Click here to read our treasury survey.
If you wish to discuss our findings or find out how you could develop your treasury function or the way you manage your financial risk, please contact us.
How are New Zealand organisations managing their funding risk?
Are you and your organisation doing enough to manage funding risk in today’s challenging environment? Is your organisation applying best practice or could you be doing more in how you approach your funding risk?
In our study – Oiling the wheels of the New Zealand economy: New Zealand Debt survey – you’ll find interesting insights and perspectives on the debt raising activities of organisations with approximately $50 million to $500 million of outstanding debt and how they are managing their funding risk.
We polled over 80 executives during the later part of 2012 from a wide range of publically listed companies, local authorities and private companies across New Zealand.
In doing this study we wanted to have a better understanding on how these organisations, often with limited treasury resource, make their decisions relating to debt management. We focused on entities that had significant choices around debt funding alternatives but also had enough debt to make it a meaningful issue to manage.
Inside the publication you will find out why organisations choose bank funding over debt capital markets or vice a versa; do they see benefit in a credit rating; how do they determine which banks to use; the types of covenants they are exposed to; what treasury policies they are subject to; and how have they traded off attributes such as the cost of debt relative to term, or relative to the freedom from covenants. We have broken the survey results down into four key themes – general funding issues, considerations relating to bank funding, considerations relating to debt capital markets funding, and treasury policy issues associated with debt and liquidity.
Our findings highlight that while not at the same intensity as they were during the height of the Global Financial Crisis (GFC), funding challenges and pressures remain significant, with the New Zealand financial system continuing to face a challenging international environment.
We hope the study provides you with some interesting ideas for you to consider and potentially adapt what you are doing to add further value for your business.
This publication is the second in a series of PwC New Zealand treasury surveys to be performed on a periodic basis, which we trust will provide you with valuable insights.
If you wish to discuss our findings or find out how you could develop your treasury function or the way you manage your financial risk, please contact a member of our Corporate Treasury Solutions team.