Brexit brake. Western Europe expects a 2.7 percent increase in insolvencies for 2019 – in line with a rise across the US and the world. This is noted by Aaron Rutstein of trade credit insurance company Atradius, in a Treasury & Risk article. “Slowing economic growth and lower global trade are two contributing factors, but widespread uncertainty surrounding Brexit is the major culprit there,” he comments.
Stockpiling ties cash. Speaking of Brexit, CTM File carries an article on how the political uncertainty is weighing on businesses’ liquidity. ”Now that there is a third deadline for the UK’s departure from the EU, many businesses will have to stockpile once again to prepare for Brexit. While stockpiling may help businesses through the UK’s transition out of the EU, it puts a strain on their supply chain and cash flow,” writes Paul Christensen, founder of British payment solutions company Previse.
Digital payment speed-up. Cross-border payments are continuously a hot area. CTM File notes Mesh and Visa collaborating on a ”supplier first” virtual commercial card service for B2B payments, as well as a successful blockchain-enabled live end-to-end trade finance transaction by Trade and Development Bank, in Africa. All while in the Nordics, a columnist with Swedish paper Svenska Dagbladet argues (in Swedish) for rapid implementation of Riksbanken’s plans for a digital version of the country’s currency.
How to say bye to LIBOR. Treasury & Risk sees the demise of LIBOR as a force that will up-end securities, noting that the derivatives exchange giant CME is proposing a methodology for converting eurodollar futures and options to the SOFR benchmark. The news site also observes how the world’s biggest banks are now pushing policymakers to urgently deliver a Brexit fix, to make sure that European traders can keep their access to London derivatives clearinghouses – avoiding the rupturing of $78 trillion in contracts.
Latest events – the broad take. On the back of Treasury Today’s 20th anniversary issue, we are happy to let this round-up comprise the 20 year perspective. ”From the introduction of the euro and the financial crisis of 2007/8, to the implications of Brexit and the ongoing tensions between the US and China, treasurers have continually had to adapt, learn and grow. They have also had to utilise skills today that they never thought they’d need 20 years ago,” writes the magazine.