What’s on International Treasurer’s radar screen.
There were a number of items developing from this week’s International Treasurer editorial meeting. Among them were a number of ideas stemming from the Association of Financial Professionals’ (AFP) meeting in Boston. Also several items are developing as a result of the NeuGroup’s Tech20 Treasurers’ Peer Group meeting November 2-3, 2011.
AFP
This week’s AFP conference in Boston (November 7-9) was reportedly one of the most well attended conferences in years. While there, International Treasurer picked up on several themes and threads. One of them was news that Wells Fargo is now making a concerted push into Europe in support of, for now, US companies doing business there (given the pressure on otherwise pre-occupied European banks, this could be a successful foray).
Bank Codes are Getting a Makeover.
Also at the conference, X9/SWIFT announced the release of BTRS (Balance and Transaction Reporting Standard). The standard will improve corporate cash management process. BTRS “will harmonize the disconnect found in the previous versions of the BAI releases,” according to a statement from X9, the organization that maintains the standards. BAI 2 has been the bank code standard for over 20 years. While other reporting formats exist, BAI 2 is by far the most prevalent and every commercial bank in America and Canada, of any size, provide reporting to their clients using these reporting codes and standards.
Banks Move Beyond Products to Analysis and Advice. Another theme picked up at the conference was that of banks offering more than services. Executives at JP Morgan Chase told International Treasurer that one of the bank’s objectives was to grow its role with clients to bring more innovation and advisory support to their finance leadership. To that end it is focusing on broad strategic issues with treasurers and CFO’s, such as helping them build the business case for strategic projects. JPM has taken advantage of the considerable amount of static client data within its databases by developing tools to leverage that data into meaningful and actionable information.
Mobile Apps for Treasury Gaining a Foothold. Smartphone apps have been around for a while for consumers but are only just now hitting the market for commercial clients. A year ago, software and services provider Fundtech launched a platform that allowed treasurers to manage a wide variety of functions while on the road (see related story here). And now banks are jumping in as well. JPM has been out with an mobile treasury app for about two months. The app is only for iPhone and Android. And Wells Fargo and BofA also have smart phone apps for their commercial clients and again are only for iPhone and Android (in Wells Fargo’s case only for iPhone).
Issuing Debt
One question that came up during the NeuGroup’s Tech20 meeting was whether cash-rich technology companies should issue debt to take advantage of low interest rates, even if the company doesn’t need the money and even if it increases expenses and hurts. The general consensus was that this wasn’t a good idea because among other things – lost opportunities, raises investor questions about management – it’s not a sustainable policy.
On the other hand, many companies are issuing debt lately, and in record amounts. Is this taking advantage of the low rates or possibly preparing for a coming liquidity crisis or bank lending pullback?