Treasurers already hit hard by Basel III - report

According to EuroFinance Basel III Index, a further 48% expect them to deteriorate in future. The index is designed to provide a measure of the impact of the Basel III bank regulations on the products and services corporate treasurers rely on the most. Every six months the index will be updated, monitoring the ongoing shifts in the price and availability of core treasury products.

The first iteration of the EuroFinance Basel III Index represents the responses of 227 treasury executives to a series of questions about the pricing and availability of core risk management, credit and cash management products and services. The answers to these questions are assigned weightings that reflect the relative importance of each product/service and the scores are combined to create a measure of how many more treasuries are being impacted and in what areas.

Surprisingly, even though many of the banks’ Basel III deadlines are some way off, the index shows that a significant number of treasurers are already experiencing significant changes to their operating environment: from a base level of 100 on November 29, 2014, the initial index calculation is 123 on May 29, 2015.

The report also reveals that 24% of companies who use term bank credit have seen a price increase; 40% of companies have had a bank withdraw services from a country in which they operate; 22% of companies with a pooling arrangement have had the service changed or withdrawn; 23% of companies have had a bank refuse a deposit. Moreover, 45% of companies with revenues above USD 10 billion have had a deposit refused versus 14% of companies with revenues below USD 1 billion.

EuroFinance is a global provider of conferences, training and research on cash management, treasury and risk. EuroFinance is an Economist Group business.