Transforming liquidity management at Manulife
How Manulife Hong Kong consolidated fragmented funds, automated multi‑bank sweepings and generated investment income.
Overall Winner
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The original article was published by Treasury Today at treasurytoday.com
Manulife (International) Limited is the Hong Kong and Macau arm of the Canadian-headquartered Manulife Financial Corporation, a global financial services group specialising in insurance and wealth management.
The challenge
Manulife Hong Kong needed a streamlined approach to optimise operating liquidity, minimise idle funds and enhance cash yields. The financial services group was also stymied by manual processes which made consolidating operating funds, scattered across multiple banks, challenging and led to inefficient cash deployment and delayed investments.
The solution
Working in partnership with Standard Chartered and Citibank (Citi), Manulife Asia Regional Treasury, Asia Investment and Manulife Hong Kong, created a new liquidity management structure to manage fragmented operating funds and optimise liquidity. The cash concentration structure consolidates funds into Standard Chartered accounts via automated fund transfers for daily payment obligations through on-demand sweeps. It also supports timely investments in money market funds.
The implementation began with identifying the need for enhanced liquidity management and culminated in the launch of the new structure that has allowed Manulife to reduce its operating cash by over 40 per cent and generate an expected USD15 million+ annually in incremental investment income.
Moreover, although the solution was implemented in Hong Kong, it is scalable and has the potential to be rolled out across other markets where Manulife operates.
By using advanced banking technology, including multi‑bank sweepings for automated fund transfers, the Bank and Citi facilitated an end-to-end automated process ensuring timely fund settlement with the fund providers. The structure also includes a regional interest optimisation feature, allowing better cash yield through notional aggregation of balances across Asia.
The implementation of this structure has provided Manulife Hong Kong with enhanced visibility of its total operating funds, reduced manual oversight and improved operational efficiency. It showcases a replicable model for other insurers facing similar challenges in liquidity management, emphasising the importance of strategic banking partnerships and technological innovation.
Best practice and innovation
The solution exemplifies best practices and innovation in liquidity management by streamlining operations and optimising liquidity. The innovative approach also leverages automation through multi-bank sweepings for fund transfers, ensuring timely settlements and reducing manual intervention. The integration of a regional interest optimisation feature further maximises cash yields by aggregating balances across Asia for preferential interest rates.
The structure not only reduces operating cash but also enhances visibility and control over funds, allowing Manulife Hong Kong to deploy surplus cash efficiently for long-term portfolio investments. This model showcases Manulife treasury teams’ value-driven treasury solutions addressing specific operational needs while providing scalable and replicable options for other insurers.
By focusing on efficiency, visibility and operational control, this solution sets a benchmark for best practices in treasury management, reinforcing the importance of technology‑driven solutions in achieving financial optimisation and strategic growth.
Key benefits
- Cost savings.
- Process efficiencies.
- Return on investment (ROI).
- Increased automation.
- Improved visibility.
- Manual intervention reduced.
- Increased system connectivity.
- Future-proof solution.
- Improved key performance indicator (KPI) metrics.
The impact of the new facility on the business has been substantial. Not only has it optimised Manulife Hong Kong’s financial operations, it has also set a benchmark for best practices in the industry. It underscores the potential for banks and businesses to work together, leveraging technology to drive impactful changes that benefit all stakeholders involved. This solution exemplifies how thoughtful innovation, guided by clear business needs and executed by dedicated professionals, can achieve remarkable results.
Standard Chartered is one of Manulife’s key banking partners in Asia, enabling its strategic initiative to establish a liquidity management structure to achieve cash concentration and enhanced visibility for operating funds in Hong Kong.
Mahesh KiniGlobal Head, Cash Management, Standard Chartered
“This has enabled us to automate fund transfers through on-demand sweeps to their payment bank to support day-to-day business obligations, and we are proud of the outcome that maximises surplus funds effectively,” says Mahesh.
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