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Risk Management

Cash & Working CapitalRisk Management
May 24, 2023

Debt Limit Deadline Dialogue: Risk, Revolvers, Fiduciary Duty

Finance teams discuss liquidity, parking cash, the big economic picture and treasury’s role as the clock ticks to June 1. Bank deposits, the safety of money market funds (MMFs), de-risking balance sheets, fiduciary duty and revolving credit facilities are among the topics dominating recent discussions among NeuGroup members about liquidity and the possibility of the US government defaulting on its obligations if a deal to raise the debt ceiling isn’t reached by June 1. Watching and waiting. The vast majority of…
Justin Jones
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Cash & Working CapitalRisk Management
May 18, 2023

Preparing for the Worst in the Debt Ceiling Showdown

As June 1 draws close, treasury teams need to consider how a default might affect liquidity and what to do now. Treasury Secretary Janet Yellen repeated on Monday that if the debt limit isn’t increased or paused, the US will probably be unable to pay all its bills as early as June 1. And while the worst case scenario of a default seems unlikely, few observers see a quick fix to the problem, despite Tuesday’s meeting between President Biden and…
Justin Jones
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Cyber riskRisk Management
May 18, 2023

A Cybersecurity Policy That Adapts to the Time and the Place

Dark web monitoring and burner phones are among the ways members are minimizing risk in the modern world.In a world increasingly plagued by ransomware, and now the threat of AI-driven mischief fueled by the rise of large language models like ChatGPT, it’s time for cybersecurity policies to adapt with the times, according to members of NeuGroup for Enterprise Risk Management. At the group’s first-half meeting, one member shared their experience leading a company-wide initiative to create a comprehensive cyber risk policy. A guest…
Antony Michels
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BankingRisk Management
April 27, 2023

The Big Picture Beyond Banks: A Holistic View of Counterparty Risk

A good risk management system requires a list of all exposures, according to CFO.University’s Steve Rosvold. The Silicon Valley Bank crisis raised concerns for many corporates around bank counterparty risk—but counterparty risk goes beyond just banks, as companies are also exposed to the actions of customers, vendors and investors. In order to effectively manage these risks, it is essential for a finance team to adopt a holistic approach that tracks all sources of exposure. That’s one takeaway from an upcoming…
Justin Jones
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Risk ManagementTalking Shop
April 27, 2023

Talking Shop: Bank Counterparty Risk: Does the Branch Matter?

Editor’s note: NeuGroup’s online communities provide members a forum to pose questions and give answers. Talking Shop shares valuable insights from these exchanges, anonymously. Send us your responses: [email protected]. Context: The crisis of confidence ignited by the flameout of Silicon Valley Bank prompted finance organizations at multinational corporations to ask a plethora of probing questions about bank counterparty risk and the safety of corporate cash. Though some questions have been answered and appropriate actions taken, ongoing fears around midsized regional banks like First Republic are causing…
Justin Jones
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RegionalRisk Management
April 20, 2023

Russia Pain: OFAC Answers NeuGroup Members’ Sanctions Questions

Compliance officers at the Office of Foreign Assets Control offer insights on bank sanctions and licensing issues.At a meeting this week of NeuGroup’s Russia-Ukraine Crisis working group, a compliance officer from the Office of Foreign Assets Control acknowledged that the significant reduction in unsanctioned banks available to work with multinational corporations in Russia presents obstacles to companies authorized to do business in the country under US and other sanctions regimes, including firms supplying medicines. The session, moderated by NeuGroup senior executive advisor Paul…
Justin Jones
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Capital MarketsRisk Management
April 6, 2023

Volatile Rates Spark Corporate Interest in Pre-Issuance Hedging

Multiple members have executed pre-issuance hedges in recent weeks, with many more strongly considering them. Extreme volatility in interest rates is fueling strong interest in pre-issuance hedging among NeuGroup members who want to mitigate risk—especially those who plan to issue fixed-rate debt in 2023. At the first-half meeting of NeuGroup for Capital Markets sponsored by Chatham Financial and Loop Capital Markets, members and representatives from Chatham agreed that this is an opportune time for companies to consider pre-issuance hedging, particularly using forward-starting swaps.…
Justin Jones
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Risk ManagementTechnology
March 30, 2023

DIY with RPA: A Tool Removes the Pain of CSA Collateral Exchange

UPS and Coca-Cola describe automation solutions they made using UiPath to cut time exchanging cash, reconciling. Artificial intelligence and machine learning may ultimately be major forces in the digital transformation of finance orgs. Right now, though, more NeuGroup members are bringing the future forward and scoring wins with robotic process automation (RPA) solutions that can relieve the pain and drudgery of manual processes that take way too much time. To wit: two members of NeuGroup for Mega-Cap Assistant Treasurers—UPS and Coca-Cola—recently explained how they used RPA…
Justin Jones
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Risk Management
March 23, 2023

Hedging Commodity Risk: How Polaris Put the Pieces Together

Treasury, backed by the C-Suite and Chatham Financial, worked with procurement to better manage commodity risk exposure. Starting or reviving a commodities hedging program requires risk managers in treasury to collaborate with procurement teams and secure the backing of the C-Suite to overcome challenges in securing changes in contracts that facilitate the use of hedge accounting. In addition, some corporates will benefit from having a knowledgeable advisor help navigate the complexities of hedging commodities. Those are few of the takeaways…
Justin Jones
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BankingRisk Management
March 16, 2023

Finance Fallout: SVB’s Head-Scratching Risk Management Failure

SVB insights from NeuGroup founder Joseph Neu and senior executive advisors Paul Dalle Molle and Jerry Olivo. Financial crises like the failure of Silicon Valley Bank reveal the grit, dedication and skill of first-rate treasury and finance teams—and their ability to manage risk when battling forces they can’t control. Upheaval, volatility and uncertainty also test the mettle of NeuGroup, whose mission is to help members, sponsors and partners withstand the blows. Hours after regulators shut down SVB last Friday, the…
Justin Jones
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