Five Ways Associated Bank is Helping Clients with International Money Exchanges

Clients are relying on bank expertise perhaps more than ever. One way banks can help clients is with understanding exchange rates and making smart decisions around which currency – U.S. dollars or another currency – is most appropriate to use in a given business transaction.

"We absolutely have the ability to move money internationally," Garcia said. "I think our bank has a solid base – as do many others, of expertise in terms of 'is it better to send U.S. dollars or the local currency?' And so being able to guide clients as to what is better for their individual transaction or their business as a whole is significant and can mean significant amounts of money to the sending institution, or the receiving institution, so wise clients will seek guidance on that front because the dollar differences can be considerable."
 

The Treasury Management team are on hand to determine clients' end goals. Knowing what a client is trying to achieve is necessary to shape the plan.

"What are their objectives, what are they trying to achieve? Are they a sender of money internationally? Are they a receiver? And those can really vary, depending on whom they're transacting business with, what they're trying to achieve," Garcia said. "Being able to provide them with guidance on that and how the money is moved, it can have considerable cost implications."
 

The Treasury Management team aims to help their clients by being a resource when it comes to cash flow management.

"Knowing your trading partners – who do you pay, who do you receive money from, obviously having a confidence on the payment side that you're going to get paid in a timely fashion (is important)," Garcia said. "Most commercial companies, especially in a healthy economic environment can predict very tightly how they're going to receive money coming in."

"Then you have the outflow, obviously you want to slow that to the best of your ability and/or take advantage of any trade terms that could be in your benefit," Garcia said. "When we've been in such a low, low rate environment, it's been less important. It's always important, but it's been less important. But now that rates are rising – especially if you're a net borrower – that cost of money today is higher today than it was a year ago. Ensuring that you have efficient means within your company to move money out and have the efficiencies coming in is really important."
 

Cash flow is not always the priority it should be – especially for smaller businesses where resources for monitoring it can be slim. That, too, is where Garcia's team steps in to offer assistance.

"If you're a sole proprietor and you're out trying to sell your company or you're performing duties in the course of a day, your cash flow is (likely) not top of mind," Garcia said. "It's getting your business going, it's handling your customer requests. Many of those type(s) of clients, they do their banking at nighttime or the weekend. And so they may be caught in a pinch at certain points in time …," Garcia said.
 

Monitoring patterns of cash flow is important. Based on that monitoring, companies can begin to think longer term. Garcia and his team help clients identify patterns and forecast into the future.

"Most companies have a pretty predictable trend," Garcia said. "And smart companies, especially companies that have professional management, a treasurer, a cash manager and such, can pretty well predict over the months what the flows in and out (will be). Obviously you know when you're going to pay people, so that's very predictable, especially the employees, that's very predictable, so you know the outflows probably better than the inflows. But over time you get to know your trading partners and managing that and managing your investments according with that, or borrowing if you need to (in order) to hit the low periods. Companies are pretty adept at that."