BANK TREASURY COURSE Presented by Mss. TCHATA CATHERINE in Yaounde Cameroon

BANK TREASURY LECTURE
Developed & Presented on Feb 2015
by Mss. Tchata Catherine

Developed By: Mss. TCHATA CATHERINE PRESENTATION PLACE -DATE
catherine.tchata@treasuryconsulting.info Cameroon - February 2015

THE LECTURE FEES CAN BE PAID ON OUR BANK ACCOUNT
D
Lecture fees Chose your Price
and pay the amount that
qualify your level of
satisfaction
Mss. Tchata Catherine
Bsc. MA. MBA.
Managing Director of
TREASURY CONSULTING INFO, sarl

COURSE OUTLINE
• DEALING ROOM STRUCTURE
• DEALING ROOM STAFF
• THE MONEY MARKET DEALING DESK
• THE DEALER’S LIMITS
• THE DEALER’S WORKFLOW
• DEALING ROOM COMMUNICATIONS & ETHICS
Developed By: Mss. TCHATA CATHERINE PRESENTATION PLACE - DATE

DEALING ROOM STRUCTURE
• IN THIS TOPIC WE EXPLORED
1. Foreign Exchange Dealing Desk
2. Money Market Dealing Desk
3. Corporate Dealing Desk
4. Dealing Room Review Question

• Foreign Exchange Dealing Desk
The Foreign Exchange desk specializes in foreign
exchange spot dealing and foreign exchange
forward dealing
• Money Market Dealing Desk
Money market dealing involves the borrowing or
lending of funds under agreed conditions. Money
market instruments include: call deposits, fixed
deposits, certificates of deposit, T-bills,
Commercial paper, Repos and bills of echange.

• Corporate Dealing Desk
This section of the dealing room facilitates requests from
corporate customers for specific deals in the money market or
the foreign exchange market. This section does not usually make
prices. Dealers act as salespeople’ in the dealing room.
• Dealing Room Structure Review Question
Corporate dealer act on requests from their customers for
specific deals in which one of the following dealing desk?
a) Money Market only
b) Foreign Exchange Market only
c) Money Market and foreign exchange market

• Answer to Dealing Room Structure Review Question
Corporate dealer act on requests from their customers
for specific deals in the:
a) Money Market only
b) Foreign Exchange Market only
c) Money Market and foreign exchange market
you are Right, the Correct answer is C) because
corporate dealer can facilitate requests for deals in both
the money market and the foreign exchange market.

1. Dealing Room Staff description
2. The Chief Dealer Position
3. The Senior Dealer Position
4. The Junior Dealer Position
5. The Money Market Dealing Desk
DEALING ROOM STAFF

• Dealing Room Staff
• The number of people in the dealing room can vary widely, but
the basic structure is fairly consistent. The chief dealer
supervises all dealing room activities.
• Each section is headed by a senior dealer, who supervises the
work of the other dealer, including junior and trainees.
• Let’s examine each type of dealer in little more detail.
DEALING ROOM STAFF

• The Chief Dealer
Chief Dealer are responsible for all activities in the dealing room. At
the end of each day, they receive a report on the day’s activities from
the various sections, although in practice these days chief dealers
normally are able to monitor dealer positions , profits and losses etc.
In real time.
Chief Dealers report to the senior management in charge of money
market operations, typically the Treasurer or Chief Financial Officer of
the Firm. They must also have a second in command to assume
responsibility in thier absence.
Developed By: Mss. TCHATA CATHERINE PRESENTATION PLACE -DATE
DEALING ROOM STAFF

• Senior Dealer
The Senior Dealer is responsible for all the transactions that take place in thier
section. The dealer will execute the customer orders but also run position for the
profit of the firm. This means they will buy and sell money or money market
product with the intention of making a capital gain, sometimes within the course
of a trading day, sometimes within the course of Trading day, sometimes over a
longer period of time.
Senior Dealer will report the section’s position to the chief dealer at the end of
the intention of making a capital gain, sometimes within the course of a trading
day, sometimes over a longer period of time.
Senior Dealer will report the section’s position to the chief dealer at the end of
the day and may also consult the chief dealer in the even of any problems that
may arise.
DEALING ROOM STAFF

