Capital International Group
Integrated Cash Solutions Cash Management | Transaction | Currency
Our Vision
The Capital International Group exists to improve lifestyles through increased prosperity.
Our Values
We seek to achieve this through the enduring values of innovation, integrity and excellence.
Our Mission
At Capital Treasury Services they aim to be the best in their chosen field and complement the Capital International Group’s vision by creating real value. They are a dynamic, entrepreneurial and visionary subsidiary of the Capital International Group, maximising efficiency by focusing on treasury management, foreign exchange, cash management and payment solutions. They provide an exciting and interactive environment offering a professional, reliable and client driven service through the Group’s enduring values of innovation, integrity and excellence.
The three core areas of treasury services cash management, transaction & currency Capital International Group
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Contents Section
Description
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Executive Summary
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2
Capital International Group
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Group | Background Independence Capital Treasury Services | Background Making the Difference
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Integrated Cash Solution
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e-Business | Innovation
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Online Payment Solution
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Bridge Security | Yield | Liquidity Bridge | Features & Benefits Addressing the Present | Securing the Future Payments that Power Business SWIFT Payment Types
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Cash Management
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Capital Liquidity Account Security | Liquidity | Yield Capital Liquidty Account | Features & Benefits Asset Allocation Risk Exposure Interest Rates Two Day Liquidity Account Structure Term Investments Standard & Poor’s Rating Agency Ratings | Credit Quality | Volatility
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Foreign Exchange
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Service Overview Delivering Quality Priceless Service Keep in Control Mitigating Risk Foreign Exchange Tools
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Customer Focused
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Reporting Fees & Charges Client Care
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In Summary
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Innovation Integrity Excellence
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Liquidity strategy is to maintain asset quality and diversity of the portfolio Capital International Group
Executive Summary From the Managing Director | Capital Treasury Services Against the backdrop of the worst financial crisis in living memory, and competing in a space where some traditional money market cash funds have ‘broken the buck’ and banks downgraded or worse, the Capital International Group and principally Capital Treasury Services Limited, a founding member of the Group, has clearly stood the ‘test of time’. We believe that Capital Treasury Services offers businesses around the world a unique opportunity to benefit from an improved and continuously monitored combination of security and competitive rates of interest on any residual or operational cash balances. Our products and services are designed to alleviate any administrative burden; we undertake all the necessary asset research to ensure you carry on receiving a competitive rate in low risk institutions. We open and close all the underlying accounts as appropriate and undertake all of the interaction with the institutions on behalf of our client’s investments. As part of our cash management services, we continually monitor the institutions we use, to ensure the security of our clients cash at all times.
Cash management is a core activity for Capital Treasury Services - our comprehensive range of pooled and designated cash management services offer investors a flexible and secure range of solutions designed to maximise returns from their short to medium term assets. At Capital Treasury Services we offer an attractive combination of traditional cash management expertise and a broad and innovative product range. With any cash management service, it is vitally important that clients enjoy peace of mind and confidence in the way their investment affairs are being managed. We are confident, that the Capital International Group, through Capital Treasury Services can provide this and that our cash management services will fully address any cash investment requirements. John E Cookson MIoD Managing Director Capital Treasury Services Limited
committed dedicated Bridge trusted Bridge Telephone: +44 (0) 1624 654294 Mobile: +44 (0) 7624 407558 Web: www.capital-cts.com E-mail: j.cookson@capital-cts.com
Innovation Integrity Excellence
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Section 2
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Capital International Group Group | Background The Capital International Group operates from the Isle of Man and specialises in the provision of investment related financial services, including trading and stockbroking, custody and administration, cash and investment management and investment structuring. In addition, the Group delivers a number of business support services including property and facilities management and various outsourcing solutions. Our origins date from 1996 when Capital International Limited was founded to provide custody, nominee and stockbroking services, later followed by Capital Treasury Services in 2007 and the other companies. Capital International Limited is a Member of the London Stock Exchange and is licensed by the Isle of Man Financial Supervision Commission. Today, the Group offers an integrated range of financial services now has in excess of $4.0 billion of client assets under management or administration. The Group has been built on its Core Values of Innovation, Integrity and Excellence to deliver the highest quality of customer service. We work closely with financial institutions such as life assurers, pension schemes, fiduciaries, fund & wealth managers, collective investment schemes, regulated financial intermediaries and other professionals. We pride ourselves on our close working relationships with clients and our ability to deliver customised solutions. As those relationships develop, clients use a greater variety of services from the Group as we become a trusted partner in delivering a universal solution. In 2010 the Group relocated from two separate offices to new headquarters in Douglas on the Isle of Man. Capital House is the Group’s sole office location and comprises over 20,000 square feet on four floors. Prior to occupation, Capital House was completely redeveloped, internally and externally, to provide high quality open plan offices and a virtual infrastructure for IT services. The Group now operates a full virtual server and virtual desktop systems architecture, providing unrivalled capability and system integrity and the ability to operate remotely.
Capital International Group
Independence The Isle of Man Government and its divisions are seeking to use local, qualified and licenced investment service providers, that are truly independent and flexible to operate globally across all industries and sectors.
