ge cash management strategy and swift macug’s cash management and swift macug’s introduction ge...

GE Cash Management Strategy and SWIFT MaCUG’s

GE TreasuryJanuary 24, 2006

GE Cash Management and SWIFT MaCUG’s

Introduction

GE Treasury and Cash Management

Major Operation Services Platforms

GE Businesses and Payment Requirements

GE Payment Systems – Past and Today

GE SWIFT Project - Strategy, Scope & Status

GE Payment Systems – Tomorrow

Wrap Up

2GE Cash Management & SWIFT

January 24, 2006

GE Treasury and Cash ManagementStrong Centralized TreasuryResponsible for:

Corporate PolicySelection of Banks and Banking ServicesAll Bank Account Administration (Business Delegation of Authority)Provide Funds Transfer and Banking SoftwareManage Cash Pools, Sweep Funds and Fund Disbursement AccountsExecute all FX, Debt and Derivatives Treasury Risk, Compliance, Legal, Corporate Reporting and SystemsSupport of Business Functions, Acquisitions and DivestituresFunding of GE and GE Businesses


January 24, 2006

Cash Pooling – Central PhilosophyAll Cash Belongs To CorporateWhere Possible, All Cash Should Be Part Of A Cash PoolCash Not In A Cash Pool Must Be Managed By Treasury

Over 100 Cash Pools in 27 Countries

Coming Soon …

BrazilCanadaMexicoUnited States

The AmericasAustria ItalyBelgium NorwayDenmark PortugalFinland SpainFrance SwedenGermany SwitzerlandHungary The NetherlandsIreland UKPan-Europe USD

EuropeAustraliaChina (RMB & USD) Hong KongSingaporeNew ZealandJapanThailand

Asia/Pacific

TurkeyUAE US Legal Entity (Cross-Border Europe)UK – (Global Consumer Finance)


January 24, 2006


January 24, 2006

Global LocationsTreasury Centers

Americas – Stamford, CTEurope – DelhiAsia – Tokyo

FX/DerivativesDublin

Regional OfficesMexico City (Mexico)Sao Paulo (Latin America)Shanghai (China)Delhi (India)Paris (European Funding)

Major Operation Services PlatformsTool Features Benefits

•Bank account database•On-line workflow •Business Treasury Bank

•Controllership•Compliance with OFAC, KYC•Productivity

•On-line cash management •Funds transfers•Balance reporting•Forecasts

•Standardization across GE•Cash positioning window to business activity

•Urgent & Non-Urgent Payments•Potential for FX, vanilla swap and collateral messaging

•Single, highly secure network•Somewhat standardized message formats

•Real-time and Batch OFAC / Compliance checking

•Compliance•28 US and other national / super-national compliance lists

•On-Line FX trade requests •FAS 133 wizard•Small ticket process

•Bid/Offer spread reduction•Settlement risk reduction•Interface to Bank Trading System


January 24, 2006

Major Operation Services PlatformsTool Features Benefits

•Intercompany sub ledger•Loan creation and maintenance• (Trema)

•Interest & fees calculation •Automated journal entries

•Bank fee processing•Analysis and allocation

•Fee recoveries > $1 MM annually•Handle International Bank Compensation

•FX trading system•Commodities trading

•Interfaces to TRS, GE Web Cash and FXALL

•Debt & Derivatives system •Centralization of Debt & Derivatives•Interfaces to GE Web Cash

•Web Portal used by counterparties to confirm rate resets, interest & swap payments

•GE Innovation – STP helps Middle Office cope with growing volumes (Alexander Hamilton Award)

BRM


January 24, 2006

GE Web Cash - Payment System

Banks

Banks &Brokers


January 24, 2006

GE Businesses and Payment Requirements

GE Industrial Business

Large Volume AP Payments

Some Wires

Large Volume FX Payments

GE Financial Services Large Volume Time Critical Wires

Direct Debits and Some ACH’s

NBC Universal Remote Locations

Speed of Implementation

GE Treasury Large Volume of Wires

Some Time Critical (Deals)

High Degree of Automation

General Global Reach to Support GE

Interface with Business Systems

Reliability / Speed / Controllership


January 24, 2006

GE Web Cash Metrics - TodayGE Banks and Accounts

Banks 200Accounts 17,000

Treasury Processing – GE Web CashBanks Reporting 133Accounts Reporting Daily 9,600Monthly Urgent Payments

