel, Vice President, Product Management, Bank of America Merrill Lynch

Over the past three years, treasury in Asia has undergone something of a transformation. Before the global financial crisis, structures tended to be decentralised and the work of treasury staff largely centred around executing transactions. Fast forward three years, and the picture looks very different. Treasuries have been streamlined, nuts and bolts tasks have been outsourced and there is increasing interest in the use of innovative technology to improve visibility and control.

The global crisis in Asia

The global financial crisis did not originate in Asia and as such, the impact across the region was less severe than in Europe and the U.S. Nevertheless, in today’s globalised market, a significant impact was inevitable. Many multinationals have subsidiaries in Asia, which often felt the same liquidity squeeze as their parent companies. Repercussions were also apparent in international trade, with Asian exporters feeling the pinch when their  western customers reacted to the economic downturn by tightening their belts.

Central banks across the region became more cautious, although this was more in a bid to pre-empt the effects of the crisis from spreading, and to combat inflation, than in response to actual financial conditions in Asia. Meanwhile, companies across the region began to review  their workforce, albeit to a lesser extent than in the US. For some companies this was a necessity, while others took advantage of an opportunity to rationalise manpower. Treasury staff were not excluded from these cuts.

A different mind-set

The combination of these conditions has led to some fundamental changes in the mind-set of the Asian treasurer, which continue to reshape treasury practices across the region today.