Alliances & Partnerships: PwC Singapore

We are pleased to announce that PricewaterhouseCoopers LLP (PwC LLP) Singapore has selected our fully integrated suite of Risk, Treasury Management and IAS Compliance modules to underpin their treasury advisory and outsourcing business. PwC LLP is now able to offer a full suite of treasury solutions ranging from advice on risk policy design, board reporting and specialised risk analysis through to outsourced back office treasury services. The service can now deliver Singaporean and Malaysian companies the powerful functionality of the full Visual Risk system at a fraction of the cost of an in-house system along with the backing of PwC's team of dedicated treasury specialists.

"PwC LLP Singapore's, selection of Visual Risk once more underpins our growth and market leadership in this region" says Richard Hughes, Managing Director of Visual Risk. "Together with PwC, we believe this unique new service will revolutionise the way businesses manage their treasuries in Singapore and Malaysia".

PwC LLP Partner Chris Matten highlights the benefits of this new strategic alliance: "With Visual Risk we can deliver a broad range of consulting and outsourcing services to all sizes of business, with full support from a global network of treasury and market risk experts," he says. "This cost effective service is underpinned by the latest treasury solutions developments and best practice techniques made available by Visual Risk. It means we can provide clients with a full range of services covering all aspects of risk analysis - from specialised 'at-risk' modeling and 'stress testing', to seamless fully outsourced middle and back office treasury services."

"PwC LLP" refers to PricewaterhouseCoopers LLP, which is a member firm of PricewaterhouseCoopers International Limited, each member firm of which is a separate legal entity.

A Welcome to our new clients

The Visual Risk client base continues to expand. We would like to welcome the following new clients:

Bank of Cyprus Australia
Community Mutual Group
EECU
Macarthur Credit Union
Sutherland Credit Union
Rural Finance

Please click here for a more comprehensive list.

Functionality Focus: End-to-End Treasury Management for financial institutions

The recent string of consolidations among financial institutions in this region has accelerated demand for in-house systems capable of providing advanced asset liability management along with fully integrated treasury management.

Visual Risk is well-known in Australasia for its market-leading ALM solution but we also provide a full back office and hedge accounting capability for organisations that require a single end-to-end system.

We support our customers to manage the full range of back office activities from deal capture through to general ledger postings. This year, our commitment to new functionality has delivered a number of new releases including cash management, liquidity forecasting and performance-to-budget reporting.

This continuing investment in fully integrated treasury solutions has enabled our customers to finally abandon a multitude of spreadsheets and consolidate all treasury activities within Visual Risk.

Community Mutual Group selects Visual Risk as their Treasury Management System

The Community Mutual Group (CMG) combines three regional Credit Union brands; Hunter Mutual, Orana Mutual and New England Mutual that have combined to form a strong, regionally based financial institution. With over 70,000 members and assets of close to $1 billion, CMG is one of the leading providers of financial services in the areas in which it operates and is the largest inland community credit union in Australia.

CMG has become the most recent mutual to select Visual Risk as their Treasury Management system. The key objectives in implementing the Visual Risk software are to improve operational efficiencies, introduce robust treasury processes and to put in place controls to mitigate treasury related risk whilst producing accurate risk reporting.

Visual Risk is an ideal solution for those mutuals and regional ADIs that are now setting up a formal treasury function or looking to improve their existing treasury processes.

Bendigo-based Rural Finance successfully implements Visual Risk

Rural Finance has close to $1.5 billion of assets under management and has been a specialist provider of finance to the rural sector for more than 60 years. It has a network of offices across regional Victoria.

Rural Finance had for many years been using an in-house developed solution for the management of their interest rate risk. Visual Risk was identified and selected as a suitable replacement for this in-house system with the key objective being the timely production of accurate risk reporting within a more secure and robust environment.

