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3 Common Credit Deficiencies in Cash Portfolios

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Now well into our 18th year of working with treasury managers across the country, it’s as clear as ever that managing risk remains one of the least understood and most challenging areas of corporate cash management. The treasury landscape is littered with painful examples of write-downs from highly rated securities whose risk was miscalculated, misunderstood, or misrepresented. Corporate treasury functions can certainly improve their effectiveness in this environment through a better understanding of the pitfalls associated with managing credit risk.

With 17+ years of hindsight, we summarize the three most common credit-related deficiencies in today’s corporate cash portfolios: 1) overconfidence in credit ratings; 2) falling victim to non-traditional investments; and 3) insufficiency or misinterpretation of investment policies.

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Best Regards,

Ben Campbell
President & CEO

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