International

Foreign exchange risk management

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When doing business overseas, we believe it's important to protect profits from the risks that come with fluctuating foreign exchange rates.

Could be suitable for you if:

  • Your business imports or exports goods and services
  • You own overseas assets, joint ventures or partnerships
  • You have group companies and subsidiaries in more than one country

Foreign exchange risk explained

The most common causes of foreign exchange risk are:

  • making overseas payments for your imports that are priced in a foreign currency
  • receiving foreign currency for your exports.

For example, if you plan to import $100,000 worth of stock from a supplier in the Far East in three months' time. If you simply wait and buy your US dollars in three months when you need to make payment, you have no idea how much that stock will cost you in sterling because of FX fluctuations.

Failing to protect against movements in foreign exchange rates effectively means buying or selling without having agreed a price in sterling.

Other causes of foreign exchange risk are:

  • foreign currency borrowing or deposits
  • overseas subsidiaries
  • assets located overseas.

How we can help to manage your foreign exchange risk

Our specialist Global Markets team will work with you to develop a four-point plan to help minimise your foreign exchange risk and protect your profitability.

  • Understand your exposures
  • Understand the solutions
  • Develop a strategy
  • Implement your plan

Important information

Read about our four-point plan in more detail

Speak to your local Relationship Manager

Call us on

0800 731 8932

Lines are open from 9am to 5pm, Monday to Friday excluding public holidays
Textphone: 08457 125 563

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