International Air Transport Association
The newsletter for Airline Treasuries - March 2013 Edition


I am very pleased to launch our revamped newsletter Currency Matters, a publication targeted to Airline Treasury and Financial officers worldwide.

The original Newsletter started as a link for our ICCS (IATA Currency Clearance Service) members. Now the service reaches over 300 airlines and with a growing Airline Treasury community we want to offer you a publication of choice for airline treasury information and sharing of best practice.

Our ICCS platform is the global link to help you manage your cash flows and currencies Worldwide, but it is only one of the many tools offered by IATA to serve you.

We are now embarking on more ambitious initiatives within IATA Financial to extend our services, such as the Airline Treasury Dashboard, I strongly believe that it became essential to offer a new tool to share, receive information and make your voices heard in order to shape the future of your IATA services.

Happy reading,

With my best regards,
Arnaud Francq
Director, Industry Payment Services
IATA Financial
In the news

3 new airlines joined ICCS in January and February 2013: Inselair Aruba, Germania and European Air Transport Click to view full list of members

ICCS is now available in Central Africa in BSPs Cameroon, Gabon, Central African Republic, Congo, Equatorial Guinea and Chad! Use our services to repatriate your BSP sales from these markets, without the need of holding a local bank account. Click to view full list of countries
ICCS has a new report delivery option: Citidirect AFRD. This new option will allow ICCS members to receive ICCS Cycle Reports (30A & 30F) by secure email. The set-up must be coordinated by ICCS and the airline, contact us for more details and on how to request this set-up. Click to view requirements
IATA Financial launches a new service: RevAssure
Revenue leakage and card fraud must be managed as one interconnected process. IATA RevAssure, in partnership with Sutherland Global Services (SGS), focuses on specific areas known to reduce revenue: less than optimum card fraud prevention, weak chargeback management and poor reconciliation of accounts. IATA RevAssure delivers a proven methodology and tailors solutions to work in your environment. Click to view more details on this new service!
Airline corner   Market corner

Delta Air Lines News


Congratulations to Kenneth Morge, Delta’s new VP & Treasurer!

Lufthansa’s insight on Global Bank fees management with TWIST

Many Corporations do not know with any degree of accuracy what is being paid to international banks for their services.

• There is often no way of accurately verifying international bank fees

• Analysis of bank fees is labor intensive

• No way to provide management with global bank relationship metrics

• International cash management fees are decentralized with few controls in place

• Compliance issues

That is why Lufthansa convinced its major banks to provide electronic invoices for more and more countries.

Link to a report on Twist:

And the link to TWIST itself:

Insight from Citi

For airlines engaged in hedging activities, there should be considerable interest in a new set of rules impacting banks on a global scale known as Basel III.  Basel III makes significant changes to the counterparty credit risk (CCR) framework, intended to require increased regulatory capital support for banks entering into uncollateralized derivative transactions with counterparties.

Under Basel II, credit charges are applied on derivative transactions based on the bank’s potential credit exposure if its counterparty defaulted.   Basel III introduces a new credit value adjustment (CVA) add-on,or variability charge,that is not based on potential defaults, but is based on the potential deterioration of creditworthiness of its counterparties.

New capital rules will generally have minimal impact on pricing for short tenor swaps but will have a significant pricing impact for swaps with longer tenors and for low-rated counterparties.  Depending on the circumstances, the charges could be significantly higher than what most banks are currently charging.   In the face of these new charges, many corporations are likely to consider entering into bilateral margining agreements with their banks or simply clearing their derivative transactions through clearing houses.

Originally scheduled to become effective on a transitional basis beginning in 2013, current estimates suggest Basel III implementation will be delayed until at least 2014 in major jurisdictions such as the US and EU. Recent reports suggest European banks may be granted an exemption from a portion of the capital requirement for derivative trades, the CVA volatility charge, for trades with corporates, pension funds and sovereigns. If the exemption appears in Europe's final Basel III rules, it will create a divide with other jurisdictions where final rules incorporate a blanket CVA charge, such as Australia, China, Japan, Singapore and Switzerland. No CVA exemption appears in Basel III proposals in the US.

Matthew N. Daniel
Corporate Solutions Group
Citigroup Foreign Exchange | +1-212-723-6855

Insight on ICCS
FAQs   Know your service   Tip of the month
Can I designate the value date of a payment?
How can I implement ICCS in a specific country?
How is the ICCS Calendar generated?
ICCS offers flexibility and transparency; discover all the options available to you!. Link to ICCS presentation PDF version
Did you know you can coordinate with your GSSA and have the CASS sales settled through ICCS even for indirect participation? Contact me for more information
  Check your 30A and know in advance what to expect in your bank account! See what a 30A shows.
Currency coordination news
RFB (Remittance of Foreign Balances Survey for 2012 was launched in January and closed March 15th). RFB Report is being finalized and will be sent to all the survey respondents very soon!
Treasury Day: ICWG first meeting for 2013 combined with SWIFT discussion and Treasury Dashboard working session will take place April 23rd 2013 in IATA Geneva offices. If you are interested to attend contact me. (

Main Highlights of February:

The Venezuelan government announced the devaluation of their currency, VEF, at a press conference, February the 8th. A devaluation of the official rate of the Bolivar from 4.30 to 6.30 Bolivar per USD. IATA immediately sent an official letter to the Vice-President of Venezuela and held a meeting with the Central Bank on February 14th.

The Central Bank Governor confirmed to IATA and published in the Official Gazette #40108, (Article 9, paragraph); that all airline company’s currency requests made to CADIVI before February 8, 2013 will be approved at the pre-devaluation exchange rate of VEF 4.30. This is very good news for our industry as this was not extended to many industries.

Since December 30th 2012, the Central Bank of Egypt has been holding auctions of foreign currency as a part of new exchange system where all foreign currency in Egypt are currently sourced through the Central Bank of Egypt's 'auction mechanism',  which is subject to availability of hard currency. Airlines have been experiencing some delays in their repatriations.

The Malawian Kwacha currency value keeps dropping as the foreign reserves of Malawi decline. The MWK is at its lowest in a decade with a value of 356.228 per USD on February 22nd.

The currency has been on a downwards spiral ever since it’s devaluation of almost 40% due to the change of the currency and rate policies instituting the floating of the Malawian Kwacha effective March 7th 2012.

For suggestions or comments for future editions please contact:

Lamyaa Khattabi,
Manager, Industry Cash Management Services
IATA Financial


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