Number of 78,000 / 330 Billion USDMonthly Non-Urgents Payments

Number of 40,000 / 4.5 Billion USDActive Business Units 300Active Business Users 2,500


January 24, 2006

GE Payment Systems - Past

2 Central Systems

Outdated Technology (Desktop without Central Database)

Met US and European Treasury Needs

Met US and 50% of European Businesses Requirements

Extremely High Maintenance / Proprietary Technologies

Operated at Capacity


January 24, 2006

GE Payment Systems - Today


January 24, 2006

GE Web Cash - Centralized Web Based System

Integrated Centralized Support Teams24 Hour Production Support - Stamford, New Delhi &

Tokyo24 Hour Technical Support - Mexico, Spain & India

Standardized Bank Connectivity (SWIFT)

Enhanced Functionality to Support GE Businesses

Greater Reliability and Increased Straight-Thru-Processing

Reduced Technical Support / Increased Value Added Support

100% Systems Redundancy / Regional Operational Disaster Recovery sites

Bank Connectivity - PastPrimary Technology - EDI Mapping Software & VANs

Outbound - PAYMUL, PAYORD, PAYEXT & 820Inbound – FINSTA, BANSTA, CONTRL, 821, 824, 997 & AUTACKEDI VAN’s & Leased Lines w/ Matched Transmission HardwareDirect Send to Banks and Via Conduit Bank

IssuesDifferent Standards Even for Same Message Types (Banks Customize)Lack of Bank Responses (Confirms & Rejects)Delays in Transmission / ProcessingSecurity / Authorization not Standardized or Non-ExistentSome Banks Manually Process Messages (Not STP)Lack of ConsistencyFragile High Maintenance Environment


January 24, 2006

Bank Connectivity – Legacy Systems


January 24, 2006

Harbinger EDI Platform

Ba

ISDN Line

SMTP Connection

Dedicated Lease Line

X 400 Van Link

BanksBusiness

Applications

TreasuryApplications

Banks

Dial Up

Business Severs

Web Browsers Banks

Internet

BanksWorkstations

Dial Up

GE SWIFT Project Strategy

Move Existing Bank Messaging to SWIFTAdd New Bank Capability in Parallel to Migrations Standardize SWIFTNet Fin messages for Urgent

Wires:MT101, MT103, MT900, MT910, MT942, MT199 &

MT195FileAct for Bulk PaymentsComplete Messaging from Banks:“Confirms” on Execution“Rejects” on Cancels & Return of FundsFocus on Bank STP (Straight Thru Processing)


January 24, 2006

GE SWIFT Project Scope

32 Banking Groups / 100 Banks (Urgents)20 banks identified for SWIFT FileAct (Non-Urgents)Add Direct Debits Expand Asia, Middle East, Eastern Europe and Latin

AmericaFX, Swap and Collateral Messaging with

Counterparties


January 24, 2006

GE SWIFT Project Status (January 15, 2006)

SWIFT Fin (Urgents / Wires) – 72,000 per Month30 Banks Live on SWIFTNet Fin6 Banks in SWIFTNet Fin User Acceptance

Testing 17 Banks in SWIFTNet Fin Development2 Banks Live on FileAct5 Banks in FileAct Development


January 24, 2006

SWIFT / Bank Connectivity

IntermediaryBank

2nd Tier Banks

Business Systems

1st Tier Banks


January 24, 2006

Two Connectivity Options1st Tier Banks – Large Volume Partner Banks

Urgents and/or Non-Urgents2nd Tier Banks – Low Volume Partner Banks and/or Banks without

CUGsUrgents only

GE Payment Systems - Future

Expand Banks on SWIFT CUG

Expand Direct Debits and Non-Urgent Payments Capabilities

Improve STP and Reduce Touch Points

Add Multi-Language Support

Add In-House Banking and Payment Factory

Add Smart Screens (Intelligent Payment Entry)


January 24, 2006

GE SWIFT CUG ISSUES

Not enough standardization with SWIFTNet Fin messagesBanks have to much latitude in usage of fields / tags and message types

