Exotic currency transaction

DESCRIPTION:

  • The client wants to purchase an amount of Indian rupees (INR) equivalent to USD 52m to make an acquisition in India.
  • The client has already purchased some INR both spot and forward through a financial institution.
  • Variance performs a retroactive analysis of the executed transactions and identifies extraordinarily high transaction fees (around 1%).
  • Variance follows up the market and provides advice on when to execute the remaining purchases of INR.
  • Variance brings an alternative financial counterparty that offers better conditions and assists the client along the execution of the remaining transactions, providing live market information to control transaction fees.

BENEFITS:

  • Fees on the transactions in which Variance intervened dropped to an average of 0.12% (vs. 1% before).
  • Variance produces USD 300k savings in bank fees, which corresponds to 0.88% of the notional.
  • Variance produces USD 100k additional savings thanks to market follow-up and timing optimization to ensure high liquidity.
  • The client takes advantage of detailed reports that provide visibility on market prices and transaction fees.