How BOCHK’s global cash management solution addresses treasury challenges faced by a leading consumer goods company
A leading global company in the consumer goods space needed to address the challenges with decentralised treasury management, as it pursued a successful worldwide expansion strategy. The company had a wide range of businesses and bank accounts across several countries and regions with various banks.
This fragmented banking infrastructure caused two critical problems in global cash management. The first of these was a lack of visibility into cash positions globally, resulting in processing delays, and ultimately increasing operational costs. Another challenge for the company was that in the absence of centralised management, each overseas account had varying levels of cash reserves, leading to an inefficient use of funds and increased borrowing costs.
BOCHK was tasked with implementing a centralised treasury management solution for the company to tackle the above problems.
Maximising global accounts oversight
BOCHK’s intelligent global transaction banking platform is a perfect solution for multinational businesses looking to streamline their treasury operations. By integrating all global bank accounts and transaction details through BOCHK’s internal channels, treasurers at the consumer goods giant have gained greater visibility and control over their global cash positions. The platform centralises access to all global accounts, simplifies monitoring, and eliminates the need for manual processes in cash management.
BOCHK’s innovative solution has offered the consumer goods company a competitive edge in managing global treasury operations. With constant report formats provided by BOCHK for all bank accounts of subsidiaries, the level of automation in the company’s global cash management processes has improved. Treasurers can thus save time on operational work and focus to a greater degree on strategic planning.
Creating a multi-currency cash pool
A multi-currency cash pool has been established in Hong Kong, helping the company concentrate global funds across 13 markets in over 30 currencies including HKD, CNY, EUR, USD, etc. With such a structure in place, the company can easily pool cash across different geographies and currencies, simplifying the challenge of international business monitoring and control.
Deploying solutions that address liquidity and risk management
Dealing with the ever-increasing globalisation of commerce, the company aims to be vigilant in accurately evaluating its exposure to currency fluctuations and interest rate changes. By doing so, the company can reduce volatility in earnings and cash flows, thereby ensuring financial stability. A wide range of liquidity management functions such as fund planning and analysis, payment and collection management, and foreign exchange management are essential to mitigate potential risks and enhance liquidity.
Through BOCHK’s comprehensive cash pool solution, the consumer goods giant is expecting to maximise yield returns, reduce time and cost involved in global transfer, and mitigate FX and interest rate risks.
Supporting a transformation in cash management for multinational businesses
BOCHK values communication and cooperation with partners. By working closely with the subsidiaries of the consumer goods company and their finance teams, BOCHK has been able to provide timely solutions to challenges raised by various stakeholders, streamline procedures, and ensure the smooth implementation of the project.
Leveraging its extensive experience as a provider of cash management solutions, BOCHK has shared professional insights and advice with treasurers working for the consumer goods giant. The specific areas have been the construction of a corporate treasury structure and cash pooling arrangements, thus guiding the consumer goods company’s team towards an efficient treasury management strategy.
BOCHK remains committed to advancing its comprehensive cash management solutions to support multinational businesses as they seize opportunities across international borders.