Locally Global Capital Treasury Services is licenced and regulated by the Isle of Man Financial Supervision Commission; wholly owned by the Capital International Group based in Douglas on the Isle of Man. With no distant head office imposing out operating guidelines or strict investment procedures means that the Group and its underlying companies avoids irrelevance in alternative jurisdictions and has become more versatile in the global arena. The Group has a long history within the Isle of Man’s finance sector and has enjoyed a close working relationship with the Isle of Man Government and its divisions for over seventeen years. We take pride in our Manx heritage, whilst not losing this focus, we are equally happy providing financial services to the global marketplace as well as to local people, businesses, institutions and the Isle of Man Government.
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Capital Tresury Services | Background Capital Treasury Services Limited, one of the leading providers of treasury services on the Isle of Man, proudly celebrates seven years of successful portfolio and cash management. During this time they have continued to be one of the best in their chosen field and complement the Capital International Group’s vision by creating real value. They are a dynamic, entrepreneurial and visionary subsidiary of the Group, maximising efficiency by focusing on Treasury Management, Foreign Exchange, Cash Management and Payment Solutions. More than just another treasury services company; Capital Treasury Services distinguish themselves from the competition by understanding our customers’ needs and adapting their business around them. They provide an exciting and interactive environment offering a professional, reliable and client driven service through the Group’s enduring values of innovation, integrity and excellence. They believe that their success will always be based upon the skill, professionalism and commitment of everyone within the Group. The principal role of Capital Treasury Services is to offer corporate, trusts and high net worth individuals the ability to achieve significantly better foreign exchange and money market rates than our peers and couple this with exceptional service. They achieve this by growing and managing their large existing client base as well as acquiring and developing new client relationships. They take pride in successfully delivering a relationship and solution based service to their clients. The exceptional service their existing and potential new clients receive is simply based on the talented and experienced individuals that work within the Capital International Group at all levels.
The Group ethos is that everyone has an important and influential role to play
Making the Difference In a demanding international marketplace they have established a reputation for a unique and distinctive approach to business. They believe that a number of key factors differentiate Capital Treasury Services from other providers of similar services.
In-House Capability Their in-house teams of professionally qualified treasury practitioners enable them to provide clients with an exceptionally high quality and comprehensive service. In particular, it gives them the ability to handle larger and more complex products, structures and projects swiftly and with assurance.
Innovative Approach Our in-depth knowledge, across the Group, of the market and close relationships with a number of high calibre intermediaries, enables Capital Treasury Services to keep abreast of developments in treasury, investments and cash management. This, in turn, enables them to administer or manage existing structures using current best practice while offering and implementing new and innovative products and services.
Commitment to High Quality We are all extremely commited to meeting our clients’ needs and exceeding their expectations. All clients deal directly with a relationship manager, supported by a team of administrators, all of whom are committed to ensuring every client receives a timely, efficient and personal service.
Innovation Integrity Excellence
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Innovation and product development within the Group doesn’t stand still for long Capital International Group
Integrated Cash Solution e-Business | Innovation Although you may need a bank account at some point in your life, do you really need one all the time for everything you do? We know that banking culture is changing; even the building societies have started thinking along these lines. We will never truly be able to do away with banks, but, there are alternatives for a majority of the activities that relate to banking. Moreover, as banks and their corresponding jurisdictions continue to be downgraded, with some having a low or even unrated status, it needs to be stressed that the opportunities are growing in the financial services for a more joined up solution to just holding or transacting cash.
Innovation is crucial in remaining competitive; one notable solution is the integration products and services to facilitate efficient and dynamic cash management; offering automated rolling of uninvested cash, discretionary and fixed term investments as well as foreign exchange as part of their promise to maintain liquidity and make cash work more effectively. With asset diversification lworking to minimise market/counterparty risk and maintain a high level credit quality and low volatility. By ring-fencing client assets in a nominee account provides an extra level of asset security and keeps exposure away from any balance sheets. Capital Treasury Services, part of the Capital International Group, has developed an integrated solution that not only combines its flagship cash investment account with their online payment solution, but they have created a single-source online solution that offers their full range of treasury services. The Capital Liquidity Account and Bridge have, since they were introduced, been an integral part of our treasury services offering. However, by combining them along with the Foreign Exchange capabilities within the company now means that a single client has the flexibility and choice of all the treasury tools and products from the outset. Bridge now becomes more than just a payment service, but the facilitator of transactional activity into, out of and around the Capital Liquidity Account. Creating a unified solution with card services being integral, now ensures that cash movements between the Capital Liquidity Account and the loading and unloading of any pre-paid cards are more efficient and traceable.
Innovation Integrity Excellence
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Section 4
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Online Payment Solution Bridge Originally, Bridge was developed as a flexible, cost effective online solution to streamline the payment and receivable processes. Bridge allowed businesses to process regular payments more quickly, easily and economically. However, as a member of SWIFT and with high levels of built-in security, our payments solution now supports the full range of payment types including BACS, CHAPS, SEPA and other international payment types.
Now more than ever, efficient and cost-effective global transactional services play an important role in any business The ability to make and receive payments from anywhere in the world and monitor multiple accounts with different banks and financial institutions from a single source is critical in this digital age. Time management and staff efficiencies come down to streamlining administrative tasks and centralising business processes, in turn this has enables businesses to save time and money – giving those same companies more opportunities to focus on their key business areas.
