Treasury Management Roles

Despite some short-term relief from month-end rebalancing, we believe that government bond yields face upward pressure over the medium term from a supply/demand perspective. There are two duration shifts that present a headwind for government bonds over the medium term. The first duration shift has been taking place in demand and has to do with the retail impulse into bonds. The YTD pace in bond funds is tracking pace of around $450bn-$500bn, a sharp decline from the $1.36tr seen in 2024. The picture looks even more problematic for bond demand if one takes into account the duration impulse. Not only have bond fund inflows slowed sharply this year relative to 2024 but these inflows have shifted away from longer duration government or corporate bond funds towards short duration funds. In other words, there has been an even bigger decline in bond fund demand in duration terms. The second duration shift has been taking place in supply. While the duration impulse of corporate bond issuance has been flattening out as corporates reduced sharply the maturity of their issuance, the duration impulse of government bond issuance continues to rise widening its gap with corporate bond issuance. This is shown in the chart below which depicts the notional amounts of USD corporate bonds in 10y-equivalent terms along with the equivalent metric for the Treasury excluding Fed holdings. In other words, much of the duration supply has been stemming from government bonds rather than corporate bonds.

Highly-rated sovereign #bonds with short maturities face the lowest demand elasticities from #investment funds, suggesting their role as safe assets. •US Treasuries appear to act as a global safe asset, as bonds issued by most regions other than the euro area are significantly affected by portfolio rebalancing towards US Treasuries following a shock to US T-bill returns. •German Bunds exhibit characteristics of a regional safe asset, with substitution patterns primarily within a narrow set of euro area safe government bonds. The Bank for International Settlements – BIS report analyzes a detailed dataset of global bond holdings by #mutualfunds in the US and euro area to estimate demand elasticities for various bonds. The study uncovers that US Treasuries act as a global safe asset, with their return changes prompting broad adjustments across risky and emerging market bonds, whereas German Bunds function more regionally, primarily influencing euro area safe government bonds. These findings highlight segmentation in international bond markets and have implications for monetary policy transmission, particularly during times of financial stress.

Struggling with cash flow despite steady revenue? Read this. Most businesses focus on revenue growth, but forget that timing matters more than total numbers. Your debt structure might be strangling your operations. During my years restructuring finances for MSMEs, I've seen countless profitable businesses gasping for air simply because their loan repayments peaked when their cash reserves ebbed. Remember when I helped that manufacturing client switch from monthly fixed payments to a seasonal repayment schedule? Their stress vanished overnight. Their revenue always spiked in Q4, yet their heaviest loan payments fell in Q2. We realigned their amortization schedule to match their natural business cycle. Smart debt structuring considers your unique operational rhythm. Consider bullet loans that allow interest-only payments until you can handle the principal. Explore graduated payment structures that start small and grow with your business. Investigate seasonal amortization that mirrors your cash flow patterns. Your business deserves a repayment schedule that respects its natural ebb and flow. The right structure preserves working capital during lean periods while capitalizing on abundance during peak seasons. Think beyond interest rates. The structure of how and when you repay matters just as much. After restructuring debt for hundreds of businesses, I can tell you with certainty: cash flow preservation through thoughtful amortization scheduling might be the most underutilized financial strategy. What financial structure is holding your business back today? Share your challenge below, and perhaps we can uncover a solution together. #CashFlowManagement #AmortizationSchedule #FinancialPlanning #BusinessFinance

Please STOP checking your bank balance and calling it cash flow management... it's not! I see far too many business owners doing this and living in permanent financial anxiety because of it. Your bank balance tells you where you've been. It tells you nothing about what's coming. Do this instead: - Know your cash position every single day - Know exactly who owes you money and chase it without apology - Agree payment terms before any work starts - not after - Invoice immediately at every milestone, not when you get round to it - Build a simple rolling weekly cash flow forecast That last one is the big one. A rolling forecast shows you what's coming in and what's going out, weeks ahead of when it hits. Which means you see the problem before it becomes a crisis. Which means you can do something about it. Which means you sleep at night. The main reason most business owners lie awake worrying about cash isn't because the business is failing. It's because they can't see far enough ahead to know. Visibility fixes that. Not complexity. Not a fancy accounting system. Just a simple weekly habit of looking forward, not back.