No adoption to date of SWIFT / TWIST XML standard

Many banks have not accepted/implemented SWIFT CUG

Many more banks have not accepted/implemented FileAct

Some banks initially did a terrible job of implementation

Not many corporations can undertake this large initial implementation efforts


January 24, 2006

Other Hot Cash Management Topics

KYC (Know Your Customer) – Balance/Transaction Reporting must carry full remitting party informationApplication of Cash – Balance/Transaction Reporting must be able to carry large amounts of Payment DetailsIBC (International Bank Compensation) – Electronic Presentation of Bank InvoiceIn Europe IBANs and the Single European Payment Area (SEPA) initiativeThe TWIST/SWIFT XML Payment Standard


January 24, 2006

用語解説GE Cash Management Strategy and SWIFT MA-CUG’s

GE Treasury January 24, 2006

用語スライドページ

日本語解説

Cash Pool 4 通貨別又は複数通貨にまたがってグループ会社の決済預金口座残高の凸凹を調整し、仮想的又は特定の時点でバランスを移し替えて総計の残高に対して金利の計算をする銀行のサービス。グループ会社間の貸借になるため対象通貨・国によっては規制の対象になる場合もある。また、２国間の租税条約に関連し源泉税の問題が発生する場合もある。

OFAC 6 Office of Foreign Asset Controlの略。米国財務省の部門で、国家の安全保障を脅かす可能性のあるテロなどの活動に関し、米国内でその活動資金を凍結する権限を持つ。

KYC 6 Know Your Customerの略。BIS（国際決済銀行）が定めた「銀行の顧客確認」に関する基準。マネーロンダリング防止のほか、法的、評判リスクなども含めて、銀行の健全性の観点から重要な要素とされている。ひいては日本を含んだ先進国の市場慣行を定める会（日本では外為委員会）などでもKYCの重要性を強調している。

Wire 9 米国では、高額のValue Date（当日利用可能な資金の入金予定日）を守らなければならない送金のことを、主にWireと呼ぶ。

ACH 9 Automated Clearing Houseの略。クリアリングハウスで決済される小口大量送金のことを指す。Straight-Through-Processing

12 STP。Straight Through Processingの略。人手を介さず、（決済）取引をend-to-endでコンピューター処理により自動化することにより、安全性と効率を高めること。

Redundancy 12 直訳すれば冗長性だが、システムの対障害性を高めるために、一つの系統に頼らない設計を施した構築デザイン。

EDI 13 Electronic Data Interchangeの略。国連のUN/EDIFACTにて各業務に特化したスタンダード（PAYMULなど）が定められている。


January 24, 2006

X.400 14 国際電気通信連合の電気通信標準化部門（ITU-T）の定めるメッセージハンドリングシステムの規定集。現実的には、現代のe-mailの前身ともいえる。

SMTP 14 Simple Mail Transfer Protocolの略。いわゆるインターネット・メールのデータの送信・転送の手順。

FileAct 15 SWIFTが提供するSWIFTNet環境でのファイル転送の仕組み。安全性確保のためFTPなどの通常の手順とは根本的に異なっている。

Bulk Payment

15 給料・総合振込・口座引落しなど、小口・大量の送金を言う。（ACHペイメントとほぼ同じ意味）

SWIFT CUG 19 SWIFTが提供する、電子的コミュニケーションにかかわるClosed User Groupという名の論理的な環境。一般に事業法人はSWIFTメンバーが管理する（Member Administered）CUGに間接参加する形態をとる。

TWIST 20 Treasury Workstation Integration Standard Teamの略。ロンドンベースの標準化団体であり、財務取引にかかわるワークフローの分析や決済の標準化を目指す団体。 SWIFTの標準化の動きと連携をとっている。

IBC 21 International Bank Compensation. GE, International Paper Co, Lucent Technology, Pfizer, UPSなど北米の多国籍企業が、内外の銀行に対して、決済手数料、金利計算などの計算書を電子的な手段で出すことを求めているイニシアティブ。 FormatとしてANSI822を推奨している。手数料管理の効率化を目指している。米銀では約９０行がANSI822準拠の計算書を発行。

IBAN 21 International Bank Account Number ECBS(European Committee for banking standards)が定めた欧州域内のEUR決済のための送金に必須な番号。 IBANにより、銀行、支店、口座番号が一意に決まる。

SEPA 21 Single European Payment Area EUが進める、EURO決済圏の更なる統合の対象地域


January 24, 2006

ge cash management strategy and swift macug’s cash management and swift macug’s introduction ge...

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