A survey by Greenwich Associates has concluded that cash and liquidity management are still top priorities for corporate treasury. However, switching bank is a challenge for 20 per cent.

The survey of more than 2,500 global treasury and finance professionals identified two main factors behind the focus on the basic task of maintaining liquidity and managing cash.

Firstly, as several central banks push interest rates to negative levels, the question of how to allocate cash reserves has become a critical issue for European companies, say the researchers at Greenwich Associates.

Secondly, there has been disruption in the corporate cash management business, with RBS pulling out of transaction services outside of the UK, as well as some withdrawal of services by other leading banks. This has meant many corporates have been forced to look elsewhere for the cash management services they need. Twenty per cent of European corporate treasury departments name “switching cash management providers” as the top challenge they face in 2016.

The top challenges faced by treasury departments in Western Europe are as follows:

European Top-Tier Large Corporate Banking Market Penetration

The survey also ranked European corporate banking providers. BNP Paribas ranked in first place, based on 635 respondents from top-tier companies. The top six were as follows: 

Bank	Market penetration
BNP Paribas	60%
HSBC	51%
Deutsche Bank	46%
Citi	36%
UniCredit	35%
RBS	34%

Greenwich Associates consultant Dr. Tobias Miarka said: “Banks that can help large companies successfully navigate unprecedented challenges like negative interest rates and the need to unexpectedly switch cash management providers are differentiating themselves from competitors and winning new clients. But in some ways this represents a new challenge for banks, since it’s difficult to make money while providing this level of service in a low-margin business like cash and liquidity management.”

The survey, carried out from August to November 2015, is based on 2,585 interviews with financial officers (e.g., CFOs, finance directors and treasurers) at corporations and financial institutions with sales in excess of €500 million, including 1,122 with sales of at least €2 billion.