Treasury management is the process of administering a business's financial assets and holdings to optimize liquidity, make sound financial investments for the future, and reduce financial risks. The treasury management department manages cash flow, investments, hedging, and banking relationships to maintain the company's liquidity and profitability while minimizing currency and other financial risks. Recent developments in treasury systems include greater automation, streamlining of functions, centralized management models, outsourcing of certain activities, and electronic processing to improve efficiency, cost savings, and strategic decision making.

1. Presented By:
Parakramesh Jaroli
MBA (Dual) II - Semester

2. Treasury ManagementTreasury Management
Definition:Definition:
The The processprocess of administering to the of administering to the financial assetsfinancial assets
and and holdingsholdings of a of a businessbusiness. The . The goalgoal of most of most
treasury management treasury management departmentsdepartments is to optimize is to optimize
their their company'scompany's liquidityliquidity, make sound , make sound financialfinancial
investmentsinvestments for the future with any for the future with any excess cashexcess cash,,
and reduce or enter into and reduce or enter into hedgeshedges against its against its
financial risksfinancial risks..

3. The Role….The Role….
■ Managing Asset & liabilities of the bank.
■ Managing 'gaps' and the 'risks'.
■ Maximizing profits operating within acceptable risk
parameters.
■ Maximizing yield on treasury/inter bank investment.
■ Providing rates to branches and customers.

4. Functions of a Treasurer/Treasury DepartmentFunctions of a Treasurer/Treasury Department
Cash Management
Fund Management
Currency
management
Banking and custody
Investors relation
■ z

5. Function of Treasury Management:Function of Treasury Management:
1. To maintain the liquidity of business:
It is the main function of treasury management to maintain the liquidity of
business. Without proper liquidity, it is risk for business to operate smoothly.
By using cash flow analysis and working capital management. Treasury
officer make good ratio of liquid assets and liquid liability.
2. To Minimize Currency Risk:
Treasury managers have to keep an eye on currency market of world. They
analyze the reason of crisis in currency market. Sometime this crisis will be
benefited for them because they have to pay less to other country for getting
their service at cheap rates.
3. To provide quick finance to Company:
It is also function of treasury department to supply quick finance to
company, when it needs the money. For this, a good network in financial
market is required.

6. Treasury Management and its FunctionsTreasury Management and its Functions
■ With the growth of International business and the spread of
Multinational Companies, the treasury function has
acquired a new meaning.
■ It is the management of cash, fund, currency, bank and
financial risk. So, it is an imperative tool of finance. In
this management, finance manager checks the cash
inflow and outflow. He makes the list of all receivable
amounts which will increase treasure house
of company.
■ Treasury department makes map to collect for govt.
treasure and decide how to use it for welfare works.
■ Finance manager creates good relationship for getting
locker facility at cheap rates and company can keep its
important documents in locker of banks.

7. TREASURY
Front Office
Lending to
BranchesBorrower
Investment
Reserve
Requirement
Depositor
Branch
Excess
Liquidity
Borrowing
Funding
Spread
• Branches Receive Deposits
• Branches Lend To Customers
• Branches Remit Excess liquidity to try at an average rate (Pool Rate)
• Try maintenance reserve with SBP.
• Invest in MM Instruments
• Invest in Govt. Securities
• Invest in Debt Securities
• Capital Market
• Fund FCY Trade Nostro Account
• Lend to Other Branch
Treasury
Back Office
Functions
Functionality….Functionality….

8. Manage the treasury-related processes and activities includes:Manage the treasury-related processes and activities includes:
■ Bank relationship management: Coordination and optimization of the
presence of bank partners in the financial markets, selection and
maintenance of access to a diversified range of banks and lenders in order
to limit the increasing counterpart risk from bank exposure.
■ A management overview of all bank accounts and corresponding
transactions and the electronic transfer of bank statements.
■ Fully automated processing of global internal and external payment
transactions
■ Centralized management of interest-rate, currency, liquidity and credit risk,
as well as security prices and certain commodity price risks
■ Accounting for all financial processes, including fully automated posting of
all transactions
■ Management of short-term liquidity to ensure the ability to pay all liabilities
using cash pooling and longer-term liquidity management
■ TM manage and monitor all Group activities on capital markets, including
bond issues and negotiations of credit lines.
■ Furthermore, we advise and educate all topics related to interest-rate,
currency, cash and credit-risk management, financial issues during the M&A
process.
■ Short-term trade receivables and actively manage the Group’s credit risks
by selling or hedging exposure to specific customers.

9. Recent developments in treasury systemRecent developments in treasury system
■ Information Technologies: Paper based sys.- paperless
Resulting in Focus on strategic issues * Transmission-assimilation-processing of
data* secured envt. to treasurer to work effortless n improve overall performance of
finance dept.
■ Integrated Treasuries: Centralized Model-Streamlined-Separate in-house
entity’ shared service center.’ Resulting in Managing liquidity, payment
processing, internal cost saving, effective cash transfers from surplus-deficit,
Hedging, Appropriate investment strategies developed in fin. markets.
■ Treasury outsourcing: Hiring a financial institution or consulting agency for
handling day-to-day treasury functions.
■ Straight through processing.(STP) Complete automation and
integration of trade and settlement cycle. Streamlined different standards and
interfaces used by diff. foreign exchange platforms, banks and software
providers.STP eliminates intervention and allows simultaneous view on multiple
bank prices, trade request, reduce trade cycle, enhance accuracy of settlement.
■ Electronic data interchange(EDI)
■ Electronic Invoice Presentment and Payment (EIPP) e-invoicing,
■ Electronic Bill Presentment and Payment (EBPP) e-billing

10. Gambling/ Trying to catch the momentumGambling/ Trying to catch the momentum