💸 How I’d Manage a $3M Seed Round I’ve raised over $50M+ in seed capital as a founder across my companies, but I’ll be honest, I didn’t really learn cash management until SVB crashed in 2023. That Friday, I was panicking. I had payroll due in days and was on the phone with every banker I knew trying to move funds out before things froze. That moment burned one lesson into me: as a founder, your cash strategy is your survival strategy. When you raise your first real round, it’s easy to focus on hiring, shipping, and runway math and forget that managing your cash is now a full-time job. Here’s how I think about startup treasury setup once that wire hits your account with four buckets: Operating, Reserve, Yield, and Contingency. 1️⃣ Operating: Keep 6–9 months of burn liquid. Use a modern bank like Mercury or Rho with sub-accounts for payroll, taxes, and payables. Automate categorization and approvals. 2️⃣ Reserve & Yield: Move the rest into yield-generating, safe instruments: FDIC-insured sweep accounts, short-term T-bills via Meow/Vesto/Arc, or government-only money-market funds. You can earn 4–5 % while staying fully insured or backed by Treasuries. 3️⃣ Credit & Liquidity: Even if you don’t need it, set up lines early. Ramp, Brex, or Mercury IO for corporate cards, and a small LOC with your bank after 6 months of deposits. 4️⃣ Contingency: Always have a backup bank. If your primary is digital, your secondary should be a traditional one (think Chase or BofA). Keep at least one month of burn there in case wires freeze or systems glitch. A solid setup like this can extend your runway by months and keep 100 % of your deposits insured. I broke this down (with a model and a 1-page cash management policy template) in a doc you can use with your board or CFO. 👉 Comment “CASH” below and follow me so I can send you the link.

Yields framework and investors mantra 10 year US Treasury yield is currently at 4.42, it was 3.62 in mid september. This was just after the Fed delivered a jumbo cut of 50 bps on the overnight fed fund target rate. Lets try to see what is behind the rise of yields and which are the actors responsible. The long term rates in any economy are not completely in the control of the Central bank. CB at best can alter the short term rates while the long term yields are determined by the market participants by selling or buying the bonds in that maturity bucket. CB at best can be one participant among many in that buying and selling. Like the QE policy when Fed decided to buy the long term bonds and keep the rates low. However the more QE you do, you will defile the market dynamics more and the market will become increasingly aloof to fundamentals. From a long term perspective this is not desirable. The urge to control has to be reigned in. That is why the QE policies are publicly announced and their sunset clauses are also communicated in detail. Now when an investor is thinking about long term lending, they will take multiple factors into account. Firstly will be the path of short term rates by the Fed, secondly will be how the future inflation and growth dynamics would play out, then comes the estimation of future supply and demand dynamics and last but not the least a deep thought on how volatile the above estimates are. It is one thing to forecast but it is equally important to account for the eventual misfire. Volatility demands its own price. The longer tenor forecast it is, the likelier it is expected to astray from estimates. This in common jargon is known as the term premium. While the estimates of Fed future path have remained mostly on track other factors have changed. The fiscal path to be taken by the new administration is not clear. More fiscal deficit means more bond issuance, meaning more supply and higher yields. Then comes the demand side. The demand is generated by long term investors like pension funds, banks (BASEL requirements), Fed purchases (QE) and the other Central banks. Other Central banks buy USTs because they are gaining dollars by running trade surpluses with US. These dollars are invested back in US, generating demand for US bonds and hence lowering its yield, in effect making US govt borrow at cheaper cost. However with the impending tussle with trading partners, it is likely that their dollar pile goes down and hence the demand for USTs. The tariff induced goods inflation and anti immigration induced wage inflation are also keeping the yields up but the biggest factor again is the uncertainty. Trump's approach for quick and sudden decisions ultimately make the markets wary of any long term commitment. This makes investing in a longer duration asset a bad choice. Keep it short and keep it safe, thats the mantra.

