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Deutsche Bank’s Dieter Stynen discusses achieving clarity around FX transactions in Cash and Trade

Dieter StynenIn a recent article in Cash and Trade, Dieter Stynen – Global Transaction Banking FX at Deutsche Bank – writes about how corporates can minimise FX costs. The article explains how treasury departments contribute to goals of revenue maximisation and how one particular area – FX payments – remains an issue for them.

Gulf treasurers are operating in a region where trade flows with Europe are decreasing and being replaced with growing flows with Latin America and Asian markets. Yet, with the increase of counterparties trading in volatile currencies, this also increases pressure to reduce FX risks in order to remain competitive, despite many solutions to mitigate FX costs being costly and high risk themselves.

FX risk, of course, is just one aspect. Treasurers are not free from corporate-wide pressures. The article explains how even though pressure to mitigate currency exposure has increased, there still looms a transparency black hole.

Indeed, some treasurers are kept in the dark over FX exposure. If cross-currency payments were to be processed using a real-time rate, the treasurer might feel confident operations are going well. Yet, this is not the case – many banks use a fixed FX rates for cross-currency payments. To read the full article, please click here.

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