European treasurers continue focus on sovereign debt woes, counterparties, regulation.
The NeuGroup’s European Treasurers’ Peer Group (EuroTPG) set the agenda for its upcoming spring meeting in May. Among the topics are the main headaches currently plaguing treasurers across the NeuGroup peer group network. But this group clearly has special bragging rights since they’re closest to the hot spot otherwise known as the eurozone.
Members will hear from a senior economist from sponsor Bank of America Merrill Lynch about the current state of the Eurozone and from fellow members about the actions taken to analyze their euro risks and prepare for contingencies, up to and including some sort of breakup scenario. How bad can things get and what can treasury reasonably do to mitigate some of the risk?
Next up is a rules and reg update. This will be an attempt to clear up confusion about what effect Basel III capital and liquidity ratios and associated costs will have on banks’ corporate clients. If as per the FT investment banks are to shave a trillion dollars off their balance sheets in the next couple of years to comply with new rules and regs, what will be the second- and third-order effects on cost of funding, hedging and other bank services? Will some banks shed some types of business entirely and, if so, which ones?
Credit-rating changes and adaptation to Basel III and new financial regulation contribute to continued counterparty reviews by corporates. In a members-only session, participants will share their counterparty risk assessment methodologies and how banking relations are managed or modified. The fun doesn’t stop there: members will also dissect the IFRS 13 standard to see how exactly to go about calculating and applying the credit value adjustment (CVA). IFRS 13 on fair value measurement was published in May 2011 and will go into effect on January 1, 2013 so the clock is ticking on how to get this right.
The EuroTPG meets May 23, 2012. The group is part of The NeuGroup’s network of 14 active treasury and finance peer groups. To learn more about the group, please contact Anne Friberg at [email protected].