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CLSA picks HSBC to provide liquidity-management services

HSBC’S global payments and cash-management unit was appointed to provide liquidity-management services to CLSA Asia-Pacific Markets, it was learned on Monday.

One of the largest and most highly rated independent equity brokers and financial-services groups in Asia, CLSA operates a number of entities across different markets in the region, with a central borrowing entity located at its global headquarters in Hong Kong. Cash management, however, was left to individual entities, resulting in some operating with short positions requiring group funding and others running positive cash positions.

HSBC’s appointment was the result of CLSA’s efforts to bridge the gap between their debit and credit positions across their businesses, which would enable it to reduce borrowing costs significantly.

“When looking for a banking partner to help us manage our liquidity across our business, it was clear to me that some banks had much more expertise than others. I quickly identified HSBC as the strongest regional player in cash management, and they were able to set up innovative liquidity solutions for us, while their consultative approach helped us understand various local regulations across the region,” said Brendan McGraw, CLSA group treasurer. “With HSBC’s solutions, I am confident that our cash management will run more efficiently and effectively,” he added.

The regional structure implemented for CLSA across nine Asian markets is based on the bank’s global liquidity solutions (GLS) platform, dedicated to advanced liquidity management services.

The regional structure comprises a number of multi-currency notional pools to consolidate and offset mismatching positions across CLSA’s business entities, combined with an interest-enhancement cross-border virtual pooling arrangement to optimize the return on their other operational balances.

“The appointment of HSBC to provide liquidity management services to CLSA underlines the solutions-oriented nature of our global banking coverage model. We have been engaging with CLSA across multiple product initiatives, a number of which required the delivery of bespoke solutions,” said Robin Phillips, HSBC’s head of global banking and markets in the Asia Pacific.

“The implementation of this set of liquidity solutions is another positive step in the growing relationship between the two organizations,” he added.

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