The aptly named Bridge allows Capital Liquidity Account holders to manage their funds online. At the heart of the system is a facility providing client’s access to domestic payment mechanisms in foreign jurisdictions, thereby eliminating the need for third-party clearing house intervention. Designed to complement the existing suite of treasury solutions and being solely internet-based, this new offering bridges the gap between cash-based investment accounts and the requirement to pay balances away, anywhere in the world, quickly, cost-effectively and efficiently. Straight through processing has come on leaps and bounds, now no longer confined to large mulit-jurisdictional institutions – with the introduction of liquidity accounts, SWIFT and Bridge, all acting as a single conduit, Capital Treasury Services is now able to offer a global solution, fully integrating its own treasury solutions with that of a global service provider through which the financial world conducts its business operations with speed, certainty and confidence. NOTE: Any sums received do not constitute a deposit as defined in Regulated Activities Order 2011, as amended and are not covered by any compensation scheme.
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Solutions in Payments Bridge doesn’t just bridge the payment services gap, bringing global transactions to everyone on a domestic playing field, but it now levels that playing field with its active data and messaging conduit. Bridge offers you a simple, convenient and cost-effective way to make regular and receive payments via the Internet. The service’s dynamic and intuitive interface guides you through the payment creation process, enabling you to submit Straight-Through-Processing (STP) payments that will require no intervention by us. These are charged at a reduced cost when compared to the standard tariff for non-STP transactions.
You are able to access Bridge from anywhere in the world via the internet on a PC or tablet, and even on a mobile phone… Clients no longer become reliant on systems of individual banks and building societies – Bridge can facilitate the same ‘view access’ clients have of their existing accounts as well as being able to make and receive payments to and from the Capital Liquidity Account via Bridge. From this central reserve account clients are also able to access all the products and services offered by Capital treasury Services from Foreign Exchange to Card Services. Bridge provides business-critical information which remains secure, accessible and usable at all times. As a bridged-business you no longer have to focus on minimising and avoiding the risks associated with inadequate protection of business critical information.
Providing tools that will effectively and efficiently manage your cash on a day-to-day basis Online Tools Whether you just want access to your Capital Liquidity Account and make a payment or you want to be able to view all your bank accounts. Bridge provides a single point of access – thus doing away with the need for card readers and dedicated computer hardware.
Conduit Services This is the new concept of using Bridge to view other bank accounts and, at some point, the ability to apply transactions via Bridge to and from those other accounts via SWIFT.
Bridge Links This is the data support from Bridge into other Accounting/TMS/AP/AR systems which can be imported directly into these systems for reconciliation purposes.
Innovation Integrity Excellence
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Bridge | Features & Benefits Features
Benefits
Online, integrated system acting as a single point of access
View balances and transactions, track incoming or issue payment instructions from your Capital Treasury Services accounts from anywhere in the world Provides tools that effectively and efficiently help manage cash on a day-to-day basis Clients do not need to become reliant on the systems of individual banks Additionally, flexibility offered by Bridge provides reassurance in times of contingency
Immediate access online
Provides greater convenience and flexibility
Up-to-date, live, account information
Helps improve your view on your overall cash positions in multiple currencies Provides business-critical information on cash holdings
Electronic payment status updates
Ideal for faster payment confirmation, and vital for tracking important payments
Segregated cash holdings through Bridge from Security of cash assets any operational or balance sheet exposure Regularly updated application software, centrally maintained away from client servers
Gives you the latest technology with no ownership costs, maintenance requirements or upgrade concerns
Your administrator controls system access levels according to function, with permissions and security settings specified by you
Increased internal security and greater control over your incoming and outgoing payment processing
Upload balance and transaction information directly into your accounting systems
Reduces delays and potential human errors caused by re-keying data and allows consolidation of bank balances
Straight Through Processing (STP) achieved Increases efficiency and reduces costs by the use of payment validation and payment routing tools Facility to search for or validate BIC and IBAN Assists with payment routing details Faster incoming and outgoing payment confirmation
Free up your team to concentrate on growing your international business
A single point of access to local clearing systems in the overseas markets where you operate
Cuts transaction costs
Intuitive, dynamic interface
Will notify users of data entry errors before allowing payment instructions to be submitted
Overseas customers can pay directly into your Speeds up invoice receipts account through their local bank
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Addressing the Present | Securing the Future Bridge makes maximum use of current technology, but nothing ever stands still. Our customers are able to focus on their business secure in the knowledge that our commitment and that of our developers to research and development means that they have a software solution not just for today but also the future. Our modern payment software reflects the diversity of our customer base and is available in a range of configurations to suit the needs of customers of all sizes. This platform has many in-built features that specifically address the needs of the corporate customer. For example with payments the customer can define data entry levels such that individuals can only ‘sign’ payments up to their pre-set data entry level. It is also possible for them to define multi-stage authorisation such that all payments have to be approved by one, or more, members of staff before being submitted for action.
Innovation Integrity Excellence
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Payments that Power Business We facilitate online transactions, we give clients a fast, reliable way to pay and offer businesses a cost-effective method of sending funds worldwide. Our solution remove the obstacles that make sending and receiving money slow, tedious and expensive, so payments can power your business. Bridge can also be configured to work with any legacy system, thereby enabling any financial institution to offer internet services to their customers with minimal disruption to their existing infrastructure.
