CRRC HongKong Capital Management creates new model for global treasury management

As the offshore treasury centre of CRRC Corporation Group, CRRC Hongkong Capital Management Co Ltd (CRRC-HKCM) collaborates with financial institutions outside mainland China to build an efficient treasury system. This empowers CRRC’s "funds arteries" to traverse mountains and seas, operating efficiently and securely. 

Constructing and applying CRCC-HKCM’s offshore treasury system

CRRC is a global leader in rail transit equipment manufacturing, with operations spanning over 30 countries and regions. As its overseas business has expanded, the need for centralised cross-border fund management, fund safety monitoring, exchange rate risk control and financing cost optimisation has become increasingly prominent. Against this backdrop, CRCC-HKCM initiated the development of an offshore treasury information system, with the following applications and outcomes:

(1) Global funds panorama visibility

CRRC’s offshore treasury system unifies, cleans and standardises offshore bank account data, breaking down information silos. It enables real-time data sharing and interconnectivity, providing the Group with timely and accurate offshore fund information to support rapid funding decisions. 

(2) Dual safeguards for secure operations

The offshore treasury system is built within CRRC’s internal network environment, utilising industry-leading database products to ensure network security, data security and system reliability.

(3) Significant Leap in operational efficiency

Leveraging shared resources within the Group, CRCC-HKCM has reduced operational costs, allowing it to focus more on system functionality development and business operations.

(4) Remarkable digital transformation results

Through close communication with headquarters and within the Group’s overall digitalisation framework, CRCC-HKCM continues to deepen the digital transformation of its offshore treasury. Phase Two of the treasury system is currently under construction, with key modules already deployed and operational, achieving digital transformation and upgrading of offshore fund management.

Key initiatives in building the treasury system with BOCHK

CRCC-HKCM selected Bank of China (Hong Kong) Limited (BOCHK) as its core banking partner to jointly establish an efficient and secure offshore treasury management system. The collaboration has yielded results in several key areas: 

(1) Establishing a cross-border cash pool for global fund visibility and control

With support from partner banks, CRCC-HKCM established an offshore cash pool, creating a channel for cross-border fund concentration. This cash pool offers the following advantages: 

1. Real-time fund concentration and global efficient allocation: Funds from domestic and overseas subsidiaries can be swept in real-time to the Hong Kong Treasury Center, enhancing fund utilisation efficiency. 
2. Reduced financing costs and centralised resource allocation: Internal fund transfers reduce reliance on external borrowing, lowering financial expenses. 
3. Compliant channel assurance and a “hub role”: As RMB internationalisation and the Guangdong-Hong Kong-Macao Greater Bay Area financial ties deepen, Hong Kong’s role as a global financial hub grows more prominent. By leveraging Hong Kong’s relaxed foreign exchange controls, cross-border fund flows become safer and more efficient. 

(2) Intelligent treasury system: building a global funds hub

CRCC-HKCM’s cognitive treasury system connected with BOCHK, achieving: 

1. Global account visibility: Real-time monitoring of subsidiary funds worldwide enhances risk control capabilities.
2. Automated payment and reconciliation: Reduced manual payment processing and automated reconciliation via electronic receipts improve settlement efficiency and reduce error rates.
3. Data-driven intelligent decision-making: Optimising the Group’s liquidity management strategy through cash flow analysis.

Lessons learned and industry insights

Through its exploration and practice in offshore treasury management, CRCC-HKCM can offer the following insights: 

(1) Select strategic banking partners wisely

BOCHK, with its international service capabilities, currency clearing advantages and deep understanding of Chinese enterprises, proved an ideal partner. As the world’s largest RMB clearing bank and the Chinese bank with an extensive global network and high level of internationalisation, BOCHK aligns with CRRC-HKCM’s global footprint, providing comprehensive financial services. When selecting an offshore banking partner, CRCC-HKCM prioritised institutions with strong Chinese backgrounds and global capabilities. 

(2) Synchronised deployment of the treasury system

CRCC-HKCM was established early in the Group’s internationalisation journey, setting up the Hong Kong Treasury Center in sync with global business expansion. This proactive approach avoided the pitfalls of fragmented fund management later. Enterprises planning to "go global" should design their global fund management framework early. 

(3) Deep empowerment by fintech

Integrating BOCHK’s intelligent system significantly enhanced fund management efficiency and drove process transformation. In the future, AI applications will further optimise the efficiency of cross-border payments, risk alerts and other aspects. 

(4) Compliance and risk control as safeguards

Offshore treasury management must comply with local regulations, such as Hong Kong’s Anti-Money Laundering Ordinance and China’s cross-border fund flow policies. The strong local regulatory networks and expertise of partner banks provided vital support in navigating cross-border policy differences. CRCC-HKCM also established a dedicated compliance team to mitigate legal and financial risks.

Conclusion

The collaboration between CRCC-HKCM and BOCHK demonstrates that by leveraging technology for efficiency and building on a foundation of compliance, Chinese enterprises can effectively enhance global fund management capabilities through scientific treasury system construction and strategic banking partnerships, thereby supporting international expansion.

Looking ahead, as global economic development and multinational globalisation continues, the role of Hong Kong Treasury Centers will become even more prominent. The global treasury management model of CRCC-HKCM aims to serve as a reference for more enterprises venturing overseas.