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Dealer of the Year 2000 Back  
In late November the Irish Association of Corporate Treasurers held their annual award ceremony n the offices of the ESB in Dublin. The awards are always hotly contested with all of the IACT members taking part in the survey of views. This year the Treasury Economist and Electronic Bank categories were added. The individual winners give us an insight into the year in corporate treasury and a look forward to 2001.
individual winners

Brian Kelleher, IACT Dealer of the year 2000, AIB Group Treasury

Brian Kelleher won the top spot in 2000 as dealer of the year, repeating his 1998 achievement. He has been a member of AIB Treasury for the past 14 years. Interests include golfing at Luttrellstown Castle in Dublin and Tralee Golf Club in Kerry. Brian has a keen interest in all sporting activities, especially Gaelic football and hurling.

‘I am delighted to be awarded the top prize again this year but really I am accepting it on behalf of AIB Treasury. Without the resources, assistance, hard work & keen pricing from the group as a whole it would not be possible to achieve this award.’ he said.

Look back on 2000
The year 2000 has been a difficult one for Corporate Treasurers, some Treasurers (mainly Exporters) elated with the strong US$ & GBP while other Treasurers (mainly importers from the US & UK) having a very tough year as the Euro currency remains weak. The high volatility in the EUR/US$ & Cable over short periods of time has kept Treasurers searching for suitable hedging strategies, while at the same time endeavouring to part-take in Currency weakness as it occurs.

Currency Forecasting is proving as difficult as ever, it is imperative that Treasurers maintain a good treasury policy & seek expert advice on issues that are not fully understood. In association with Arthur Andersen we in AIB Treasury initiated ‘Exchange Your Views’ in late 2000, a seminar/course that gives Senior Management & Treasurers an opportunity to re-focus on policy & strategy in the light of further regulatory issues in the market.

The steady rise in Euro interest rates predicted in late 1999 has certainly materialised. The increases have not been enormous by any means, a tribute to our participation in the Euro Currency. When one looks at the present interest rates and compares these to those of the early 90s, one sees real value and hence one aspect of the continued boom in the Economy. The fact that the Euro Currency has not appreciated over the year is somewhat surprising despite collective & selective intervention on behalf of the Euro by Central Banks.

Outlook for 2001
With signs of a US economy slow down and the interest rate differentials between the Euro the US and GBP narrowing, perhaps next year we will see the Euro rally. A brave call I know!; but whatever happens Treasurers must not be deflected from making sound decisions regarding open foreign exposures as they arise. Many Treasurers have been ‘sailing with the wind behind them now for the past 2 years, meeting those coming from the opposite direction struggling into a gale force storm but surely the wind eventually changes and Treasurers must watch the ‘forecast’ & ‘sail’ accordingly.’

John Moclair, 1st Runner up of IACT Dealer of the Year 2000, BNP Paribas

John Moclair is Head of Fixed Income Sales at BNP Paribas. John started his treasury career with ESB in 1987. In the late 1980s, he moved to FTI Finance where he worked as a consultant and portfolio manager. During this period, he was responsible for developing and implementing foreign exchange and debt risk management strategies for a number of major Irish Companies. He joined BNP in 1995, where the Sales Team provides risk management solutions to the top Irish based Corporates and Institutions.

John is a member of the IACT, the UK ACT ( via exam) and CIMA. Since joining BNP he has won the dealer of the year award on 3 occasions.

This is the 3rd year in succession that BNP Paribas has been voted 2nd runner up in the Institution of the Year category. Moclair says that ‘BNPP are very happy with this award’. He believes that ‘it recognises BNP Paribas as a top global bank which is committed to a strong coverage of the Irish Market. In this respect, the integration of Paribas with BNP has created synergies that allow BNP Paribas to offer an unrivalled range of services to our client base.’ He added that they hoped to build on this strength in the coming year.

‘A noticeable development in 2000 was the emergence of risk management products that were more in tune with the need of Treasurers. This is a welcome development for the industry as a whole as banks need to be more in tune with the needs of its corporate clients. Good calls in 2000 included the decline is the US stock markets and the sharp rise in Irish inflation.

At the time of writing, the interest rate markets are pricing in rapid cuts in US rates. It looks at little ‘over -exuberant’ given the possibility of a lag in the inflationary scenario and the underlying strength of U.S. the labour market.’

Dermot Horan, 2nd Runner up of IACT Dealer of the Year 2000, Bank of Ireland Treasury & International

Dermot Horan joined Bank of Ireland in 1984 and worked in the James Street Branch until 1991. He moved to Treasury & International Banking as a Trainee Dealer on the Customer Foreign Exchange Desk and is presently a Senior Dealer on the Corporate Sales Desk. Originally from Co. Offaly, Dermot has a keen interest in GAA and plays social golf.

