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Trends in Corporate Treasury & Technology

Laurens Tijdhof – Partner

Eliane Eysackers – Executive Consultant

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• EBAM: Your remote control in bank account management

• Presentations from different perspectives:

– Corporate case studies : Cytec and Liberty Global

– Standards & Central Utility : SWIFT

– Bank readiness & solutions : RBS and BNP Paribas

– Treasury system solutions : IT2 and SunGard

– Treasury Consulting : Zanders

• Key discussion topics:

– Introduction to EBAM

– What are the ‘Corporate’ pre-requisites for implementing EBAM?

– How far is the ‘Treasury Ecosystem’ in offering EBAM solutions?

Today’s Agenda

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• Introduction

• Simplification of the Treasury Model

• Treasury Technology & EBAM

Table of Content

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• Zanders is an independent consulting firm specialized in the area of Treasury and Finance:

– Cash & Liquidity Management

– Risk Management

– Corporate Finance

– Treasury Strategy & Organization

– Treasury Processes & Systems

• Founded in 1994 by Chris J. Zanders, currently with presence in the Netherlands, Belgium, Switzerland and the United Kingdom

• With more than 150 professionals the leading company in Europe for advisory, interim, outsourcing and transaction services

About Zanders

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• Introduction

• Simplification of the Treasury Model

• Treasury Technology & EBAM

Table of Content

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1980..

Expected Trend in Next Decade: Back to Productivity

Working Better

Reengineering

1990..

Working Cheaper

Outsourcing

2000..

Working Elsewhere

Globalization

2010..

Working Simpler

Simplification

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Strategic Opportunities for Simplification

Treasury Area Trend Recent Past Near Future

Treasury Organization

- Virtualization- Centralization- Local empowerment

- Decentralized- Local services

- Virtual global organization- Centralized (IHB/PF)- Enhancement of SSC concept - Maintain company culture

BankingLandscape

- Independence- Rationalization- Balancing bank fees vs. credit commitment

- Multiple banks- Multiple bank accounts- Multiple EB tools- Multiple single cash pools

- Balanced banking wallet- Simplified account structure- Independent bank connectivity- Multi-currency overlay cash pool

System Infrastructure

- Automation- System integration- STP

- Stand-alone system landscape

- Non-automated interfaces

- One global portal- Integrated best-of breed TMSvs. full ERP solution

- Seamless interfaces

Treasury Workflows & Processes

- Simplification- Standardization- Enhance compliance

- Many different processes - Not very standardized- Labor intensive

- Uniform processes- More with less- Dematerialization of paperEBAM

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Building Blocks for Treasury Transformation Projects

Trends

Centralization

Automation

Independence

Standardization

Key Drivers

Reduce Cost

&

Create Value

Reduce Risk

&

Improve Control

Results

- Virtual Global Treasury Organization

- SSC / Payment Factory

- In-House Bank

- Single ERP/TMS

- Seamless IT interfaces

- Dematerialization of paper (EBAM)

- Straight-Through-Processing (STP)

- Wallet distribution

- Disintermediated funding strategy

- Bank connectivity (SWIFTNET)

- Process Improvement

- Products and formats (SEPA)

- ISO XML 20022

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• Introduction

• Simplification of the Treasury Model

• Treasury Technology & EBAM

Table of Content

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Treasury Technology - Catalyst for Corporate Change

Time

Level of

Centralization

Decentralized

cash management

by subsidiaries

Local liquidity

centralization

Regional / global liquidity

centralization (Netting & In-House Bank)

Shared Service Center,

Payment & Collection Factory

Virtual Treasury (centralized

and paperless, combined

with local empowerment)

Simplifying and automating

Treasury Processes (EBAM, FSCM)

Today

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EBAM helps corporate treasuries to increase control, visibility and efficiency by dematerializing the tedious process of bank account management.

EBAM – What is it about?

Control

Visibility

Efficiency / Automation

Integrated global application for bank account

Opening Maintenance Closing

Standardization (XML)

Bank Connectivity

(SWIFT)

Virtualization (e-doc’s)

Drivers Enablers Electronic Bank Account Mgmt

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EBAM – How to get there?

EBAM Connectivity Options Key Features

• Add-on to the electronic banking system

• Bank proprietary solution

Good in-house digital data management is key (e.g. accounts, signatures). From a conceptual perspective, there are three possible ways to set up EBAM.

• EBAM application is outsourced to a 3rd-party vendor (e.g. a service bureau)

• Bank independent

• Client-hosted solution, e.g. as a module of the treasury management system

• Bank independent

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Zanders’ EBAM-related services

EBAM provides an opportunity for corporates to review the current BAM policies and processes before taking it to the virtual level.

Policy

Processes

Organization

Compliance

Applications

• As-Is: Review and assessment of current BAM policies and related processes

• To-Be: Solution design of future (audit-proof) processes, EBAM-related policies (e.g. digital signatures, 3SKey)

• Roadmap: Blueprint of ideal EBAM set up (incl. EBAM solution from TMS, banks and/or 3rd-party vendors)

• Implementation: Phased approach for implementing future EBAM solution (different roles per phase, depending on the scope of the project and the chosen IT set up)

EBAM

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• EBAM will change the way you communicate with your banks

• It will reshape bank account management (BAM) in the same way as email changed the concept of mail (the ‘new’ normal)

• Main benefits of EBAM include a faster and more controlled corporate-to-bank communication for opening, closing and maintaining accounts

• Best market practice is to approach EBAM in two steps:

– Optimize internal treasury organization, processes and systems (BAM)

– Dematerialize external paper-based bank account management with EBAM technology available from system vendors, banks and/or SWIFT

• The ultimate goal is a ‘virtual and paperless treasury organization’

Are You Ready for the Next Step?

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Questions

Simple

≠

Easy

Treasury?

K.I.S.S.!

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Zanders Netherlands Brinklaan 134 1404 GV Bussum The Netherlands T: +31 35 692 8989

Zanders UK 26 Dover Street W1S 4LY London United Kingdom T: +44 207 763 72 96

Zanders Belgium Place de l’Albertine 2 1000 Brussels Belgium T: +32 2 213 84 00

Zanders Switzerland Bächtoldstrasse 5 8044 Zurich Switzerland T: +41 79 372 08 01

Contact Information

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distributed in whole or in part to any other person. All information contained herein

is confidential and proprietary to Zanders and any of its subsidiaries. This material

is not to be disseminated, reproduced in whole or in part without the written prior

consent of Zanders.

By furnishing this presentation to the recipient, Zanders is not committing to any

transaction. Although any indicative information is reflective of the terms under

which a transaction might be arranged, no assurance is given that such a

transaction will be executed on the specific terms indicated, due to changes in

circumstances or new understanding through further analyses.

Disclaimer