SWIFT SWIFT is a member-owned co-operative through which the financial world conducts its business operations with speed, certainty and confidence. More than 10,000 financial institutions and corporations in 212 countries trust them every day to exchange millions of standardised financial messages. This activity involves the secure exchange of proprietary data while ensuring its confidentiality and integrity. Their role is two-fold. They provide the proprietary communications platform, products and services that allow our customers to connect and exchange financial information securely and reliably. They also act as the catalyst that brings the financial community together to work collaboratively to shape market practice, define standards and consider solutions to issues of mutual interest. A key point of interest is that SWIFT does not hold funds nor does it manage accounts on behalf of customers, nor does it store financial information on an on-going basis. SWIFT enables its customers to automate and standardise financial transactions, thereby lowering costs, reducing operational risk and eliminating inefficiencies from their operations. By using SWIFT customers can also create new business opportunities and revenue streams. SWIFT has its headquarters in Belgium and has offices in the world’s major financial centres and developing markets. SWIFT provides additional products and associated services through Arkelis NV, a wholly owned subsidiary of SWIFT, the assets of which were acquired from SunGard in 2010.
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Payment Types Domestic Faster Payment
For transactions less than ÂŁ100,000 Same-day transfer Cheaper alternative to CHAPS
BACS Bankers Automated Clearing Services
For Sterling payments within the UK with three-day value Accounts are debited only on the day the credit arrives at the destination account, giving you use of funds until the last possible moment Ability to make individual payments or grouped payments such as payroll or supplier payments
CHAPS Clearing House Automated Payments System
For same-day Sterling payments within the UK
Internal Transfers
For payments or transfers within the Capital International Group of companies in Sterling
Faster payment mechanism than BACS No maximum transfer amount for same-day Sterling payments within the UK
The remitter and beneficiary of the payment must hold an account within the Capital International Group of companies
Non-Domestic SWIFT
For currency or Sterling payments abroad and currency payments within the UK Paid in one to three days
EURO SEPA
For EURO payments effected by EURO Domestic Payment Typically paid same day but may take up to three days Cheaper alternative to SWIFT
Internal Transfers
For payments or transfers within the Capital International Group of companies in Sterling or foreign currency The remitter and beneficiary of the payment must hold an account within the Capital International Group of companies
Innovation Integrity Excellence
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Cash Management Capital Liquidity Account The Capital Liquidity Account is an international cash investment solution managed by Capital Treasury Services Limited, a member of the Capital International Group of companies. Available in Sterling, US Dollars and Euros and tracks the UK Base Rate, US Federal Funds Rate and European Central Bank Rate respectively, ensuring your money and your client’s money is always earning a market leading rate.
Liquidity Liquidity
Security
• AAAf rated by Standard & Poor’s • Instant Diversification
Liquidity
• Pro-active liquidity management • Late dealing times with two day settlement
Yield
• Stable/consistent returns - institutional purchasing power with access to
Independence
• Isle of Man-based with no distant head office imposing operating guidelines
global markets • Highly competitive track record
or strict investment procedures - avoids irrelevance in alternative jurisdictions
• Long history within the Isle of Man’s finance sector - over 17 years
Convenience
• Outsourcing cash management • Focus on client service • Frees up time for higher value-added activities
The Capital Liquidity Account is a unique cash-only management service delivering the diversification, protection and liquidity of a money market fund, with the yield and consistency of a high interest cash deposit. The added benefit over a money market fund is that
Currency Options As previously mentioned the Capital Liquidity Account is available in three main currencies, Pounds Sterling, Euros and US Dollars; other currencies are available on request.
Minimum Investment The minimum initial investment is £50,000, $100,000 or €100,000 respectively.
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Security
Yield
In order to protect monies invested into the Capital Liquidity Account and also the reputation of the Isle of Man, these monies need to be in the safest place(s) possible with key emphasis on both counterparty credit rating and diversification.
Return on investment is not always critical, but the Capital Liquidity Account looks to achieve liquidity with the bonus of a competitive yield making the cash investment solution extremely advantageous to investors.
AAAf/S1+
0.60% APR
The Capital Liquidity Account has been rated AAAf/S1+ by Standard & Poor’s (the highest credit quality and lowest volatility ratings) for seven consecutive years. Our team of qualified investment professionals consideration of underlying deposit takers credit rating and focus on ensuring a high level of diversification within the underlying ‘pool’ of monies has been key to the retention of this highly sought after accolade, helping to keep the Capital Liquidity Account at the forefront of local investors’ ‘go-to’ investment products, especially in times of economic uncertainty and where capital protection is of utmost importance.
By blending the maturities of the deposits within the underlying pool of the Capital Liquidity Account we are able to offer investors 0.10% over rate on all balances above £1 million, or currency equivalent, on a two day liquidity basis. As the yield curve returns to normality, and longer term interest rates once again overtake their short term equivalents, we will of course ensure returns are maximised by providing fixed term alternatives for monies held within the Capital Liquidity Account which are not immediately required.
Liquidity A unique feature of the Capital Liquidity Account is that it offers institutional rates of interest coupled with two day liquidity. Account holders can withdraw their money at any time with no penalty or loss of interest incurred on withdrawal.
