Key Takeaways

In-depth insight into current and future liquidity

Simplified a complex investment portfolio into one robust platform

Gained control of fraud risks with clear segregation of office duties

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First Sentier Investors is a global asset management group offering high- quality, long-term investment services to clients. The company is a part of the Mitsubishi UFJ Trust and Banking Corporation, which is a wholly owned subsidiary of Mitsubishi UFJ Financial Group, Inc. As a standalone global investment management business, First Sentier Investors manages more than AU$228bn* of assets on behalf of institutional investors, pension funds, wholesale distributors and platforms, financial advisers and their clients.

When First Sentier Investors was acquired by Mitsubishi UFJ Financial Group (MUFG), it went from being part of one of the largest banks in Australia to a standalone global investment management business. The treasury program used when part of the bank system was very powerful and excelled at current mark-to-market valuations but did not have the functionality to perform more comprehensive, in-depth FX, risk and liquidity forecasting, and management analysis. The Australian Infrastructure Investments team of First Sentier Investors required a system more aligned to a corporate treasury desk with more robust analysis tools to monitor risk exposures. Better compliance and reporting functionality were also needed for First Sentier Investors to meet fiduciary obligations to its investors and regulators.

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Challenges

To improve the efficiency of the treasury function through automation of key activities and deliver a comprehensive reporting solution for treasury, risk and regulatory compliance. The Treasury and Finance teams are responsible for operations which span the management of daily liquidity as well as risk in the banking book arising from interest rate volatility. The combined use of spreadsheets and manual processes to manage the entire treasury function was proving challenging and ineffectual, leading Defence Bank to seek and implement a solution that would transform their operations and support the strategic direction of the business. Defence Bank also wanted to improve their strategic management of interest rate risk. Treasury wanted to leverage new technologies to support their strategic agenda and had very clear goals which supported their broader business objectives. The implementation of GTreasury brought significant changes in several key areas.

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Solution

First Sentier Investors chose GTreasury’s Financial Instruments, Risk Management and Hedge Accounting solutions to revolutionize its treasury management operations. GTreasury’s single database design allows the Infrastructure Investments team to visualize, manage and report on the entire investment portfolio from deal initiation through settlement using one integrated system.

Other key benefits for First Sentier Investors are GTreasury’s built-in security across all functions and SaaS-based access, which became especially valuable during the COVID-19 pandemic. GTreasury’s robust rules engine allowed First Sentier Investors to set up clearly defined user roles and responsibilities to segregate duties and minimize risk. With user roles in place, the company was able to outsource back and middle-office functions to a third-party partner and free up the internal team for more in-depth analysis and strategic planning. Chan explains, “I can review the deals entered into the system by our back- office partner, but I can’t actually amend them. On their side, one person is responsible for trade capture, then someone else is responsible for confirmation, which is a middle-office role. The system works very, very seamlessly once you set it up properly.”

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“We are a corporate treasury desk with the scrutiny of a financial institution. We must monitor and manage our investments, but also perform our fiduciary duty to our investors, as well as meet our regulatory obligations and reporting requirements to maintain compliance.”

Siu Chan

Senior Treasury Manager

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