For several years, Ghana’s banking sector has enjoyed what i describe as easy money. They collect huge deposits from us and instead of lending to productive sectors of the economy, they just invest in government securities. This week, the Governor of the Bank of Ghana informed us that Treasury bills accounted for about 62% of banks’ investments in 2025. Whooping 62%! From a risk management perspective, this strategy might sound understandable. After all, treasury bills are backed by the government, highly liquid, and easy to manage compared to lending to businesses, which requires credit analysis, monitoring, and recovery processes. But the core mandate of a banking system is not to collect deposits and buy government bills but to collect monies from those with excess cash. When banks concentrate too heavily on government securities, the private sector which is the engine of growth in Ghana often suffers. That is referred to as crowding-out effect, where government borrowing absorbs financial resources that could otherwise support businesses. Maybe that speaks a lot about how poor successive governments have mismanaged the economy such that investors demand a lot for lending to the government. However, with economic conditions now changing and returns on government securities becoming unattractive, banks may consider going back to its original manadate: collect deposits, give loans especially if the current macroeconomic indicators are sustained. This development may appear to be a challenge for banks, but it could be very good news for the broader economy. As Treasury bill yields decline, banks may increasingly find themselves searching for new sources of profitability. And that search may lead them back to the private sector. For small and medium-sized businesses, this shift could represent a rare and valuable opportunity. If banks begin reallocating capital away from government securities toward business lending, entrepreneurs who are well prepared may have a better chance of securing financing. However, businesses should not assume that credit will suddenly become easily available. Banks will still lend cautiously, and they will prioritise businesses that demonstrate credibility, discipline, and growth potential. SMEs that wish to benefit from a potential increase in lending must therefore begin positioning themselves strategically. SMEs must prioritise: 1. Proper accounting record keeping 2. Sound cash flow management 3. Good corporate governance practices 4. Strong business plan with credible financial projections 5. Documentation of asset ownership for collateral purposes 6. Ethical leadership The ball is in your court, SMEs!

Treasury is still misunderstood in too many organizations. It’s seen as: • Cash reporting • Payments processing • Risk monitoring But that’s Level 1–2 Treasury. World-class Treasury operates at Level 4: • Capital allocator. • Risk strategist. • Business partner. The shift is simple, but powerful: • Reporting cash → Shaping decisions • Managing risk → Enabling growth • Supporting finance → Partnering the business What Strategic Treasury Actually Does It uses liquidity, capital, and risk intelligence to influence enterprise decisions. Not after the fact. At the point of decision. Where Treasury Drives Real Enterprise Value 1. Market Expansion → FX exposure assessment → Funding strategy design → Cash repatriation structuring 2. M&A / Investment Decisions → Liquidity impact analysis → Debt vs equity optimization → Integration cashflow planning 3. Pricing Strategy → FX-adjusted pricing models → Cost of capital optimization → Margin protection 4. Crisis Management → Liquidity preservation frameworks → Contingency funding plans → Risk mitigation execution Core Value Drivers of a Strategic Treasury Function Liquidity Intelligence → Real-time visibility + rolling forecasts Risk-Informed Decision Making → FX, IR, credit risk integrated into strategy Capital Allocation Discipline → ROIC vs WACC alignment Working Capital Optimization → Internal liquidity retention (CCC focus) Business Partnering & Influence → Translating financial insights into operational decisions The Reality Check Some treasury teams are constrained by: ❌ No seat at the decision table ❌ Weak forecasting accuracy ❌ Lack of real-time data ❌ Perception as an execution function What Needs to Change Treasury must become a decision-support engine, not a reporting layer. That means: • Scenario modeling (base / worst / best) • Quantifying liquidity impact of every major decision • Providing risk-adjusted recommendations • Embedding into capital allocation discussions The Standard Going Forward If Treasury is not answering these questions, it is not operating strategically: → Can we fund this safely? → What is the liquidity impact? → What risks are introduced? → How does this affect capital structure? Execute in 90 Days 0–30 Days: → Assess maturity → Improve cash visibility → Align with FP&A 30–60 Days: → Build forecasting capability → Introduce KPI dashboards → Launch scenario analysis 60–90 Days: → Embed into strategic decisions → Lead working capital initiatives → Influence capital allocation Treasury should not wait to be invited. I’ve distilled this into a Treasury as a Strategic Business Partner framework → Designed for Treasury & Finance leaders → Built for real-world execution → Aligned with enterprise decision-making Want to create Cheat Sheets like this? Join the waitlist here: https://lnkd.in/gB2efx_n 📌 Repost & Share!