• Junior Dealer
Junior dealers and trainees provide support to the
other dealers by keeping positions up to date,
keeping in touch with the back office etc.
They also learn how to run positions themselves,
although usually with vary limited amounts of risk.
DEALING ROOM STAFF

• Staff in Money Market Dealing Desk
The Dealer on money market dealing desk will normally be divided
according to currencies and products. For example, we could have a
USD (currency) deposit and CD (Call deposit) dealer, sitting alongside a
EUR denominated commercial paper dealer.
The Larger the dealing desk the more specialized the dealers can be. In
smaller dealing rooms they may have to cover many different markets.
Dealer will work within strick guidelines relating to the type of deals
they can undertake and also the counterparties with whom they can
deal. These are known as thier limits and are typically set for regard to
the amount of risk to which they migth expose the firm.
DEALING ROOM STAFF

THE DEALER’S LIMITS
A dealer’s limits can include the following:
1. Currency
2. Credit
3. Counterparty
4. Instrument
5. Maturity
6. Deal Size
7. Position

• 1) Currency
Different currencies have different volatilities and
therefore the firm may have to impose differing limits
according to the type of currency being traded.
• 2) Credit
Many money market transactions involve direct lending
and borrowing. This causes significant credit risk. These
risk have to be evaluated and then a limit is set according
to the creditworthiness, that is the ability to pay of the
name.

Information Relevant to Bank Accounts Opening
• 3) Location
The location of the account defines the legal framwork for the
operation of the account, and rules regarding if and how
interest is to be paid.
• 4) Currency
Account can be opened in local or foreign currency; can can
restriction for opening a foreign currency accounts.
Independant of the actual location of the account, the
currencies are always cleared in the country of the currency.

• 5) Maturity
Although most money market product cover a maturity of less than a
year, the dealer may still have differents limits imposed for different
limits imposed for different maturity products. Again, this is to give
protection against losses for less popular periods.
• 6) Deal Size
The size of a deal can directly link to the amount of experiences the
dealer is taking on their book. If a dealer is transacting a customer
order, for example buying from the market and then directly selling
to the customer, the deal size is not very relevant. If on the other
hand, the dealer is buying to hold on position there may well be a
limit to the maximum size they would be allowed to take a any one
time.

• 7) Position
Position limits will pay respect to all the other limits in terms of what
a dealer is allowed to hold and for how long. Position limits can have
two dimensions: dayligth limits and end of day limits. Daylight limits
are the positions the dealer can hold during the trading day when
they are there to monitor the risk. End of day limits are the positions
they can hold on thier books at the end of a trading period.
• 6) Deal Size
Adealer’s primary responsibilities relate to actual dealing and
position taking. This includes:
• Proper recording of all transactions
• Maintaining and monitoring of all position record
• Compliance with intenal and external limits and regulations

• 8) Position Taking
Position taking refers to the process by which a
dealer buys or sells financial instruments,
currencies etc. In anticipation that their prices
will subsequently move in a certain direction. If
price move favorable, the position taken will be
profitable for the dealers.
REVIEW QUESTION of DEALING ROOM STAFF

Review Question of Dealing Room Staff
• Which one of the folowing staments is correct in
relaton to dealing room staff and structure?
1. Due to the short-term nature of money market instruments, maturity is not a
factor in setting limits for money market dealers.
2. End of day limits are limits on the position the dealer can hold during the
trading day
3. There is no limits to the deals a dealer can transact with a particular
counterparty
4. A dealer may have different limits for different currencies traded
Answer: you are rigth  because the correct answer is 4 and not 3 because there
are limits on the size of transaction that a dealer can have with a counterpaty.

Thank You For your Attention !

BANK TREASURY COURSE Presented by Mss. TCHATA CATHERINE in Yaounde Cameroon

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