Our team support Ireland’s largest corporate enterprises and financial institutions with their cash management, foreign exchange and interest rate exposures. We also work closely with our customers to assist you with more complex risk management needs.
our dedicated team of treasury managers can guide and support your business through the fast changing and evolving global markets environment.
International trade can be both a challenging and richly rewarding business – but it’s not without risk. As well as contractual and commercial conditions, factors such as political, economic and transfer risk all have a bearing on whether trade transactions are secure and profitable. That is why protecting your business against the unique and complex risks associated with international trade, particularly in emerging markets, is our priority.
How can we help?
Whatever your international trade requirements might be, as the leading treasury services provider in Ireland we can help you overcome the risks and challenges associated with:
Bonds & Guarantees for tendering and performing under international contracts
Advance Payment Guarantees
Securing payment for export goods using Export Letters of Credit
Competing with your competitors by offering extended credit terms through -Export Letters of Credit
Securing delivery of imported goods through Import Letters of Credit
For additional details on the risks you may face and the solutions, please click here.
For Bonds, Guarantees and Import Letters of Credit please contact your relationship manager directly as credit approval is required in order to facilitate transactions of this nature.
For details on Trade Finance’s network of global correspondence banks which your business may require us engage with and take credit risk on please contact the Trade Finance team at the details below.
For additional details on the risks you may face and the solutions, we produced some guides which may be useful for your business
Bank of Ireland offers a comprehensive range of foreign exchange services, including the operation of foreign currency account. We currently offer accounts in all major currencies including Sterling, US Dollars, Australian Dollar, Canadian Dollar, Swiss Franc and Polish Zloty.
A wide range of deposit options on offer including call, fixed deposits and long-term offerings as well as providing tailored solutions from competitively priced and innovative deposit products to more complex investment products.
FX Forward is a binding contract between two parties to exchange an amount of one currency for another, at a fixed exchange rate, on a date in the future. Their key objective is to deliver certainty of cost and therefore protecting your operating margins from adverse currency movement.
A collar structure provides a secured protected rate, while still allowing beneficial moves to a pre-determined level, which is the best-case scenario. If the spot rate at expiry is more favourable than the best-case rate then the holder of the collar is obligated to transact at the best-case rate. If the rate is in-between the best-case rate and the protected rate the holder of the collar can transact at the spot rate. If the spot rate at expiry is less favourable than the protected rate then the holder of the collar can transact at the protected rate. Collars are generally structured as zero-cost premium products. Watch Video
A participating forward structure provides a secured protected rate, while still allowing beneficial moves on a predetermined portion of the amount hedged. If the spot rate at expiry is more favourable than the protected rate then the holder of the participating forward is only obligated to transact a predetermined proportion of the hedged amount at the protected rate and is free to transact the remainder at the spot rate. Participating forwards are generally structured as zero-cost premium products.
A forward extra structure provides a secured protected rate, while still allowing beneficial moves up to a pre-determined trigger level. If the trigger level is met or exceeded at any time during the life of the trade, the holder of the forward extra is obliged to deal at the protected rate. If the rate on expiry is in-between the trigger level and protected rate, the holder of the forward extra can transact at the spot rate. If the spot rate at expiry is less favourable than the protected rate the holder of the forward extra can transact at the protected rate. Forward extras are generally structured as zero-cost premium products.
An Average Rate Forward allows the buyer to lock in forward points and a spot rate (a forward hedge “Strike” rate) today, in a similar manner to a conventional forward, but reduces the volatility of the payout, as the final settlement is calculated based on the average spot rates observed over an agreed period (the “Average” rate) not simply the final spot price. The Average rate is calculated using daily spot rates and can be observed daily, weekly, monthly or quarterly depending on the buyer’s preference. When the Average rate is calculated it is compared to the Strike rate and this will determine the payout at expiry.
A type of option in which the strike price is based on an average of the spot rate over a period of time. The dates used to calculate the average strike price cover the life of the option, and are referred to as the "fixings". When the expiration date of the average strike option is reached, the option is considered in the money if the spot rate is higher than the average strike.
An interest rate swap is an agreement between two counterparties in which one stream of future interest payments is exchanged for another based on a specified principal amount. Interest rate swaps usually involve the exchange of a fixed interest rate for a floating rate, or vice versa, to reduce or increase exposure to fluctuations in interest rates.
An interest rate cap is a derivative in which the buyer receives payments at the end of each period in which the interest rate exceeds the agreed strike price. They allow the buyer of the Cap to participate in rates moving lower while guaranteeing a maximum rate. They involve the payment of a premium to achieve this.
The cap rate is set above the floor rate. The objective of the buyer of a collar is to protect against rising interest rates (while agreeing to give up some of the benefit from lower interest rates). The purchase of the cap protects against rising rates while the sale of the floor generates premium income. Watch Video
Swaptions are helpful in managing possible interest rate risk occurring at some time in the future. An Interest Rate Swaption gives you the right (but with no obligation) to enter into an Interest Rate Swap at an agreed interest rate on a set date in the future.