Synlog has declared its 6-month results for the period ended December 2007. The Net Profit for the period registered a huge growth of 57.87%, against the corresponding period.
FX processing and controls will be seen as models for other capital markets instruments while its volume grows from algorithmic trading.
The trend towards centralization of liquidity at the global level will accelerate in 2008. Companies in Asia will further centralize their liquidity operations and link these to their liquidity positions in Europe and North America setting up global cash pooling structures.
More integrated offerings of automation front to back will emerge first in FX and extend across asset classes from technology vendors as revenue margins from trading thin out and risk reduction grows even more important.
There are many global trends coming with online trading such as product from Citi and Saxo Bank - CitiFX Pro, an online foreign exchange (FX) trading platform which is planning to pool their capabilities and offer FX trading to individuals and smaller institutional traders. This will offer client access to FX trading capabilities with more than 150 currency crosses in a market with a daily turnover of more than US$3 trillion.
The FX market has seen and will continue to see remarkable changes. The buy-side is likely to become even more ambitious, capitalizing on innovations in e-trading, algorithms and a volatile market whereas the sell-side is witnessing more dynamic and sophisticated clients on their books.
The requirements for real-time position and risk information has been topical for a few years, but in a market characterized by decisions made in milliseconds by machines using complex equations, the need has become indisputably clear. This need will only intensify over the short-term as portfolios and positions have to be adjusted on an intra-minute basis. Finding the right approach to deal with these issues is central to their ability to succeed in such a competitive space.
The future promises even more advances in the speed of communication and range of functionality offered by treasury management systems. Much of this development is based on the use of the Internet as a broad communication medium, the Web browser as the universal client, and the seamless integration with other systems.
Many organisations will join the growing list of organizations using the Intranet to collect and disseminate information within company boundaries. This will be extended to the outside world using Extranets and to business partners through file private networks (VPN’s). Treasury applications will take advantage of these developments to provide information and transactional capabilities in a more complete, user friendly and timely fashion.
The ever changing role of the corporate treasurer, specifically their evolution into "Manager of Corporate Risk", increasing transaction volumes and complexity of transactions and information requirements, and continued globalisation of treasury operations will drive the development of treasury systems in future.
Vendors and solutions will continue their consolidation and "best of breed" solutions will evolve from the conglomeration of vendors and systems. Big names in software such as ORACLE, SAP and Microsoft will offer solutions or form partnerships with leading treasury system vendors.
The Internet and Electronic Commerce, and advances in the amount of bandwidth available on the public Internet, is probably the first thing that comes to mind when thinking about the future of software systems, due to the great impact that it promises to have on the way we do business. It is therefore not surprising that many vendors are already including browser-based functionality in their treasury systems.
This trend will continue to develop, with the first phases focussing on full service, Web based, cash management and corporate electronic banking. Inside the organisation the use of Intranets will expand from an information delivery mechanism to one where users across the organisation not only draw information, but also transact with treasury systems.
Broad-based automation of treasury business processes will continue, allowing treasury to cope with increased transaction volumes and freeing up personnel to focus on value-added activities, such as the provision of analysis and risk management services to the broader organisation.
Even more energy will be spent on the efforts to integrate treasury systems with the rest of the enterprise and the boundaries between competing standards and development platforms and operating system environments will continue to blur until they coexist and integrate seamlessly.
As the market for MMFs continues to grow at high rates in the US and Europe, it does seem to be a natural consequence that they will take hold in more emerging economies also, provided the infrastructure to support the market exists.
As systems integration becomes better, cash flow forecasting will become more accurate and reliable. It will be a natural by-product.
There will be more development of forecasting systems that can cope with companies which have multiple ERP systems.
A larger involvement of banks in supporting corporate cash forecasting - perhaps the development of more bank-based forecasting tools.
There will be a continued trend towards companies integrating their payment factories, eBilling processes or shared services centres with their cash forecasting to continue.
There will be increased take up of Internet applications for cash forecasting information collection.
US banking "Regulation Q" will drive demand for cash forecasting in America - as banks currently earn no interest on deposit accounts.
Corporate treasurers will need to ensure they have a well thought out and responsive cash management policy - something that HSBC's Knight covers, by setting out his five principles of global cash management. These are: 1) manage cashflows effectively; 2) forecast cashflows accurately; 3) tranche cashflows intelligently; 4) establish an appropriate investment policy, and; 5) implement effective investment management.
With regards to liquidity funds, European market has been increasing roughly 50% yearly.
With the volume of global payments continuing to grow, pricing for many services decreasing, and technological innovation remaining strong, it is imperative for finance professionals to stay on top of trends and developments. In doing so, corporations will be able to have best practices in place and update them on a regular basis.