Building the corporate treasury function of the future

The corporate treasury function has evolved rapidly in recent years, fuelled by digitalisation, increasing regulation and a changing macro-economic environment.

The core functions have not changed, but how those functions are performed and the additional value that can be added around them, is continually evolving. By adopting new enabling technologies and digitising processes, treasurers can improve automation, efficiency, and accuracy, while reducing risk and enhancing the role of treasury as a strategic partner to the business.

Strategic potential

Abu Dhabi Commercial Bank (ADCB) is leading the way in the UAE in leveraging technology to deliver broader, more responsive, and more strategic solutions that enable corporate treasury functions to meet the growing expectations of their clients.

ADCB is working with multiple treasurers who are upgrading their treasury management system (TMS) and Enterprise Resource Planning system (ERP) to support connectivity, for example, including the use of APIs and Swift to drive automation, as well as enabling information to be shared on a near-to-real-time basis, and providing automated reporting that supports streamlined reconciliation. Similarly, its digital supply chain platform enables seamless, paperless transactions between all parties, helping to facilitate liquidity management, aid cash forecasting and optimise conversion cycles; while the bank’s liquidity management solution enables it to tailor effective structures to support centralising cash positions through automation.

The solution provides 24/7 online access to a consolidated cash position and tools to empower treasurers in managing their liquidity either locally or globally in a fully automated and seamless manner. It provides a consolidated overview of companies’ structures and balances across all accounts, enabling treasurers to control budgets across subsidiaries, change sweep types according to needs and access customisable dashboards in a single click.

A case in point is its work with a client that included seven different business verticals with over 100 accounts overseen by a central treasury function.

Key challenges faced by the client were the overall visibility of daily cash management and working capital needs at the group level. Enormous time and effort were being spent on reconciling multiple accounts across different verticals and subsidiaries. The cash surplus was not being efficiently optimised and was only sporadically centralised at head office.

ADCB’s team invested considerable time working with the client to understand its reconciliation operations and pain points. As a result, the solution implemented combines different products and customised reports that automate the client’s operations across the seven business verticals, providing full visibility and control at head office, while maintaining the subsidiaries’ autonomy for collections and payments processing. The solution comprises multi-level two way sweeping, daily budgets at business vertical level, end-of-day cash concentration to treasury head office, host-to-host and customised reporting with different frequencies auto-mapped to the client’s ERP for auto-reconciliation and dashboards.

Optimising payments

Developments in the payments sector have also progressed at a rapid pace over the last decade. The need to enable a real-time or near-real-time, multi-currency, 24/7 payments capability is a growing focus for treasurers looking to optimise cash flow. From a consumer perspective, the main drivers are convenience and speed – expectations that are increasingly prevalent in the corporate space, where the need for fast, constant access to data is becoming the norm. As such, banks are having to continuously adapt to keep up with the growing demands.

Here, too, ADCB has enhanced its payments landscape through its continual investments in digital systems and channels. Its flagship ProCash platform provides a highly reliable and secure online banking cash management solution. It enables companies to initiate, reconcile and manage multiple types of payments, providing an exceptional level of customisation to meet specific needs. Through ProCash, more than 90% of transactions achieve straight through processing (STP), without the need for any manual intervention. The platform also provides real-time full visibility of the payment lifecycle using Swift GPI integration. Swift is also helping to simplify treasury and cash management processes. This reduces the risk of errors while providing global reach, enabling companies to manage their financial transactions and accounts with enhanced visibility and security.

Success through partnership

Working with a banking partner with a strong track record of digital innovation and client focus is essential if corporate treasury functions are to fulfil their potential as valued, strategic business in this fast-digitalising world.

With its reputation as one the Middle East’s most innovative banks, ADCB is well placed to provide the solutions, systems and support that enable corporate treasury functions to achieve their objectives and build long-term success.

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