Corporate Treasuries

In the current environment, most organisations are looking at cost and service levels in their support functions. Of particular interest to many is the Corporate Treasury function which, although small in terms of headcount, is a key driver of the companies P&L. Additionally, business and accounting requirements are also driving corporate treasuries to re-evaluate their systems support and to assess opportunities for outsourcing.

Central to the process of change is a thorough understanding of an organisation's own costs and key performance indicators (KPIs) and how these costs compare to its peers. Although there are available figures for the overall cost of a transaction within wholesale financial services, there has been no detailed benchmarking across Corporate Treasuries and, as organisational structures differ widely, management have found it difficult to compare this data to their own costs.

Z/Yen has a long history of innovative work in both the Financial Services and the Corporate Treasury sectors and, in the last 4 years, has run many annual Competitive Cost Comparison (CCC) benchmarking studies covering "back-office & IT costs" over various products & markets. So far, over 25 major banks have taken part in these studies.

Each of these CCC studies follows a similar methodology whereby representatives from each of the participant organisations are brought together in a series of workshops facilitated by Z/Yen to define scope, standard definitions, data collection templates and report outputs. At the end of the workshops a deadline is set for data submission. Following receipt of data, Z/Yen perform a full validity check before reporting.

Z/Yen now propose to initiate a new CCC study into the Corporate Treasury area. The format of this study will follow that of the "back-office" studies, i.e., to capture cost, headcount & transaction volume data on: ¨ Products traded & processed, e.g., Foreign Exchange, Money Market Loans & Deposits, Debt & Repo and Derivatives; ¨ Activity types, e.g., trade execution & capture, confirmation, settlement and post-settlement activities such as risk and P&L processing and accounting activities.

To ensure confidentiality, each participant is given a unique code name under which all its data is indexed. Z/Yen, as the independent third party, acts as the repository for the data, collects information from each participant, collates the data into a set of benchmarks and then presents results to each organisation.

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