T+2 Liquidity The yield curve will remain for the foreseeable future very much in favour of short term monies; therefore suitable short term investment vehicles can offer as good a return as the six month equivalent, while giving liquidity and thereby avoiding any potential breakage charges should an unforeseen liquidity requirement become evident. To ensure they can maintain the level of liquidity without compromising on investment returns, Capital Treasury Services constantly monitors financial institutions with an A(Standard & Poor’s) rating or above.
Innovation Integrity Excellence
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Capital Liquidty Account | Features & Benefits The Capital Liquidity Account is not a bank account, so you are not lending money to Capital Treasury Services or any company within the Capital International Group; as a result any cash investments are not exposed to Capital Treasury Services or any other company within the Capital International Group in any way. The cash investments are placed into a ring-fenced custody account to which a high rate of interest is applied on a monthly basis. Features
Benefits
Immediate access online
Provides greater convenience and flexibility
Online, integrated system acting as a single point of access
Review your Capital Liquidity Account position including statements, transactions and overall investment position from anywhere Easier to make transfers between Capital Liquidity Account and designated accounts Minimise costs and generate competitive yields on surplus funds with on-line control of your investments
Up-to-date, live, account information
Helps improve your view on your overall cash positions in multiple currencies
Two-day access to investments
Practically immediate access to monies when needed without the need to break deposits which can prove costly
Multi-currency investments
No need to rely on foreign exchange mechanisms - the three primary currencies are GBP, USD and EUR, with others available on application
Competitive, real-time investment rates
Rates quoted are real-time - when you invest you know what your rate is, and likewise when base rates rise so will the investment return
Upload balance and transaction information directly into your accounting systems
Reduces delays and potential human-errors caused by re-keying data and allows consolidation of bank balances
Segregated cash holdings from any operational or balance sheet exposure
Security of cash assets
Standard & Poor’s AAAf/S1+ rated High Credit Quality Low Volatility
Independently rated and monitored by a globally recognised agency Ensures adherence to investment criteria relating to credit quality and volatility ratings Independent reporting from the rating agency is available for investors offering full transparency on cash assets Provides a historical reference to consistency and consecutive ratings
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Capital Liquidity Account minimises costs and generates competitive yields on surplus funds Innovation Integrity Excellence
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Liquidity strategy is to maintain asset quality and diversity of the portfolio Capital International Group
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Asset Allocation The asset allocation strategy is to invest in high quality bank and building society deposit accounts which have been rated A to AAA, A1+ or A1 by Standard & Poor’s rating agency. The strategy is to maintain asset quality and diversity of the portfolio in accordance with Capital Treasury Services’ asset quality guidelines. • Income Potential - Low to Medium* • Volatility / Risk Level - Very Low • Investment Time Frame - No minimum Cash is seen as an important asset class by Capital Treasury Services and as such the Capital Liquidity Account has a diversified pool of cash deposits with different banks and building societies. Diversification reduces the level of risk on a portfolio - it does not necessarily reduce the returns, this is why diversification is referred to as the only free lunch in finance.
Risk Exposure In order to generate the high yields payable to Capital Liquidity Account holders, the underlying treasury pool is managed by Capital Treasury Services utilising a diversified range of high quality bank and building society deposits. • We manage Credit Risk through a list of approved banks and building societies. Every issuer on the list is monitored on an ongoing basis by our experienced team. • We manage Liquidity Risk by limiting the Capital Liquidity Account’s underlying cash assets weighted average final maturity and adjusting those cash assets to better match the Capital Liquidity Account investment profile. • We manage Interest Rate Risk by monitoring the forward yield curve and limiting the Capital Liquidity Account’s weighted average maturity.
* This is subject to change due to changes in base rates
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Interest Rates Capital Treasury Services sets the interest rates applicable on behalf of the Capital Liquidity Account daily, which are publicly available on request. While we reserve the right to vary the basis on which interest rates are set at our discretion; rates will target the following scale:
Investment Amounts
Target Yield
£50,0001
$100,000
€100,000+
Base -20bp
£100,000
$250,000
€250,000+
Base -10bp
£250,000
$500,000
€500,000+
Base
£500,000
$1,000,000
€1,000,000+
Base +5bp
£1,000,000
$2,000,000
€2,000,000+
Base +10bp
The Capital Liquidity Account service is based in the Isle of Man and as such interest is paid gross to all Capital Liquidity Account investors.
Two Day Liquidity A unique feature of the Capital Liquidity Account is that it offers institutional fixed-term rates of interest coupled with two day liquidity, meaning you have easier access to your investment capital at any stage. Account holders can withdraw their money at any time and we will make the transfer within two business days of receiving your instruction. Although there is no penalty or loss of interest incurred on withdrawal, there may be transfer fees to take into account. 1
While the Capital Liquidity Account is designed for amounts of £50,000 or greater, we may facilitate smaller amounts at our discretion.
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Account Structure Client monies in the Capital Liquidity Account are held within a ring-fenced custody account with Capital International (Nominees) Limited, a member of the Capital International Group The Group provides global custody services via our own nominee company - ensuring fast and efficient transaction and settlement as well as servicing a selection of experienced professionals, institutions (from e-gaming through to aviation and shipping) and fund structures looking for administrative and custody solutions. No investments are made directly on, or for, any Capital Liquidity Account and account holders can access the monies deposited within two working days notice. Capital Treasury Services ensures that a competitive level of interest is paid on each Capital Liquidity Account, calculated daily and paid monthly in arrears.
