In sales activities, Treasury and Capital Market increases its transaction volume through electronic channels, the branch network, addition of new customers, and increasing client awareness of hedging transaction options in accordance with the spirit of risk management as governed under Bank Indonesia regulations.
Treasury and Capital Market also has some of main activities that include the development of new structured products, expansion of the customer base of both corporate and retail customers, and cooperation with small-scale banks as counterparties in forex, bonds and derivative transactions.
PERFORMANCE IN 2017
Implementing strategies and policies throughout 2017 brought positive impacts to the fixed income portfolio of CIMB Niaga’s Treasury and Capital Market, consisting of government and corporate bonds growing to Rp32.9 trillion, compared with Rp24.4 trillion in 2016.
PRODUCT INFORMATION
In 2017, CIMB Niaga’s Treasury and Capital Market offered a range of products that create added value to customers. These products are as follows:
1. Market Link Deposit (MLD) is a structured product that combines derivative and deposit instruments.
MLD offers yield enhancement and a 100%
protection warranty on the principal amount. This product is also flexible and liquid (CIMB Niaga provides daily quotations on the disbursement rate). By its underlying assets, there are two types of MLD, namely interest-rate based and foreign currency-based MLD.
2. Swap Depo is a structured product that offers yield enhancement and a 100% protection warranty on the principal amount. This product combines deposits with FX swap derivative instruments.
3. Strike Currency is a structured product for derivative transactions using currency options based on strike prices.
4. Government Bonds and Corporate Bonds. CIMB Niaga provides daily price quotations to customers to assist in selling or purchasing bonds.
In addition, Treasury and Capital Market also offer other products such as buying or selling foreign currencies through Today, Tom and Spot, as well as the
“Call Spread” hedging product, which give customers alternative hedging products other than Forward Plain Vanilla transactions. A Call Spread transaction has its own advantages and disadvantages if compared to Forward transactions, one of which being lower expenses.
SERVICES AND NETWORKS
Treasury and Capital Market operates a network of service locations in several major Indonesian cities, including Jakarta, Medan, Bandung, Semarang, Solo, Surabaya, Denpasar and Balikpapan, personally meeting the needs of customers for treasury products.
In addition, electronic transaction services for foreign exchange and securities products are also available at most CIMB Niaga branches in Indonesia. These service points provide real time price quotations with a faster distribution process. Other than at branch offices, customers can also access online and real time foreign exchange services via BizChannel and CIMB Clicks, anytime and anywhere.
UTILIZATION OF INFORMATION TECHNOLOGY As one of the pioneers of digital banking in Indonesia, CIMB Niaga initiates various digital banking services that have driven an increase in foreign exchange transaction volumes through electronic media. In addition, continuous improvements in these products and an increase in the use of electronic media continue to reduce operational risks and improve the customer experience by facilitating various types of banking transactions through electronic media.
Treasury and Capital Market also uses information technology to get local and overseas information required for determining trading strategies. In addition, information technology is also utilized to inform Treasury and Capital Market products and pricing to all CIMB Niaga branches on a real time basis, to provide an even more competitive pricing option.
TREASURY AND CAPITAL MARKET
AWARDS
In 2017, CIMB Niaga achieved some awards in recognition of excellent performance, as following:
1. AsiaRisk Award 2017, House of the Year, Indonesia.
2. Triple A Investment Awards 2017 - Best Derivatives House of the Year, Indonesia.
3. Triple A Investment Awards 2017 - Best Structured Products House, Indonesia.
PLANS FOR 2018
The Treasury and Capital Market business segment will continue to strive to meet the demands and needs of both corporate and retail customers and will make CIMB Niaga a one-stop banking solution for Treasury and Capital Markets. In 2018, Treasury and Capital Market have established plans to improve performance by adding instruments and channels for retail bond services, as well as the development of digital-based forex transaction services and automation, in line with the growth of FinTech based companies that require such products and services.
VINCENT LIM
CEO FKS Food and Agri
The cooperation between FKS Food and Agri and CIMB Niaga started in 2001, when PT FKS became a customer of CIMB Niaga.
The cooperation has continued successfully and developed well up to the present time, where FKS Multi Agro has become the leading company in its field in Indonesia.
FKS Food and Agri uses various banking services, such as Foreign Exchange Transactions to support export-import activities, as well as hedging, Lending Facilities, Cash Management through the Biz Channel, Trade Finance, and other services. The quality of banking services provided by CIMB Niaga was adequate to continuously support the performance of our company. It is our hope to remain in a close relationship to continue supporting our company in the coming years. We are big and growing together with CIMB Niaga.