‘Like most others in the market, I underestimated the level of negative sentiment building against the euro, but sentiment has been the primary reason for the euro fall. Even with the improving economic story from Euroland in mid-2000, the euro couldn’t muster a meaningful recovery. But sentiment is very fickle and the euro will recover. The problem is, of course, how low does it get first? And before you ask, I’m not going to hazard a guess.’

‘It may be that the recent US election holds the key to the euro after all. Although the confusion surrounding the vote may not have helped the euro, there is a lack of clarity from the Bush Administration (at time of writing, Bush is favourite) on whether they favour a strong or weak USD policy. The balance of payments is one issue which may hit the USD in early 2001. The markets are currently viewing Bush victory as USD positive, but that could all change in time - see how sentiment changed on the euro.

Bank of Ireland is delighted with our success in the IACT Awards 2000 and, in particular, with retaining the award for Financial Institution of the Year.

The best judges of how we service our customers are those customers. The customer is at the centre of everything we do and we will be striving to achieve further improvements in the services we provide in the year ahead.’

John Beggs, IACT Economist of the year 2000, Chief Economist with AIB Group Treasury

John Beggs won the new IACT awards category of top economist. The economist category was entered to reflect the important of the economist function within the treasury function of the institutions.

‘I was very pleased to have been awarded Economist of the Year, 2000 in what has been, in some respects, an inauspicious year for economic forecasting, particularly in relation to the euro and the Irish rate of inflation. Over the year, optimism that the euro would recover ebbed away to be replaced by a growing sense of pessimism about the prospects that the euro would ever again see parity with the US dollar! With oil prices reaching and sustaining levels not anticipated at the start of 2000 and the euro continuing to slide against the US dollar, the favourable Irish inflation scenario was replaced with a sharp acceleration in the CPI to levels last experienced in the early 1980’s.

On the international front in 2000, we were correct in our view that the US Federal Reserve and the Bank of England’s Monetary Policy Committee would be less hawkish than the market expected on the course of official interest rates. Though the foreign exchange markets continued to focus on the relatively stronger US economy, inflation remained under control and the equity markets began to portend a slowdown in the US economy. This was not sufficient to support the euro. However, having called for intervention, I was pleased to see the ECB enter the market in September. In contrast with the more relaxed approach of the US Fed and the MPC, the ECB turned out to be much more determined than expected to bring official interest rates in the eurozone up to a neutral level as quickly as possible.

Irish economists, myself included, had to focus more on the health of the Irish economy in 2000. Higher inflation, the further rise in house prices and the threat to the PPF brought the majority of Irish economists into conflict with the outside media and external commentators. A view from abroad is very welcome but Irish business was not helped in 2000 by the confusion and uncertainty and, at times, mischievous reports by outside observers. This year, AIB Corporate and Commercial Treasury in conjunction with the economic team launched two new services for our customers. The first was a new quarterly economic focus. This report incorporates research on the international economy, interest rates and exchange rates as well as extensive research on the state of the Irish economy. We also launch a new website, within the framework of FX Centre, johnbeggs.com which provides online access to our research.

Looking to 2001, the big international issue is whether the euro will recover. I expect a modest and slow appreciation to about $0.95 within the next year. I do not expect a hard landing for the US economy and international interest rates are near their peak. They may not fall as fast as expected by the markets. As regards the Irish economy, I remain very optimistic about our growth potential and inflation should decline in the course of 2001. Much of our recent inflation problem is due to the weakness of the euro and high oil prices. These factors should have a more benign influence in 2001.’

Corporate winners
Bank of Ireland won ‘Financial Institution of the year’ for the second consecutive year and also won ‘Corporate Bank’ and ‘Electronic Banking Provider ‘ of the year.

The first runner up in the treasury institution of the year category was AIB. BNP Paribas was the second runner up in this category.

Brian Goggin, chief executive Corporate & Treasury, Bank of Ireland said ‘We are delighted to win these prestigious IACT awards. It also confirms the importance of delivering a tailored customer service based on a comprehensive knowledge of the financial markets and our customers’ requirements. The customer is at the centre of everything that we do and we will be striving to achieve further improvements in the services we provide in the year ahead.’

Bank of Ireland also won the Electronic Banking Provider of the Year, a new category, introduced in recognition of the developments in e-banking. During the year Bank of Ireland introduced Business On Line, a Cash Management and \Payment services for treasurers on the internet, it now has 5000 customers ranging from large corporates to small SMEs.

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