“Why is my business always running out of cash?” This is a question every founder faces at some point. Society tells us: ❌ Revenue growth solves everything ❌ Investors will always fill gaps ❌ Cash flow isn’t urgent until it is But here’s the truth: Cash flow is oxygen. Without it, even profitable businesses struggle to survive. ✅ Delayed payments choke operations ↳ Slow inflows stall growth ↳ Unchecked outflows drain reserves ✅ Silent spending erodes liquidity ↳ Unused subscriptions and non-essential spending bleed cash ↳ Every small leak adds up ✅ Reactive management leads to panic ↳ Waiting until the crisis hits forces bad decisions ✅ Overreliance on external financing ↳ Borrowing solves symptoms, not the root problem How to keep your business breathing strong: 1. Negotiate better supplier terms ↳ Request 60-day instead of 30-day payment cycles ↳ Offer loyalty or volume commitments to gain flexibility 2. Automate invoice reminders ↳ Use software for auto-reminders and payment links ↳ Keep recurring client inflows steady 3. Convert inventory into subscriptions ↳ Bundle products into recurring plans ↳ Offer discounts for prepaid quarterly commitments 4. Audit recurring software costs ↳ Cancel duplicate or underused subscriptions ↳ Reclaim wasted spending for better allocation 5. Offer early payment discounts ↳ Give 2% off for 10-day payments ↳ Encourage faster cash inflows from trusted clients 6. Delay non-essential spending ↳ Postpone upgrades or hires until stability ↳ Prioritize operations critical to growth 7. Track weekly cash flow trends ↳ Review inflows and outflows every Friday ↳ Adjust budgets quickly based on real data Cash flow isn’t just numbers on a spreadsheet. It’s the lifeline that keeps a business alive and thriving. Which of these levers could your business use today to breathe easier? Follow me Marc Henn for more. We want to help you Retire Early, Supercharge Your Cash Flow, and Minimize Taxes. Marc Henn is a licensed Investment Adviser with Harvest Financial Advisors, a registered entity with the U. S. Securities and Exchange Commission.

Master the Art of Cash Flow Management 1. Analyze and Forecast: To master cash flow, begin with a deep dive into historical data. Analyze past cash flow patterns, identifying seasonal trends and potential fluctuations. Embrace forecasting tools to anticipate future financial dynamics accurately. This strategic foresight equips you to make informed decisions, proactively addressing challenges before they arise. 2. Optimize Working Capital: Unlock the power of working capital to bolster your cash position. Streamline inventory management, negotiate favorable payment terms with suppliers, and expedite the conversion of receivables into cash. By optimizing your working capital cycle, you can enhance liquidity and ensure a steady cash flow stream. 3. Embrace Technology for Automation: In the digital age, leverage technology to automate cash flow processes. Implement robust accounting software, integrated with cash flow forecasting tools. Automation not only reduces manual errors but also provides real-time insights into your financial landscape. Stay agile and responsive, steering your organization with precision through financial ebbs and flows. 4. Establish Strategic Partnerships: Forge strong relationships with financial institutions, suppliers, and clients. Collaborate on flexible payment terms and explore financing options tailored to your business needs. Strategic partnerships extend beyond transactions; they become pillars of support during challenging times, ensuring a collaborative approach to financial well-being. 5. Communication and Transparency: Effective communication is the linchpin of successful cash flow management. Foster a culture of transparency within your finance team and across departments. Clearly communicate financial objectives, potential challenges, and the collective role each team member plays in maintaining a healthy cash flow. Transparency cultivates a shared responsibility and a united front against financial uncertainties. As a finance leader, your role extends beyond numbers; it's about steering the financial ship through both calm waters and storms. By mastering the art of cash flow management, you not only safeguard the financial health of your organization but also pave the way for sustained growth and prosperity.