Asia Pacific’s leading corporate treasurers have identified improving cash visibility and cash flow forecasting as key priorities in the next 12 months, according to a new report by Bank of America Merrill Lynch and SunGard.
The Asia Pacific Treasury Management Barometer Survey notes that these priorities illustrate the evolving roles of treasurers in the region, resulting from managing a range of banking relationships, operating with a large number of accounts and disparate means of accessing account information.
They also note that there is scope for enhancement in areas including treasury process automation, optimizing working capital and focusing on risk management within their functions.
“By analyzing the data, it is clear that corporations in the Asia Pacific region are increasingly focused on integrated treasury management platforms and solutions, which deliver real-time analytics, multi-bank visibility, cash flow forecasting and transaction management across countries, currencies and time zones,” says Ivo Distelbrink, head of Global Transaction Services, Bank of America Merrill Lynch.
“Against this backdrop, the role and responsibilities of the treasurer in Asia Pacific are changing meaningfully, and strategic treasury advisory will be imperative to enable treasurers to take advantage of changing objectives and priorities.”
“Treasurers in Asia Pacific are increasingly focused on leveraging efficient technology to achieve operational and financial efficiency,” said Ash Khalek, senior vice president, corporate liquidity sales at solutions firm SunGard. “With a third of respondents already using hosted and cloud-based (or SaaS – software as a service) solutions for treasury management, treasurers recognize the role of these solutions to ‘leapfrog’ legacy technologies and achieve rapid implementation of a best-in-class treasury technology infrastructure.”
Over 1,350 treasury professionals from Asia Pacific and around the world were interviewed for the study by Bank of America Merrill Lynch and SunGard, a 45% increase in participation from the first edition. Respondents were drawn from a wide range of corporations as measured by revenue.
The survey also has these findings:
· Obstacles to efficient liquidity management remain: Multiple bank relationships (86%), currency controls and regulatory constraints all contribute to difficulties in managing liquidity in Asia Pacific; over half (62%) do not use automated cash pooling.
· Basel III/LCR shortfalls: 61% of respondents expressed no or little awareness of the implications of Basel III and the Liquidity Coverage Ratio (LCR) regulatory initiatives.
· Renminbi acceptance growing: 35% of participating companies use RMB for cross-border trade (compared with 16% in 2013), reflecting the growing internationalization of the RMB.
· Facilitating cross-border trade: 78% of participating companies make payments into three or more countries, emphasizing the need for sophisticated cross-border payment solutions.
· Game-changing technology: 41% of participants have a treasury management system (TMS) or treasury module of an enterprise resource platform (ERP) in place. However, 52% of participants are seeking to leverage treasury and banking technology to optimize internal processes.
· Mobile treasury: Use of mobile and tablet devices in treasury is growing substantially, from 14% in 2013 to 41% in 2015