Term Investments We all want our money to earn interest when we’re not using it, but we all have different needs. You may not want to see your investments tied up for a long period of time, yet you still want to earn a competitive rate of interest. At Capital Treasury Services, we have developed a range of solutions that are designed to meet your requirements - the two principal options available are:
Fixed Term Investments We agree the interest rate with you, in advance, and this rate is fixed for the whole period of the investment. Effectively the investment is locked away for the investment period and is only made available on maturity.
Call Accounts The interest rate is not fixed, but neither is the investment period, you receive interest at a rate that is linked to the money markets. It should be noted that from time to time, where interest rates in a country are particularly low, we may be unable to pay interest on accounts in the currency of that country. Both these strategies involve implementing pre-agreed investment parameters and executing market trades on your behalf. It is a multi-currency service through which cash movements are monitored and investments placed in a variety of cash instruments where the aim is to achieve an enhanced return, subject to maintaining a pre-agreed operating balance. Although these investments can utilise the same underlying assets they are not afforded the same Standard & Poor’s rating as holding Sterling, Euros or US Dollars within the Capital Liquidity Account.
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Standard & Poor’s Rating Agency Standard & Poor’s aim is to become the leading provider of global credit benchmarks and research across industries, asset classes, and geographies that investors, businesses, and markets use to foster economic development and growth around the world. As one of the world’s leading providers of independent credit risk research and benchmarks, they publish more than a million credit ratings on debt issued by sovereign, municipal, corporate and financial sector entities. Across 23 offices around the world, they have over 1,400 analysts, managers and economists continually assessing the variables that affect creditworthiness. In frequent dialogue with senior managers and industry leaders, they examine everything from the state of an enterprise and its position in its industry, to the state of a region and the globe. They continually assess and reassess their ratings methodologies, adopting changes as needed to respond to the changing needs of investors, issuers and markets. All of this enables them to offer insightful opinions that help market participants make more informed business and investment decisions.
NOTE: Standard & Poor’s Fund Ratings represents an opinion only, not a recommendation to buy or sell.
Ratings | Credit Quality | Volatility Over the last seven, consecutive, years Standard & Poor’s Ratings Services have assigned its AAAf1 fund credit quality rating and S1+2 volatility rating to the Capital Liquidity Managed Accounts, the underlying portfolios of the Capital Liquidity Account: • Capital Liquidity Managed Account - GBP • Capital Liquidity Managed Account - USD • Capital Liquidity Managed Account - EUR These managed accounts form the underlying pool of assets supporting the individual Capital Liquidity Accounts managed by Capital Treasury Services. In addition to the client account reporting, Capital Treasury Services also send out on a monthly basis the Standard & Poor’s analyst reports - these are also available for download via the website at www.capital-iom.com.
Capital International Group
1
The ‘AAAf’ ratings assigned signify the extremely strong protection the three underlying portfolios of assets provide against losses from credit defaults.
2
The ‘S1+’ volatility ratings recognise that the three underlying portfolios of assets will demonstrate extremely low sensitivity to changing market conditions.
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Insightful opinions that help make more informed business and investment decisions Innovation Integrity Excellence
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Foreign Exchange Service Overview Foreign Exchange is a part of the Capital Treasury Services core service offering, with lines into institutional market makers and liquidity providers, both in the Isle of Man and London. We transact foreign exchange deals on behalf of other financial institutions as well as large corporate entities that range from small Island-based corporate service providers to listed FTSE100 companies. They come to us because we are able to provide them with more competitive pricing structures than they receive from their existing banking relationships and treasury service providers.
Analysis We provide accurate and proactive analysis of where exchange rates are heading and why. In addition, we also offer bespoke research for clients on their individual currency requirements.
Proactivity There are two ways in which an information flow may reach you, proactively or reactively. Typically, many of the larger financial institutions, mainly because of their size, fall into the latter category. However, Capital Treasury Services prides itself in being the former. A good example of this is that a bank will rarely concern itself with your foreign currency requirements until such time as you pick up the phone, and at this point the client is quoted a single-sourced static price; Capital Treasury Services however constantly reviews the market, searching for the best rates available and will strive to better them where we can.
Tailored Service Capital Treasury Services is constantly seeking to provide an exemplary service to its clients, whether to businesses or individuals, that fits their needs. Some clients may only place one transaction with our foreign exchange service, for instance when buying a property abroad, and may need more assistance on a deal-by-deal basis to understand the complexities of the Foreign Exchange markets.
