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Industry roundup: 14 January

AIB selects Planixs’ real-time liquidity management software to enhance treasury operations

Planixs, a provider of real-time, intraday cash, collateral and liquidity management solutions, has announced that it has been selected by Allied Irish Banks (AIB) to enhance their liquidity management processes and treasury operations through Planixs’ Realiti software suite.

AIB monitors and funds numerous accounts in all the major global currencies on a daily basis, which equates to a significant amount of transactions. The Irish bank was looking for a real-time liquidity solution that would allow them to automate their current processes and provide them with insight of all accounts and transactions, and their real-time intraday liquidity position. The firm also wanted the ability to report in real-time - allowing them to ensure regulatory compliance.

After a comprehensive market selection, AIB selected Planixs’ Intraday Liquidity Management; Funding & Forecasting; Stress Testing, Intraday Reconciliation and Regulatory Reporting modules to improve its processes, with the potential to add further modules in the future to increase and enhance functionality.

The modules selected are designed to allow AIB to gain real-time insight into liquidity positions; detailed analytics and forecasts of end-of-day projections for all accounts; real-time reconciliation and auto-matching capabilities and to meet regulatory reporting requirements.


Pandemic-led structural shifts accelerate long-term credit risks

The coronavirus pandemic has accelerated and amplified structural shifts in several sectors that that may cause some permanent weakening of their operating environments that would add to long-term downside credit pressures, according to a Fitch Ratings special report, 'Pulled Forward: Pandemic-led Structural Shifts Accelerate Long-Term Credit Risks'. 

Heavily impacted sectors include discretionary retail, airlines, lodging, leisure, oil and gas and parts of commercial real estate, all of which face a prolonged recovery and need to adapt to structural changes precipitated by the pandemic such as the accelerated shift to online activities and rising ESG-related considerations. 

The challenges facing corporate sectors will cascade through other parts of the credit universe, the Fitch report noted. Public finance and infrastructure could experience disruptions to revenues and the provision of services. Huge stimulus packages will weaken certain sovereigns' balance sheets, limiting their ability to navigate the post-coronavirus period. This could add to asset quality and profitability pressures on banks, notwithstanding that they entered the crisis in a position of relative strength.

Given the structural nature of these changes, adaptability will be a key factor for future credit differentiation, especially when policy support lapses. The recovery's resilience will also be key, with major Asian economies appearing better placed for a stronger recovery, supporting issuers more broadly in the region. 


HSBC, Mirova and Natixis become founding partners of Natural Capital Investment Alliance

HSBC Pollination Climate Asset Management, Lombard Odier and Mirova, an affiliate of Natixis Investment Managers, are the three founding partners of the Natural Capital Investment Alliance (The Alliance), established by His Royal Highness The Prince of Wales under his Sustainable Markets Initiative. The Alliance aims to accelerate the development of natural capital as an investment theme and to engage the US$120 trillion investment management industry and mobilise this private capital efficiently and effectively for Natural Capital opportunities.

As the world continues to tackle the twin climate and biodiversity crises, there is growing interest in investing in harnessing and preserving natural capital as a solution to reducing emissions, restoring biodiversity, and boosting sustainable economic growth and job creation. However, despite the fact that half of global GDP depends on natural capital, there are currently only a limited number of initiatives to promote nature as an investment opportunity. To seize the scale of this opportunity, a finance-led approach is needed to integrate natural capital as an investment theme across different asset classes, as well as improved investor-centric descriptions of Natural Capital investment opportunities. That is the purpose of this newly formed Alliance.

The three founding partners - HSBC Pollination Climate Asset Management, Lombard Odier and Mirova - are described as established pioneers in natural capital investing that have launched or developed specific vehicles or strategies for investments in natural capital.

HSBC Pollination Climate Asset Management, a joint venture between HSBC Global Asset Management and specialist climate change advisory and investment firm Pollination, is establishing a series of Natural Capital funds, directly investing in the preservation, protection and enhancement of nature. Lombard Odier launched a first-of-its-kind global equities investment strategy for natural capital last year, directly inspired by His Royal Highness the Prince of Wales and developed in partnership with the Circular Bioeconomy Alliance, established under his Sustainable Markets Initiative. Mirova has established a natural capital platform proposing strategies in the field of land restoration, blue economy and forest protection with more than 30 experts.

The Alliance aims to attract members from the finance community to create scale, and synergistic bridges between mainstream asset owners and asset managers, underpinned by the following goals:

  • To mobilise US$10bn towards natural capital themes across asset classes by 2022.
  • To serve as a central hub for global corporations and financial institutions seeking to scale-up their investments into natural capital, in support of biodiversity restoration, including through carbon offsets.
  • To share investment knowledge and expertise to help mainstream the natural capital investment theme and demonstrate scalability of appropriate vehicles and the multiple opportunities across asset classes.

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