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Cross border banking: Select a bank

If I work from the following assumptions the bank I choose for my business's bank must offer:

centralized cash management.
local lending sources for operating cash.
short-term investment vehicles for excess cash balances.
foreign exchange and forward market services.
ability to pay in both local and other currencies.
I need to search out the international banks that offer multinational cash management services that combine banking with foreign exchange management. Select one bank and describe how the services it offers will take care of my international working capital management requirements. I need to demonstrate why I believe my choice is the best alternative among the banks I've investigated.

Bank of America, Wachovia, HSBC and any other cross border bank

Solution Preview

Why is operating cash needed? This is typically needed to meet the working capital needs of the company in a foreign location. In other words we need a bank that can provide an immediate line of credit to our branch for meeting their working capital needs.
Please see what tells us:

Lines of credit enable businesses to tap credit for working capital needs at reasonable costs and manage the businesses' cash flow to maximize returns.

The purpose of this facility provided by the bank is to help your company meet its operating cash needs.

Banker's acceptances provide a short term financing source for trade

This will help your business pay bills to pay in both local and other currencies.

· Commercial paper is an attractive financing vehicle for companies with investment grade credit ratings, which require low cost, unsecured financing, as well as selected companies with ratings below investment grade.
We do not know the credit rating of our business so if its ratings are low then commercial paper will help it tide over its working capital requirements especially if funds are required in a foreign country.

Centralized cash management is important so that the head office of your global company can control the finances of your business worldwide. This is important because even though the branches are located all over the world the policies are developed in the home country. Why is Bank of America suitable? It is most suitable because not only its branches are spread all over the world, but it acts as an organic whole and this helps it to implement a ...

Solution Summary

Bank of America is selected and the reason discussed in about two pages.