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Delivering Quality Capital Treasury Services and the Capital International Group have been working closely with clients, both private and institutional, for over fifteen years and our team of specialists really do understand the issues faced by businesses that have foreign exchange and international payment requirements. Our experience in the industry has allowed us to develop an innovative range of products and services that will minimise your foreign exchange risks, provide financial value and take the hassle out of international payments. We deliver value by combining competitive foreign exchange pricing with the most efficient methods of managing international payments. Our committed effort in understanding your needs and objectives enables us to deliver financial efficiency giving you more time to focus on your core business activities. We are committed to delivering excellence in customer service, creating and delivering innovative products, services and solutions to help your investments grow and compete more effectively within the global market place. By working with Capital Treasury Services our clients benefit from: • A dedicated team focused on saving you time and money when dealing with your foreign exchange requirements • Dedicated payment specialists that will allow you to achieve great efficiencies when dealing with your international payments • A flexible and personalised service, whilst leveraging the use of technology to make the experience simple and easy • Seamless integration and on-going support • A wide range of tools and information enabling you to mitigate risk and improve your company’s bottom line.
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Priceless Service We make buying and selling foreign currency and international payments one simple process – you can deal with us by telephone, fax or e-mail. Your dedicated account executive will confirm the rate with you immediately and send you confirmation by fax, email or post.
Whether you are paying a supplier or completing an inter-company transaction, Capital Treasury Services removes the complexity of crossborder transactions and provides you with simple options. Your dedicated corporate trader will work with you to understand your foreign exchange requirements, volumes, currency pairs, seasonality and timeframes to ensure your needs are covered at all times.
Foreign Exchange Value added services We understand that buying currency is not always a matter of buying at the best price but doing it at the right time. At Capital Treasury Services you will get access to a number of value added products and services to help you be more efficient in your decisions: • Limit orders, to buy or sell currency when the price is right • Market watch, to ensure you don’t miss out on market movements • Rate watch, get a call when the market hits your target price • Daily market news, to be on top of what is going on
Capital International Group
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Keep in Control Since January 2012, Capital Treasury Services has been making international payments on behalf of customers to numerous beneficiaries all over the world, through our global banking network which provides secure, reliable, immediate delivery and receipt of outgoing and incoming funds. At Capital Treasury Services our objective is to make the payment process simple, secure and automated, allowing your organisation to benefit from: • Single and multiple international payment instruction processing • Automatic payment and receipt notifications • Multiple reporting options • Transparent pricing • Dedicated team of payment specialists • Outstanding system security and regulatory compliance.
Making international payments We make international payments a simple and easy step integrated into the foreign exchange ordering process. International payments can be made by: Telegraphic Transfer - a SWIFT electronic payment service for transferring funds globally, to meet the demands of international business. You can ask Capital Treasury Services to send or receive funds for you using Telegraphic Transfers (also known as wires, TT, International Wire Payment or RTGS payment)
International Payments Value added services With Capital Treasury Services you will be in control of the complete payment lifecycle and have access to a large range of payment related value added services: • Formatting and payment routing • Payment status tracking • Suspect payment verification: duplicate checking, OFAC and FinCen • IBAN verification service • Invalid payment repair service • Payment confirmations • Investigation and reporting service
Bulk payment processing With our bulk payment processing service you will be able to execute multiple payment instructions simultaneously in different currencies, to different countries and beneficiaries. This service will allow you to save money and reduce the workload required to process them at any given point in time.
Innovation Integrity Excellence
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Mitigating Risk Capital Treasury Services provides a portfolio of instruments and services that can assist your organisation to minimise foreign exchange risk. Clients who have a foreign exchange requirement need a specialist partner with the skills to understand your exposures, processes and cash management requirements and Capital Treasury Services can assist you to: • Understand which currencies and economic elements you are exposed to, their risk profile and market sensitivity • Combine a range of products and services to mitigate your foreign exchange risk • Protect your operating margins in uncertain economic climates • Develop a long-term foreign exchange hedging strategy • Improve your cash management process increasing your working capital • Remove the hassle from the complex world of international payments • Allow you to focus on your core business
Capital International Group
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Foreign Exchange Tools Several foreign exchange contract types are available to our clients that can both mitigate risk and gain maximum benefit from fluctuating currency markets. Tools such as Stop Loss and Limit Orders are normally only available to blue chip companies and those trading large volumes. However, we are pleased to offer these tools to all of our clients. Contract Type
Description
Why use it
Spot Contract
This is the most common contract type and needs to be settled within 48 hours of agreeing the contract.
You need the currency immediately or want to take advantage of a beneficial rate and hold the currency on your account.
Forward Contract
This is for the purchase or sale of a currency on a fixed future date.
• If you do not have all of the funds currently available
A forward contract will guarantee an exchange rate for a future date, regardless of subsequent market fluctuations.
• To guarantee a rate for future date
Forward rates are calculated using the prevailing spot rate at the time of booking and the interest rate differential between the currencies involved and vary depending on the length of the contract. Derivatives/Options: Forward Plus Contract
This provides a guaranteed worst-case rate to hedge against any decrease in a currency ‘put’ and provides the potential to deal at the market rate providing the exchange rate remains above a predetermined limit rate.
• Takes advantage of a favourable rate • To protect against market fluctuations • To benefit from the flexibility of draw-downs & roll-overs
• Ability to deal at better than the current market rates • Provides complete cash flow • Zero premium cost solution
Derivatives/Options: Dual Currency Deposit
Currency-based yield enhancement • Fixed term investment with products can enable investors to earn guaranteed coupon paid at maturity a higher than standard coupon on their • Principal may be repaid in either fixed investments by reflecting a view on specified currency a specified currency pair. The investment rate coupon is guaranteed irrespective of exchange rate moves. However, if the exchange rate at expiry is at or above the specified ‘strike’ rate the capital is returned in the secondary currency, converted at the strike rate.
