Bank Treasury Operations

Bank Treasury Operations

This course will enable you to understand financial market and enrich your knowledge about various money market, debt market, equity market and derivative market instruments. The course is focused on the needs of professionals wishing to acquire knowledge of Bank Treasury Operations.

What will you learn?

  • Understand the overview of financial markets
  • Understand the functions of bank’s treasury operations
  • Understand the money market, debt market, equity market and derivative market instruments
  • To know the major participants in foreign exchange market
  • Understanding type of Foreign Exchange transactions
  • To understand the major risks in foreign exchange operations and money market
  • Understand the various hedging techniques employed by corporations

Course content:

Integrated treasury functions

  • Asset and Liability Management
  • Control of dealing activities and risk exposure management
  • CRR/SLR maintenance
  • Centralised cash management and fund transfer pricing

Treasury Organization and their roles/functions

  • Front office
  • Mid office
  • Back office

Financial market

  • Money markets
  • Bond markets
  • FX markets
  • Derivatives market
  • Equity markets

Treasury basics

  • Time value of money
  • Day count conventions and interest computations
  • Master agreements
  • BR, SGL Forms
  • Rate scans
  • Voice recordings

Entities in the market and their roles

  • Issuers
  • Customers
    1. Corporate customers
    2. Bank customers
  • Central counter-party
  • Brokers
  • Markets
  • Regulator
  • Banks
  • Depository/custodian
  • Associations like FEDAI/FIMMDA
  • Information providers : Reuters, Bloomberg

Overview of treasury processes

  • Types of trades
    1. Proprietary trades
    2. Customer trades
  • Securities and funds settlement process
    1. Depository settlements
    2. Funds settlements
    3. Failed settlements
    4. Interest and other claims
  • Documents used and their importance
    1. Deal ticket
    2. Blotter
    3. Position pad
    4. Confirmation/affirmation
    5. Banker’s receipt
    6. SGL Form


  • Primary markets
  • Secondary market
  • Third/fourth market
  • OTC markets
  • Security borrowing and lending

Risk management in treasury

  • Understanding and measuring credit risk
    1. Transaction credit risk
    2. Portfolio credit risk
  • Understanding and measuring market risk
    1. Interest rate risk
    2. FX risk
    3. Price/equity risk
    4. Commodity risk
  • Understanding and measuring liquidity risk

Introduction to treasury asset products and
treasury liability products

  • Asset Products / Instruments
    1. Call /Notice Money Lending
    2. Term Money Lending/Inter-bank Deposits
    3. Investment in CDs
    4. Commercial Paper
    5. Inter-bank Participation Certificates
    6. Derivative Usance Promissory Notes/ Bankers’ or Corporate Acceptances
    7. Reverse Repos/ CBLO
    8. SLR Bonds
    9. Non-SLR Bonds(Guaranteed/Non-Guaranteed)
    10. Asset-backed Securities
  • Preference Shares
  • Equity
  • Mutual Funds (Equity/Debt/Balanced)
  • Liability Products/Instruments
    1. Call /Notice Money Borrowing
    2. Term Money Borrowing
    3. CD Issues
    4. Inter-bank Participation Certificates
    5. Repos / CBLO
    6. Refinance
    7. Tier II Bonds
    8. Swaps (INR borrowing, forex asset)

Foreign Exchange

  • Entities in the market and their roles
  • Exchange rate determinants
  • Exchange rate arithmetic
  • Interbank offered rates
  • Types of FX deals
    1. Merchant deals
    2. Interbank deals
    3. Cross currency deals
    4. Cover operations
    5. Proprietary trading
  • Major risks in FX
    1. Herstatt risk/settlement risk
    2. Exposure risk
    3. Transaction risk
    4. Translation risk
    5. Economic risk
    6. Trading risk
    7. Counterparty risk
  • Foreign exchange risk management
    1. Risk management through limits
    2. CLS bank operations
  • FX operations : buy/sell, lend/borrow, swaps
  • Remittance facilities
  • Nostro/vostro management and reconciliations

Domestic treasury operations

  • Investment policy
  • Classification and valuation of investments
    1. Held till maturity (HTM)
    2. Available for sale (AFS)
    3. Held for trading (HFT)
  • Shifting in categories
  • Investment fluctuation/adjustment reserve

Money market products

  • Call money, notice money, term money
  • T Bills and T Notes
  • Repo and reverse repo
  • Liquidity adjustment facility (LAF)
  • Collateralised borrowing and lending (CBLO)
  • Commercial papers
  • Certificates of deposit
  • Derivative usance promissory note (DUPN)
  • Bankers acceptance/corporate acceptance

Domestic treasury (Money Bond, Equity and
Mutual Fund Markets)

Domestic treasury products including SLR and Non SLR securities

Bond market products

  • Bond mathematics
    1. Current yield
    2. Yield to maturity
    3. Yield curve
    4. Duration
    5. Value at Risk (VaR)
  • Risks in bond markets
  • Bond ratings – Internal and external
  • Risk management through limits
    1. Duration based limits
    2. Maturity based limits
    3. Ratings based limits
    4. Issuer based limits
    5. Debt market products
  • Types of bonds
    1. How bond markets work
    2. Bond valuation and bond yields
  • Trading in bond markets
    1. Issuers in the primary markets
    2. Credit rating and credit rating agencies
    3. Players in the secondary markets

Forward and futures contracts

  • Trading on margin
  • Relationship between cash and future prices
  • Hedging strategies
  • Trading strategies
  • Off-setting contracts

Derivatives Market

  • What are derivatives
  • Forward and futures

Swaps transactions

  • Interest rate swaps/Forward Rate Agreements (FRAs)
  • FX swaps and currency swaps
  • Equity swaps

Forward and futures contracts

  • Trading on margin
  • Relationship between cash and future prices
  • Hedging strategies
  • Trading strategies
  • Off-setting contracts

Options and swaps

  • Options contracts
  • Pricing an option
  • The Greeks
  • Trading strategies for options

Managing risk and trading

Regulatory reporting

  • Reporting to the market regulator/s

Integration of treasuries

  • Opportunities in integration of treasuries
  • Structuring integrated treasury deals

SWIFT operations

  • What is SWIFT
  • How SWIFT operates
  • Important SWIFT message types

Integrated Treasury Management and Bourse Game


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