Even as corporate bankers pull back lines of credit during the crunch, they continue to lend clients a hand to find new avenues of liquidity.

Chief among these strategies is providing client treasurers more cash flow forecasting tools that give those businesses a better day-to-day (or even hour-to-hour) view of their cash positions. A recent report from Celent finds that leading banks, workstation providers and enterprise resource planning (ERP) providers such as SAP and Oracle are adding or improving their cash forecasting modules to improve everything from account-pooling strategies and data integration to inter-bank communications protocols and trade finance operations.

"Our intent is to create an environment where we can be much more relevant to our client...as they try to more tightly manage their working capital," says Marcus Treacher, who as head of e-commerce global transaction banking at HSBC Bank oversaw the UK bank's September launch of a new client integration tool that combines banking communications with a client's ERP platform for streamlined corporate banking services.

The new system, on the SAP NetWeaver platform, gives corporates single-point access to HSBC's worldwide banking system to simplify accounts payable/receivables and reconciliation - and also integrates more easily into financial supply chains to provide real-time insight into workflows for better capital management. Most companies with ERP systems interconnect with each other, but that seamlessness bogs down as communications enter disparate payments and banking platforms that don't interface, says Treacher.

In a sign of how tough credit has been to come by in the latter half of 2008, consider the uptick of business at supply-chain finance vendor PrimeRevenue. PrimeRevenue handles supplier-initiated receivables for the likes of Bank of America and BMO Capital Markets, giving those financial institutions a transparent view of suppliers' invoicing. With this transparent, real-time view, banks are more willing to extend credit; suppliers, anxious to put lenders at ease in order to tap bridge funding, have been signing up with PrimeRevenue in droves. In the last six months of the year, 300 new suppliers joined PrimeRevenue's SCF platform, with total receivables of $5.8 billion, a jump of 40 percent.

In a statement, PrimeRevenue CEO Joe Juliano says the growth is a "direct consequence of increased strain in the credit markets. Companies tell us they see supply chain finance as a complement to existing working capital facilities, or as an outright replacement to those that have been removed."

As credit dries up, says Jim Daddier, director of ERP Financial Solutions at SAP, businesses "have to do a much more disciplined job of forecasting their liquidity, the timing and the amount of those cash flows, and when they see a situation where those cash flows slow down."

Banks' risk management is benefiting from this push, says Celent senior analyst Enrico Camerinelli. The treasury workstations that banks use to support trade and supply chain finance preserve client stickiness, and "these solutions also allow banks to add the visibility of what the customers are doing."

These liquidity management tools are also crucial for companies making investments with their excess capital. The market fallout and demise of risky strategies has caused a deep retrenchment among treasurers, who now fear potentially career-threatening decisions in their investment choices. Earlier this year, pharmaceutical giant Bristol-Myers axed its corporate treasurer for a securities investment that led to a $275 million charge against earnings.

Most businesses are ill equipped for cash forecasting, as the widespread use of Excel spreadsheet functions limits effective forecasting; the macros and models used can be unwieldy and lack monitoring features that produce a tangible audit trail for understanding how a forecast was reached. Over the next 18 to 24 months, according to Celent, the industry can expect "major transformation improvements" in cash forecasting technology for these liquidity management needs.

"It's been a hot topic for a long time now," says Treacher, "and it's been difficult to crack because the basics of tapping into banks in numerous ways has been a barrier...Regardless of the driver, there will always be great value in getting a really good handle on the financial lifeblood of your business."

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