A global in-house bank for a newly demerged mining company
More than 70 bank accounts closed in the first year
A newly listed FTSE mining company, formed through a demerger, inherited legacy SAP treasury and intercompany lending solutions built for its former parent.
Legacy SAP treasury extended into an award-winning global in-house bank
70+
Bank accounts closed in the first year
9 months
To a fully functional in-house bank and global POBO rollout
80%+
Reduction in internal settlements through cashless netting
The challenge
With maintenance and fit risks in the inherited solutions, and a mandate to cut costs after the demerger, the client asked SkySparc to assess SAP Treasury and a global in-house banking model.
- Processes not optimised for the new business model
- An excessive number of bank accounts and associated banking costs
- Physical intercompany settlement causing FX conversion costs and cross-border cash movement
- Payment timing, reconciliation and reversal challenges in shared services
- Withholding tax and regulatory complexity
The solution
The business case targeted the closure of around 100 bank accounts and a cashless settlement model for intercompany payments, and SkySparc was selected to deliver it.
- A global POBO payment factory using SAP In-House Cash
- A cashless intercompany clearing solution
- Receipts on behalf of structures, mainly in APAC
- SAP In-House Cash integrated with HR, treasury, cash and financial processes
- Bank statement clearing with nearly 100% automated matching
- A phased payments cutover avoiding big bang risk
The result
The client now runs an in-house bank with three cash centres covering Australia, South Africa and the rest of the world.
- More than 70 bank accounts closed in the first year
- A fully functional in-house bank and global POBO rollout in nine months
- More than 80% reduction in internal settlements through cashless netting
- Daily payment process runtime cut from seven hours to three
- Winner of the Treasury Today Asia 2017 award for best application of technology
"A key differentiator of success on this project was the strong engagement from the business teams and a clear, up-front transformation vision targeting realistic benefits." Deputy Treasurer