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Foreign Exchange Risk?
Get in touch with Sander van Tol or Lisette Overmars for more information about Foreign Exchange Risk.
Foreign Exchange (FX) risk management is driven by the corporates FX objectives, policy and strategy and is enabled by the implementation of a good FX risk management process.
In order to implement a good FX risk management process companies can apply the Zanders corporate risk management framework starting with identification of different kind of FX exposures, as follows :
The FX objectives are defined to facilitate proper management of the impact of FX movements on the corporate business. Expected cash flows can deviate significantly when calculated according to the functional currency of the company over time due to FX volatility. The company’s decision on the level of acceptable risk needs to be embedded in the FX objectives. Leading objectives for corporates to manage their FX exposures:
The provision of market data to support not only an organization’s treasury function but the wider business functions can become a time-consuming and potentially complex exercise. It is no longer ju...
Implementing a hedging strategy to hedge against one common currency (the “base” currency) in SAP Treasury may be a daunting task, but in isolating and focusing on the individual building blocks r...
Compared to their Western counterparts, Asian corporate treasuries have had to grow and learn to react to business complexities and changes in their environments very quickly. Western corporations hav...
The start of a new year (not to mention a new decade) is a natural moment to reflect on the past and look forward to the year(s) ahead. How should you, as a treasurer, prepare for the uncertain future...
Is there a direct relationship between your FX exposures and the resulting P&L effects? Have you ever thought about hedging with FX options instead of FX forwards but then ruled it out? Here are some ...
In September 2018, Zanders organized and hosted a round table session on the topic of Advanced FX risk management. Leading practitioners from various multinational companies actively debated a selecti...
When multinational companies present their financial results, material foreign exchange (FX) fluctuations are often cited as a cause of the unexpected results.
The importance of FX risk management has grown significantly in recent years on the back of market volatility, increased geopolitical risk, and also regulatory and accounting changes. International ex...
Geopolitical instability has always had an impact on foreign exchange (FX) markets, increasing the volatility of FX rates. More recently, the rising tensions between the US and North Korea, as well as...
Behavioral finance was first taught in universities at the beginning of the new millennium. Before that, traditional economists based their theories on the assumption that efficient markets are driven...
We are delighted to announce that our client Türk Telekom is the highly commended winner for the Treasury Today Adam Smith Awards for “Best Foreign Exchange Solution 2016”.
The increased volatility in the commodity and foreign exchange markets, augmented counterparty risk and the low interest rate environment have led to an increased focus on financial risk management (F...
At the end of February 2016, Prime Minister David Cameron announced that Britain would have a referendum on 23rd June 2016 to vote on whether it will remain in the European Union (EU). The referendum ...
As well as being a member of the board of the DACT (Dutch Association of Corporate Treasurers), Bart-Jan Roelofsz is mainly known as group treasurer and insurance manager at Endemol Shine. This enter...
The regulatory liberalization and ongoing developments in the Chinese market come with many opportunities for corporates with business in China. Treasurers should evaluate how to use the renminbi (RMB...
Visual Risk and Zanders collaborate to take corporate financial risk management to the next level.
The opening of business opportunities in emerging markets and their increasing relative importance for corporates in Europe and the US put extra pressure on managing foreign exchange (FX) risks. Es...
According to Intrum Justitia, bad debts of more than € 350 billion were written off in Europe in 2013, which is around three percent of all outstanding transactions. Internal research into Dut...
Integration between treasury and the wider business is a prerequisite for an effective and efficient treasury organization. The remit of the treasury function has changed in recent years so that tr...
"I've heard a lot about making sure treasury is a strategic partner to the business. Can you clarify what steps treasurers can take to achieve this and what are the benefits?"
At the end of 2013 the Renminbi - or People’s Currency - entered the world’s top ten most-used currencies for payments in terms of value. Being part of daily business for companies trad...
Zanders Treasury & Finance Solutions (Zanders) is pleased to present the gtnews 2013 Treasury Risk Survey. This survey has been conducted in close co-operation with the Association for Financial P...
When drawing up an effective FX risk policy to mitigate the transactional currency risks of a company, the definition of the objectives as well as the hedge horizon and hedge ratios are important e...
Export companies are by definition focused on international markets. Despite the promise of increased revenues, exports inherently increase the exposure to currency and other financial markets. Rec...
Risk management is evolving and adapting to the external factors that provide strong incentives to develop new risk management techniques. Whether this is because the world has become riskier or ...
Throughout 2009, volatility in the foreign exchange markets was a key theme. Although the financial markets calmed a little, corporate treasurers still face an environment in which their risk manag...
Türk Telekom, with 175 years of history, is the first integrated telecommunications company in Turkey. Due to its long-term foreign currency funding structure, Türk Telekom has significant foreign e...
With its expansion in Asia, Bucher Industries faced a tradeoff between local currency funding or central intercompany funding in Swiss francs for its foreign subsidiaries. This choice has an impact on...
As a big Dutch multinational, Philips is certainly not immune to the risks of global exchange rates. Fluctuations between different currencies have a significant impact on the incomes and financial st...
Accell Group is internationally active in the middle and higher segments of the market for bicycles, bicycle parts and accessories. Yearly, it sells around 1.7 million bikes in more than 70 countries....
More than 400 years after the Dutch East India Company was set up, Acomo, a group of seven trading companies, deals in products which are reminiscent of the golden age of the Republic of the Seven ...
Bertold Walther: “Liam and Sebastian had a very fast understanding of our problem. Within a few sessions, we have been able to set up a hedging policy. Which was the goal of our collaborat...
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Hedging of SARON exposure, Part II
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