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The first months of 2020 have seen much greater volatility than usual in the FX markets and increased the importance of regular client contact, reports Rachel Whelan, Deutsche Bank’s Global Head of transactional FX Product Management and APAC Head of Cash Product Management.
“We’ve been proactively taking the message to our clients that we can help maintain their liquidity and support their FX needs,” she says. “The dynamic of command and control has been very evident, with treasurers needing total visibility, getting it earlier and in a real-time manner. Deutsche Bank provides them with that visibility by monitoring the markets closely and communicating with clients on a regular basis.”
The trend to greater digitization will also see more companies take up e-solutions, predicts Whelan. “The pandemic underlined the number of processes that include documents where signing of hard copies is still required – for example booking FX trades in the Philippines. Corporates are also interested in electronic solutions across Asian markets to support FX hedging and FX payments and collections, a demand that we are seeing an increase significantly.”
“It has emphasized the need to influence the regulators so that authorizations for digital documents can be fast-tracked. This means changing attitudes in locations such as Taiwan, where many still harbour suspicions of e-solutions and continue to rely on paper.”
Whelan adds that the region’s more forward-thinking governments recognize the need for change in testing times and have swiftly responded. She cites the example of Singapore, where the city state’s closed restaurants were brought together with delivery services so locked-down households could order meals. “Singapore’s government has been proactive in understanding the many problems that the pandemic has created for businesses and new arrangements have been swiftly introduced.”
Treasuries must take a leading role in helping to change attitudes, with a greater need for a command and control approach going forward adds Whelan. “They will need as much visibility as possible in making decisions and we will provide them with the tools for the job, such as dashboard solutions allowing quicker decision making and if, for example, they make the decision to start buying from Indonesia rather than China, we have the product and support capability they need. Treasury will need to manage risk in a much more dynamic way as global companies continue to work from multiple locations.”