Transaction Efficiency Analysis

Transaction Efficiency Analysis (TEA) | Identifying opportunities and quantifying benefits of digitalized FX risk management 3 In order to visualize this concept, we are proposing a suite of reporting capabilities termed TEA. TEA is designed to enable CFOs and corporate treasurers analyze the efficiency of their FX and payment processes not only on a standalone basis but also in comparison with their peers. Peer benchmarking allows them to compare execution methods, channels, and automation levels in comparison to other corporates within the same or a similar industry. Increasingly, corporates have deployed automation and efficiency as strategic implements to create a distinct competitive advantage over their peers, and in the sphere of treasury transformation, it is critical to stay very close to your peer group, or better yet, to lead the pack. A Vertical TEA report would consider automation on either a global scale or regional level depending on the transformation roadmap of a corporate treasury and where on the evolution the treasury is present. This report would primarily focus on trade execution and key considerations for this TEA report would be: • Execution channel (voice vs platform-based execution) • Quality of automation (i.e. platform-based execution vs end-to-end connectivity) • Deal-size analytics (with a focus on small-value trades) • Tenor analytics • Analytics on FX Hedging Instrument (e.g. spot, forward, options) Increasingly, clients should be looking to add efficiencies across their entire trade lifecycles and peripheral activities such as onboarding and day-to-day management for electronic platforms. In a number of emerging markets, physical documentation is still prevalent for confirmations and trade- support purposes. Onboarding new users on banking platforms needs to follow the local regulatory and legal processes, which invariably involves paper documentation and manual interventions. Treasurers do not have visibility over these processes even though this is where there are usually unique opportunities for transformation and digitalization. The Horizontal TEA Report aims to give clients an overview of subsidiary-level automation in detail by taking into account pre-trade and post-trade activities. Key considerations for this report would be: • Post-trade automation, i.e. confirmations and settlements • Pre-trade automation, i.e. incorporation of regulatory workflows and digitalization of regulatory documents • Onboarding and security-related efficiencies Volume (USDm) Number of tickets (USDm) Country Channel Connectivity % Single dealer platform % Voice % Connectivity % Single dealer platform % Voice % Argentina 31 67 0 0 15 33 114 94 0 0 8 6 Bahrain 0 0 8 100 0 0 0 0 22 100 0 0 Bangladesh 0 0 0 0 20 100 0 0 0 0 120 26 Brazil 0 0 20 10 180 90 0 0 327 37 560 63 Brazil 0 to 500k 0 0 11 55 35 20 0 0 316 96 385 69 500k+ to 1m 0 0 6 30 88 49 0 0 8 3 150 27 1m+ to 5m 0 0 3 15 37 20 0 0 1 21 3 5m+ 0 0 0 0 20 11 0 0 0 0 4 1 China 0 0 33 21 127 79 0 0 55 68 25 32 Colombia 29 100 0 0 0 0 77 100 0 0 0 0 India 0 0 0 0 122 100 0 0 0 0 0 0 Morocco 0 0 0 0 17 100 0 0 0 0 0 0 South Africa 28 100 0 0 0 0 25 100 0 0 0 0 Total 88 14 61 10 481 76 216 16 404 30 713 54 Client target is 10% Vertical TEA Report Region Country Entity STP FX confirmation Segregation of duties Administrator APAC Bangladesh Company XYZ Bangladesh Two-way Paper Maker-checker Sam Park APAC China Company XYZ China Two-way Paper No Sam Park APAC India Company XYZ India No Swift No Sam Park EMEA Bahrain Company XYZ Bahrain Two-way Waiver No Jane Brown EMEA Morocco Company XYZ Morocco One-way Email No Jane Brown EMEA South Africa Company XYZ South Africa API Swift/Misys No Jane Brown LATAM Argentina Company XYZ Argentina No Not required No Jose Ruiz LATAM Colombia Company XYZ Colombia One-way Not required Maker-checker Jose Ruiz LATAM Brazil Company XYZ Brazil Two-way Not required Maker-checker Jose Ruiz Horizontal TEA Report