Bank Treasury Research Articles

AI in Treasury Management: Enhancing Bank's Treasury System for Budget Execution in the Medium Term

AI in Treasury Management: Enhancing Bank's Treasury System for Budget Execution in the Medium Term

The Impact of Quantitative Tools of Monetary Policy on the Performance of Deposit Money Banks in Nigeria (1986-2019)

The goal of this study is to provide empirical evidence about the impact of commercial bank Treasury bill subscription, monetary policy rate, liquidity ratio, and cash reserve ratio on the profitability of Nigerian deposit money banks. The ex post facto research design was adopted for this investigation. Ordinary Least Square was utilized for a regression analysis of the data. According to the results, there is a strong correlation between treasury bills subscription and private sector lending. The research found that the cash reserve ratio correlates highly with private sector lending. The research suggests that the Nigerian government implement measures that would assist deposit money institutions in the country to enhance their lending facilities, particularly for the private sector. To make bank borrowing appealing and inexpensive for investors, the monetary authority must also appropriately handle the quantitative instruments of monetary policy.

Digital technology adoption in a bank Treasury and performing a Digital Maturity Assessment

The importance of a Treasury department in a commercial bank has increased in recent decades. After the 2008 financial crisis the remit of a bank Treasury has expanded in terms of scope and strategic significance, evolving from a transactional cash manager to a balance sheet custodian. In order to meet this broader strategic mandate Treasurers must consider ways to become more efficient and streamlined. Adoption of digital technologies and related innovation that underpins the Fourth Industrial Revolution can address many of the traditional Treasury challenges and deliver a wide range of benefits. The adoption of digital technology in bank Treasuries tend to be lower than in other business areas within a bank. There are a number of reasons, but it often includes the lack of a well-articulated digital transformation roadmap. There is thus a need for researching a Treasury specific approach that can provide guidance on developing a digital implementation strategy and enable the transition towards a next generation ‘smart’ digital Treasury department. This paper focusses on a key component of digital transformation, namely performing a Digital Maturity Assessment. It is essential to determine the digital maturity level of a Treasury function, in order to ensure the appropriate Treasury activities and digital technologies are identified and prioritized for digitalization.

Integrating Regulatory Technology (RegTech) into the digital transformation of a bank Treasury

The volume and complexity of financial regulations have increased significantly since the 2008 financial crisis. This has put increasing pressure on banks to monitor and report a range of intricate exposures to comply with new prudential requirements. Regulatory Technology (RegTech) is an emerging technology trend leveraging information technology and digital innovations that can greatly assist with a bank’s regulatory management process. A consideration is that these technologies can sometimes be expensive and inefficient if deployed on an ad hoc and stand-alone basis. An option is to incorporate RegTech into the digital transformation strategy of a management function such as Treasury. Integrated adoption would mean the digital platform can be deployed to support both strategic management activities and enhanced regulatory processes within Treasury, thereby ensuring commercial and prudential objectives are aligned. RegTech can provide an invaluable tool, in a business-as-usual environment, as well as in real-life stress events, such as the recent coronavirus outbreak. This paper explores the potential of RegTech and the merit of incorporating it into a Smart Treasury department.

Integrating Regulatory Technology (RegTech) into the digital transformation of a bank Treasury

The volume and complexity of financial regulations have increased significantly since the 2008 financial crisis. This has put increasing pressure on banks to monitor and report a range of intricate exposures to comply with new prudential requirements. Regulatory Technology (RegTech) is an emerging technology trend leveraging Information Technology and Digital Innovations that can greatly assist with a bank’s regulatory management process. A consideration is that these technologies can sometimes be expensive and inefficient if deployed on an ad hoc and stand-alone basis. An option is to incorporate RegTech into the digital transformation strategy of a management function such as Treasury. Integrated adoption would mean the digital platform can be deployed to support both strategic management activities and enhanced regulatory processes within Treasury, thereby ensuring commercial and prudential objectives are aligned. RegTech can provide an invaluable tool, in a business-as-usual environment, as well as in real-life stress events, such as the recent Coronavirus outbreak. This paper explores the potential of RegTech and the merit of incorporating it into a smart Treasury department.

Facilitating Climate-Smart Investments

The financial sector will play a key role in transitioning toward low-carbon and climate-resilient development, but financial decision makers need tailored information to guide climate-smart investment decisions. Here, we reflect upon the Sustainable Edge report and investor engagement to pilot a new approach to climate-risk assessment for companies.

The Changing Role of a Bank's Treasury

AbstractThis study investigates the contemporary role of banks’ treasuries and shows how the treasury function is being transformed across the banking sector. Using a sample of international surveys of banks representing both emerging and advanced markets (with 35% of banks representing the Asia–Pacific region), we analyze the current and future challenges faced by treasuries. Including the Asia–Pacific banks in the analysis enables comparison of how the treasury departments differ in their search of revenue diversification under the conditions of tighter credit and liquidity, and what are the problems associated with treasury products offering as part of the revised strategies.

The offshore city, Chinese finance, and British capitalism: Geo-economic rebalancing under the Coalition government

This article examines the embrace of Chinese finance under the United Kingdom’s 2010–2015 Coalition government. The article argues that the City of London’s centrality within British capitalism has been reinforced, not displaced, since the Global Financial Crisis. Geo-economic rebalancing towards China, not the Coalition’s professed spatial and sectoral ‘rebalancing’ ambitions, prevailed. To explain the City’s renewed pre-eminence in the wake of the crisis, the article draws upon a modified version of the ‘City–Bank–Treasury nexus’ theory of British capitalism. Breaking from structuralist approaches that underplay the City of London Corporation’s role within economic policy-making, the article illuminates the Corporation’s agency as a key parastate institution that reoriented the City–Bank–Treasury nexus towards Chinese finance under the Coalition.

Self-Funding Portfolios and Collateralised Derivative Pricing

A general framework is proposed for including the effects of collateral management in derivative pricing. Comprehensive yet simple formulas are obtained allowing the impact of different types of collateral agreements to be incorporated in valuations. The approach centers on analysing the self-financing condition on portfolios which explicitly include the market funding of derivative, collateral and hedging positions. Major simplifications, including a martingale pricing formula, are obtained when funding and collateral are in the form of cash, but the general framework aims at greater generality. The functional dependence of the collateral balance on the value of the derivative also plays a central role in the analysis. The “institutional” implications for liquidity management (pertaining to derivative desk funding, bank treasury “transfer pricing,” and the interplay with the repo market) are briefly considered.

Extending the New Technology Acceptance Model to Measure the End User Information Systems Satisfaction in a Mandatory Environment: A Bank's Treasury

On having implemented a new dealing rooms platform in a Bank's Treasury, themanagement identified a number of areas for further investigations of the end user acceptance of the newtechnology. Answers were sought to what extent dissatisfaction, if any, was influenced by the end users'perception of the system quality, subjective norms and computer self-efficacy. New technology acceptancemodels assume perceived 'usefulness', rather than 'ease of use', as a strong indicator of usage. The enduser satisfaction model was developed to measure the end user satisfaction in a mandatory environment,and to test the 'usefulness' versus 'ease of use' assumption. The findings suggest that in a mandatoryenvironment such as a Bank's Treasury, the perceived 'ease of use' was a marginal{y stronger influencerof the end user satisfaction. Demographic variables such as age, position in a company and the lengthof employment were other significant contributors to satisfaction. The implications of the findings for theBank's management are twofold: both 'computer self-efficacy', and the end user 'satisfaction' play amajor role in new technology acctptance, therefore the two variables require a particular consideration indesigning information systems in mandatory environments.