NeugroupNeuGroup News
April 15, 2021

COIN of the Realm: NeuGroup’s Cryptocurrency Education Campaign

The huge hype surrounding the Coinbase IPO this week is just another sign that finance teams trying to stay ahead of the curve can only benefit by boning up on Bitcoin and the rapidly moving world of cryptocurrency. NeuGroup is committed to helping members learn from those in the know. This week—before the IPO—Allison Rossi, treasury lead at the digital payments company Square, explained the decision-making process and logistics involved in the company’s $50 million investment in bitcoin, made in…
ComplianceFXNeugroupRisk Management
April 15, 2021

Adding Complexity to Hedging: An Adventure in Entity Restructuring

An FX risk manager faces hedging and forecasting challenges amid changes made in response to BEPS regulations. It’s no surprise that the 15-point action plan announced by the OECD in 2015 to address base erosion and profit shifting (BEPS) would create various headaches for finance teams at multinational corporations. But a member presentation at a recent meeting of NeuGroup FX risk managers provided a fuller picture of some specific challenges facing companies as they comply with the new regulations.At issue for…
NeugroupRisk ManagementTechnology
April 15, 2021

‘Heat Maps Must Die’: Out With the Old ERM Tools, in With the New

Critics say traditional tools are inadequate for illustrating risk; one ERM member has found success modernizing them.Pity the poor risk heat map. This well-worn tool, traditionally used by ERM teams to provide a visual representation of the range of risks a corporate faces, is now an object of scorn for some risk managers, including NeuGroup members. “Heat maps must die,” one member said at a recent NeuGroup meeting for ERM heads, a sentiment echoed by a number of his peers.Also…
Capital MarketsNeugroup
April 15, 2021

Fond of Fitch: Ratings Agency Gains Fans and Respect in Treasury

Members of NeuGroup for Capital Markets praise Fitch analysts and a ‘ratings-through-the-cycle’ approach.For decades, Fitch Ratings has been the third ratings agency—behind Moody’s and Standard & Poor’s—used by Fortune 500 corporates that want to ensure they maintain the two investment-grade ratings necessary to remain in the Bloomberg Barclays Bond Index. That may be changing.   At a recent meeting of NeuGroup for Capital Markets, members said they have been impressed with Fitch’s analysis over the past few years, and especially…
NeugroupRisk ManagementTreasury Management
April 13, 2021

Flying Higher: Moving ERM Beyond Safety Net to Strategic Partner

ERM is reaching new heights as risk exposures multiply and rising insurance premiums drive a search for options. Enterprise risk management is having a moment amid a seeming explosion of risk exposures facing corporates since the pandemic began. And as the function grows in importance, at least a few ERM teams are heading toward inclusion in corporate strategy groups—a trend definitely worth watching. One member at a late March meeting of NeuGroup’s Corporate ERM group said his goal since recently…
NeugroupNeuGroup News
April 9, 2021

NeuGroup Continues To Innovate and Refine Virtual Meetings

With 2021’s first-half meeting cycle underway, a message from NeuGroup founder and CEO Joseph Neu.  As we pass the one-year mark of pandemic disruption in most parts of the NeuGroup member universe, we are upping the ante further on our program of opportunities for you to share and learn with other members.    In this cycle, we are rolling out a new events calendar on our website. It is meant to keep you abreast of all the new programming available at NeuGroup to help you navigate the unprecedented change of our times. It also serves as a program guide for prospective…
BankingCash & Working CapitalNeugroup
April 8, 2021

Tapping the Power of In-house Banks to Turn Cash Puddles into Pools

Mega-cap treasurers and PwC discuss multiple benefits of IHBs and some complexities of structuring them. Treasurers not sold on the value of in-house banks (IHBs) often tell Damien McMahon, a partner at PwC, “We have cash pooling already, and therefore we have a kind of in-house bank,” he recently told a group of NeuGroup members from mega-cap companies. In reality, though, many of the treasurers may have what Mr. McMahon called “cash puddles,” not cash pools.PwC and treasurers from two member…
FunctionalNeugroupRisk ManagementTreasury Management
April 8, 2021

Making the Devil’s Advocate an Angel on Your Shoulder

NeuGroup risk managers make space for contrarians to question decisions and combat overconfidence.Rather than shunning contrarians for challenging conventional thinking, corporates need to make sure their decision-making processes always include a constructive devil’s advocate—someone who forces teams to consider all the ramifications of whatever action—or inaction—a company is contemplating. This was among the key pieces of advice given by Michael Zuraw, head of enterprise risk management at ON Semiconductor, during a presentation on decision-making at a recent ERM-focused NeuGroup meeting.…
BankingNeugroupTalking ShopTreasury Management
April 8, 2021

Talking Shop: Who Is Allowed to Open Bank Accounts at Your Company?

Editor’s note: The NeuGroup Process brings members together to solve problems and answer each other’s questions in a variety of forums, including online communities for specific groups—one of many benefits of membership. Talking Shop shares valuable insights from these members-only exchanges (anonymously) with all members and NeuGroup Insights readers. We welcome your responses—and any questions you want answered: insights@neugroup.com. Member question: “We are trying to do some benchmarking: Do your board resolutions allow the treasurer (and others?) to open bank…
BankingLibor SOFRNeugroup
April 6, 2021

Pricing Loans Using SOFR: Wait for Banks or Take the Initiative?

Members discuss the Libor-SOFR transition, including contracts and other non-treasury Libor exposures. Regulators want corporates and their banks to price new loans and other financial exposures using a USD Libor-replacement rate such as SOFR by the year-end deadline—just nine months away. But who should take the lead in this transition—the banks or the corporates? That question and other issues that companies confront relating to the move away from Libor arose at a recent meeting of NeuGroup for Capital Markets sponsored…