Integrated Treasury in banking refers to the management of a bank’s financial assets and liabilities through an integrated system. It involves the integration of various treasury functions, such as cash management, investment management, risk management and financial reporting into a single platform.
An integrated treasury system in banking provides real time information about a bank’s cash position, liquidity and capital adequacy. It helps treasury managers make informed decisions about managing the bank’s cash flows, investments and risks. The system allows treasury managers to monitor and manage their cash balances, investment portfolios and debt levels, as well as analyze market trends and perform risk assessments.
In banking set-up, Integrated Treasury refers to
integration of domestic and foreign exchange operations. A comprehensive
strategy for funding the balance sheet and allocating capital across domestic,
international and foreign exchange markets is known as integrated treasury.
With this strategy the bank is able to maximize asset-liability management and
take advantage of arbitrage opportunities.
The system may also offer modules for foreign exchange trading, trade finance and banking relationships management. Additionally, the system can integrate with other enterprises’ systems such as accounting and ERP systems, to provide a comprehensive view of the bank’s financial operations.
The integration of the forex dealing, and domestic treasury has helped the bank to overcome this unwanted situation as they consolidate outflow and inflow of money both form domestic and foreign exchange operations. In the integrated scenario, banks no longer distinguish between BDT cash flows and foreign currency cash flows.
Overall, an integrated treasury system in banking
provides banks with greater visibility and control over their financial operations,
enabling them to optimize their cash management and investment strategies while
minimizing risks. It helps banks to maintain financial stability, comply with
regulatory requirements and enhance their profitability.