Two-thirds of U.S. corporate decision-makers have not locked in favorable rates to mitigate their interest rate and foreign exchange exposure, a decision that can cost their firms millions of dollars, according to a survey released today by Citizens Bank. Despite this reality, the survey found that business leaders expect rates to continue to rise and the value of the dollar to fluctuate due to tariffs and other macroeconomic factors.
The Citizens Market Insights Survey of more than 300 corporate leaders finds that 70 percent of U.S. corporate leaders have not locked in lower interest rates despite signs that rates will continue to increase and 67 percent have not used a hedging strategy to mitigate their exposure to fluctuations in the value of the U.S. dollar. Eighty-two percent of corporate leaders, however, say their company plans to take action to keep their business successful in an economy with rising interest rates and 74 percent indicate their company plans to address a potential change in U.S. dollar valuation.
“Foreign exchange and interest rate fluctuations can cost companies significant amounts of money each year so it’s very surprising that more businesses aren’t taking advantage of simple hedging strategies that can help reduce their risk,” said Tony Bedikian, head of global markets at Citizens Bank. “Many banks, including Citizens, offer a range of solutions that help corporate clients mitigate risk so the future becomes more predictable and they don’t have to worry as much about volatility in the markets.”
Citizens is a trusted strategic and financial adviser, consistently delivering clear and objective advice. The Citizens Commercial Banking approach puts clients first by offering great ideas combined with thorough market knowledge and excellent execution to help our clients enhance their business and reach their potential.
For more information, please visit the Citizens Commercial Banking website.
About Citizens Financial Group, Inc.
Citizens Financial Group, Inc. is one of the nation’s oldest and largest financial institutions, with $158.6 billion in assets as of September 30, 2018. Headquartered in Providence, Rhode Island, Citizens offers a broad range of retail and commercial banking products and services to individuals, small businesses, middle-market companies, large corporations and institutions. Citizens helps its customers reach their potential by listening to them and by understanding their needs in order to offer tailored advice, ideas and solutions. In Consumer Banking, Citizens provides an integrated experience that includes mobile and online banking, a 24/7 customer contact center and the convenience of approximately 2,900 ATMs and approximately 1,150 branches in 11 states in the New England, Mid-Atlantic and Midwest regions. Consumer Banking products and services include a full range of banking, lending, savings, wealth management and small business offerings. In Commercial Banking, Citizens offers corporate, institutional and not-for-profit clients a full range of wholesale banking products and services, including lending and deposits, capital markets, treasury services, foreign exchange and interest rate products and asset finance. More information is available at www.citizensbank.com or visit us on Twitter, LinkedIn or Facebook.