Jason Dullard, Treasury Accountant at Rural Finance explains:

“Our client base is exclusively in the rural sector. As such, the key challenge during the implementation of Visual Risk was to model and correctly capture the impact of the inherent seasonal variations that occur in the borrowing and repayment profile of our agricultural clients. We were very pleased with the flexibility and adaptability of the Visual Risk solution to cater for our unique requirements. It is now our primary interest rate risk management and budgeting and forecasting tool.”

Visual Risk is a highly adaptable solution that can be tailored to the unique requirements of any financial institution.

MyState Financial extends use of Visual Risk to include Treasury Management component

MyState Financial is a Tasmanian-based ADI with assets of $1.5 billion under management. They are a long term user of the Visual Risk Asset Liability Management solution and recently extended their use of Visual Risk to include our back office Treasury Management component.

William McShane, Treasurer at MyState, explains how by adding the Treasury Management component, Visual Risk has delivered a complete end-to-end solution for their treasury operations:

“MyState Financial implemented Visual Risk in September 2007, initially utilising the ALM module to manage the organisation’s interest rate risk. More recently we have upgraded our installation to include the Treasury Management (TM) module. Visual Risk is now MyState’s primary treasury platform, catering for all aspects of treasury from market risk management through to daily operations. Most notably, the decision to implement the TM module of Visual Risk was made in order to achieve several key benefits:

1) To provide management with a secure system to capture corporate investment and deposit deals;
2) To provide a strong internal control solution to protect assets;
3) To allow stronger reporting options for the investment and depositing portfolios;
4) To expand on credit risk reporting for internal risk management; and
5) To provide “what if” analysis for management;

I believe the TM module of Visual Risk has delivered on these key benefits.”

Discussion Point: Liquidity Risk

In the wake of the GFC, liquidity risk management and reporting have become key concerns for most ADIs. APRA and the RBNZ are currently developing and implementing new liquidity standards based on the Basel Committee’s framework for global liquidity standards.

In Australia, APRA’s implementation of the Basel Committee’s framework is occurring under APS 210. The new standard will come into effect on 1 January 2015 and will be subject to consultation during 2011 and 2012. APS 210 requires that larger internationally active banking institutions will need to meet new Liquidity Coverage Ratio (LCR) requirements. In order to meet the LCR requirements, participating ADI’s will have to maintain sufficient high-quality liquid assets to survive an acute one month stress scenario.

However, most smaller Australian ADIs such as credit unions and building societies will not compulsorily be required to run an acute one month stress test scenario. They will continue to be regulated by the current Minimum Liquid Holdings (MLH) regime as this simple quantitative metric is viewed to be working effectively for ADIs with simple, retail-based business models. For those who wish to take a more rigorous approach to liquidity risk management, a one month stress test should still be considered as the best practice option, regardless of any specific regulatory requirement.

In New Zealand, the RBNZ’s prescribed liquidity reporting requirements are at a more advanced stage. Importantly, they differ for ADIs depending upon whether they are classified as a ‘registered bank’ or otherwise. For registered banks the RBNZ has set out stringent principles for management and reporting liquidity risk in prudential standard BS13. This requires that they apply a one-week mismatch ratio, a one-month mismatch ratio and a one-year core funding ratio and the calculation of these key ratios is carefully prescribed in the standard. The RBNZ has set aggressive minimum ratios and earlier this year, the core funding ratio was lifted from 65 to 75 per cent.

Visual Risk will continue to monitor the impact of changing liquidity standards through ongoing consultations with our clients and regulators. The recent release of our enhanced liquidity reporting functionality once more affirms our commitment to keeping Visual Risk up-to-date with best practice prudential reporting and evolving client requirements.

Upcoming Events: Abacus Annual Australian Mutual Institute Conference

Visual Risk will be exhibiting at the Abacus / Annual Australian Mutual Institute Conference in Cairns later this year. We hope to see you there from 22 - 26 October 2011
Location: Cairns Convention Centre, QLD