As if the dramatic changes to the banking landscape following the financial crisis didn’t already cause enough concern for treasurers – the scandal over Libor manipulation by major banks has been just another headache that they didn’t need. The scandal, which claimed the scalp of Barclays’ Bob Diamond (once dubbed the “unacceptable face of banking” by Labour politician Lord Mandelson), has never been far from the headlines during the second half of this year.
With Libor appearing thoroughly discredited, politicians and regulators in Europe and the US started to ask awkward questions about the future of the benchmark lending rate. Should it stay or should it go? And if it stayed, how should it be reformed and which body should regulate it? Fortunately, the future of Libor became a whole lot clearer at the end of September, when Financial Services Authority (FSA) managing director Martin Wheatley published his 10-point plan for Libor reform, proposing new and robust regulation, with Libor being regulated by the FSA, and its successor, the Financial Conduct Authority, going forward. The proposals were roundly applauded, but, inevitably, some unanswered questions still remain. We find out what Libor reform means for treasurers in our cover feature, starting on page 18.
This month, we also meet David Mallac, the man who must hold one of treasury’s dream jobs as the group treasurer of brewer SABMiller. He shares his experience of high-profile acquisitions, emerging markets and managing commodity and FX risk, on page 24.
In September, the IASB published its eagerly anticipated staff draft on the general hedge accounting section of IFRS 9, Financial Instruments. We take an in-depth look at the implications, on page 28.
For many companies today, their pension scheme could be their biggest subsidiary or even dwarf the size of the main business. It’s no wonder then that pensions are an ever-present concern for many treasurers. We find out what they can do to protect their companies from any potential shocks that may arise, on page 32.
We also continue our regular series of technology articles, with a look at how treasurers an use software to effectively manage risk, on page 40.
As usual, we feature in this month’s issue the latest technical news, training and events listings, career advice and guidance from an examiner to support students who are sitting the ACT exams.
Please get in touch to share your thoughts and suggestions: we will be particularly interested to hear your views on Libor reform.