RISK MANAGEMENT
We harness our industry experience, together with a first-class treasury management system, to ensure that all your financial market risks are managed effectively.
Exchange Rate Risk
Our Objective is to contain the impact of exchange rate movements within an acceptable risk profile.
Exchange rate risk management will ensure that exchange rate volatility is managed, and budget and costing rates are achieved.
We use various financial instruments which can be used in stand-alone or structured manner to help in the management of exchange rate risk.
Interest Rate Risk
Our Objective is to contain the impact of interest rate movements within an acceptable risk profile.
Interest rate risk should be managed in terms of a long-term strategy taking into account corresponding liquidity risk (in respect of investments). Fixed and floating ratios should reflect the nature and term of the underlying assets. There are various financial instruments which can be used in stand-alone or structured manner to help in the management of interest rate risk.
Commodity Price Risk
Our Objective is to contain the impact of market price movements in metals, agricultural and other commodities within an acceptable risk profile.
Commodity Risk is normally managed by making use of Financial Futures, which are contracts whereby a commodity’s price can be fixed on a non-delivery basis.
Investment Risk (Surplus Cash)
Our Objective is to manage the risk and ensures the protection of amounts invested while retaining sufficient liquidity to meet financial obligations and generating an optimum return within an acceptable level of risk.
Investment activities arise mainly as a result of the overall funding requirements. Investments should not be managed independently from debt and, as far as possible, should not expose a business to interest rate risk. Funding activities are limited to the debt markets. Therefore, investments should, wherever possible, be confined to these markets.Investments should be made recognising risk in the following order of importance: