A look at what’s on International Treasurer’s radar screen this week.
Several topics came out of this week’s International Treasurer editorial meeting. In the next few weeks we’ll look at how financing for corporates is changing in Europe as well as reveal what’s coming up on the agendas for the NeuGroup’s peer group meetings.
Disintermediation. As pressure on European banks continues to grow – from both their sovereign debt exposures to new rules on capital and liquidity buffers – it is becoming apparent to European corporates that banks there will not be able to as readily provide the financing they have in the past. This is forcing some companies to tap the bond market as well as other sources of financing. We’ll take a look at how this is happening and the benefits for companies.
Coming Peer Group Meetings. Over the coming weeks NeuGroup peer group leaders will be fleshing out the agendas for the Latin American Treasurers’ Peer Group, both FX Managers’ Peer Groups and a host of others. We’ll take a look at what’s on the agendas of these meeting which will give a good idea of what treasurers and FX managers are thinking about right now and what concerns them about the future. Early indications of what they’re thinking about are electronic trading platforms (FX), mobile banking and supply chain finance.
Cash Leaving MMFs. Regulations could be working to make money market funds less attractive to corporations, which would force them to put their money in banks. Specifically, the SEC has been looking at structural reform of money market funds, including the options of mandating a floating net asset value and the use of capital buffers. But most corporate users are against the floating NAV, arguing that the “buck” is the main and most attractive feature of MMFs and central component of many cash management programs. Some think the idea is to get companies to use bank deposits more, where Regulation Q has allowed interest on demand deposits for the first time since 1933 (see related story here).