Year in data 2015: Cash management

By:
Published on:

Crunching the numbers on cross selling.

Just how important is cash management as a way of cross selling other bank products to clients? The results of this year’s Euromoney Cash Management Survey – based on a poll of 23,000 corporates – painted a mixed picture of achievement and missed opportunities.

First, the good news. If you have a cash management mandate, there is almost an 80% chance that you will also carry out payments for your client, whether it is a corporate or financial institution.

Bankers often talk about the importance of relationships with treasury teams, given how much other business now flows from them. Among treasury products none is more symbiotic than foreign exchange. Again, the numbers are good – if you are a cash management provider, there is roughly a 70% chance that you will also carry out FX trades for that client.

Traditionally the most important link between bank and client is in the provision of credit. For all that cash management is touted as a core business, it is perhaps surprising that the two do not go more hand-in-hand: among corporate respondents, less than 50% combine a lending with a cash management relationship.

One-fifth of corporates give mandates to their cash managers for capital markets business and only around one in seven employ their cash management banks for risk management.

The survey showed that when it comes to cross selling, banks can still do a lot more to leverage their relationships.

chart-cash-management