Stop Loss
This is for the purchase of currency • You have an imminent requirement that is required imminently, where the for currency purchaser wants to wait and see whether • You want to benefit from market the market moves in his or fluctuations but also want to her favour, but needs to achieve a limit your risk to unfavourable minimum rate if the market moves in market movements the opposite direction.
Limit Order
An order to purchase currency at a • You do not need the specified rate of exchange that is not currency immediately currently available. An order will be • You have an ongoing or future triggered automatically should the currency requirement and want to desired exchange rate be reached. secure a beneficial exchange rate.
Innovation Integrity Excellence
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Customer Focused Reporting Every Capital Treasury Services account holder has full on-line viewing access to their account and the latest interest rates available, all via our website at www.capital-cts.com. Additionally, account holders will receive monthly statements on their account, together with a review of the interest rate performance, in comparison to the market. At the end of every investment quarter, March, June, September and December, all Capital Treasury Services account holders are entitled to, on request, receive a copy of our quarterly Investment Review, providing an update on financial markets, investment opportunities and the latest strategy comment from the Group.
Fees & Charges There is no management or administration charge for this service. The quoted rates of interest will be paid to Capital Liquidity Account investors without any deductions. There are no charges for transferring amounts into any Capital Liquidity Account. Capital Liquidity Account holders may request a withdrawal at any time which are subject to a nominal charge to cover associated correspondent bank fees. For further details please refer to our Standard Withdrawal Fees rate sheet. For regular and/or frequent small transfers please speak to Capital Treasury Services about their on-line payment service, Bridge: Internet Payment & Cash Management.
There is no management or administration charge for using the foreign exchnage service.
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Client Care We take client care very seriously. We are proud to have some major international corporations as our key clients and we understand that client satisfaction is essential to our success. We have a comprehensive Client Care Programme to ensure we are delivering our clients the best service possible. Below is a summary of what it includes:
Communication We listen, ask questions and challenge our clients so we understand their business, enabling us to develop pragmatic and intelligent solutions. We build collaborative relationships with our clients to deliver sustainable and innovative solutions to their business issues.
Advocacy By understanding our clients’ business issues and needs, we act as an advocate for our client whenever we deal with regulatory agencies or other third parties. We involve our clients in the project, we ask for their opinion and we deliver the project according to their schedule.
Responsiveness Once we have delivered a project, we follow up to make sure the client is completely satisfied that we have provided them our best throughout the project. We maintain flexibility to fit with our clients’ resourcing requirements.
Excellence We focus on delivering the best result at a realistic price that reflects the value we have delivered to our clients. We offer a significantly diverse range of services meaning that we can offer our clients a complete solution to all their environmental and sustainability challenges.
Innovation Integrity Excellence
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In Summary An operator should look beyond the core requirements when choosing the Capital International Group and Capital Treasury Services as a partner. These are the four main considerations operators should look at in this decision: • • • •
Reliability Experience and competence Support Flexibility
We believe we address all these aspects, but notwithstanding we are constantly looking at ways as to how to improve on this.
No one size fits all and each business has its own requirements In this context, we have developed a range of services and support tools to allow for a fullservice customer experience. We’ve undertaken considerable investment to extend our reach, these include a customer relationship management solution and SWIFT capabilities.
Capital International Group
Investor Protection Neither Capital Treasury Services or other members of the Capital International Group are banks and do not offer banking services, so unlike a bank account investors are not lending money to us or the Group and as a result their money is not exposed to the Company’s or Group’s balance sheets or underlying business in any way. Consequently, client monies are fully protected at all times as they are held in segregated client bank accounts within a ring-fenced nominee custody account. No investments or transactions are made on your account (other than transfers instructed by you and interest paid by Capital Treasury Services or the Capital International Group of companies) and hence any investments made on behalf of your Capital Treasury Services Account are not subject to any specific investment, market or transactional risk. As a result, monies invested into a Capital Treasury Services Account enjoy a very high level of security. In relation to Payment Services any sums received do not constitute a deposit as defined in Regulated Activities Order 2011, as amended and are not covered by any compensation scheme.
Further Information For more information go on-line to our web portal at www.capital-iom.com or alternatively contact us at the details below: E-mail: Telephone: In writing:
info@capital-iom.com +44 (0) 1624 654200 Capital International Group Capital House, Circular Road, Douglas, Isle of Man, IM1 1AG
Innovation Integrity Excellence
Capital International Group
www.capital-cts.com T : +44 (0) 1624 654299 F: +44 (0) 1624 654291 E: info@capital-cts.com Capital International Limited is a member of the London Stock Exchange Capital Treasury Services Limited and Capital International Limited are members of the Capital International Group Capital Treasury Services Limited and Capital International Limited are licensed by the Isle of Man Financial Supervision Commission Registered Address: Capital House, Circular Road, Douglas, Isle of Man, IM1 1AG
Winner 2010 Company of the Year
Capital International Group Isle of Man Newspapers
awards for
excellence
CTS - CLA Brochure - V1.01-10.13
Capital International Group Capital House Circular Road Douglas Isle of Man IM1 1AG