Treasury Management Internation Logo
Treasury Strategy & Transformation
Published  5 MIN READ
Please note: this article is over 5 years old. If you feel this article is inaccurate or contains errors get in touch here . Many thanks, TMI

Treasury in Changing Times

Treasury in Changing Times

by Jennifer Boussuge, Head of Global Transaction Services EMEA, Bank of America Merrill Lynch

Macroeconomic and regulatory developments continue to dominate headlines and occupy corporate treasurers’ attention in Europe. After a few years of respite, the Eurozone’s existential crisis has re-emerged, prompting renewed instability across the region. While the immediate threat to most countries is considerably lower than in 2012, for companies, uncertainty and change create risks that they are eager to mitigate. As a consequence, treasury is looking for improved risk management tools and ways to enhance efficiency so it can help the business achieve its strategic objectives. At an operational level, macroeconomic uncertainty can have a negative impact on sales and companies’ ability to do business when currency controls are introduced, as in Greece earlier this year. Moreover, uncertainty has had a sizeable impact on foreign exchange (FX) volatility. While such volatility can be hedged, there may be additional cost implications from such strategy.

Another significant challenge is the ongoing regulatory reform affecting corporates both directly and indirectly. While the forthcoming shape of regulatory change in Europe is broadly known, companies that operate in multiple regions face constant change. The fast pace of developments requires constant attention if treasury is to optimise these opportunities and minimise risk.