(14 March 2025 – Taiwan) Buffeted by global headwinds, Treasury Today reports that Taiwan’s treasurers have had to cope with currency and interest rate volatility by strengthening their risk management frameworks, as well as leaning on their banking partners for greater support.
In the past year, interest rate volatility has come out as a top risk for corporate treasurers in Taiwan, according to East & Partners research, well ahead of tech infrastructure upgrades, intermediary risk, trapped liquidity, payment execution risk, and fraud and money laundering.
Many banks are trying to help their clients address these pressing operational issues, with varying degrees of success. That is being reflected in how treasurers are behaving in terms of increasing intent to switch provider and level of panel banking.
“While inflation is steadily coming under control, interest expense has increased significantly in the past year, in many instances doubling or more, with few Taiwanese corporates reporting no change in interest expense,” commented East & Partners Global Head of Markets Analysis, Martin Smith.
“FX switched to an active responsibility for treasurers, who had varying degrees of success in managing it. There are several different key performance indicators and performance metrics that we track for the banks that are flashing red on numerous instances, as many incumbent banks are finding it more difficult to retain business with their largest, most valuable clients” Smith adds.
Customer expectations are rising rapidly, evidenced by increasing customer switching/churn intent each year, according to East & Partners research. One in four APAC corporates plan to switch cash and payments provider in the next six months, with some banks facing churn rates as high as four in ten primary customers actively considering a change in their service provider in the next six months.
The functionality that would most compel a corporate treasurer to switch their primary banking relationship is faster onboarding (24%), efficient anti-money laundering (AML)/know your customer (KYC) processes (19%) and enhanced transaction visibility (16%).
Proactivity, positioning the client front and centre, and specific industry expertise are critical for a best-of-breed corporate-banking relationship, according to Smith.
“Despite the push towards digitisation, automation and enhanced application programming interface (API) functionality, old fashioned relationship management excellence is increasingly winning the hearts and minds of Asia’s chief financial officers (CFOs) and treasurers,” he says.
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