Treasury and Financial Markets

The Treasury and Financial Markets Division is active in six core areas:

Funding

By drawing on the money and capital markets, the Division funds the business activities of IKB, particularly their loan operations. In so doing, it applies a broad mix of products. The annual funding volume in the capital markets comes to approximately EUR 4 billion. Along with large-volume and particularly liquid issues, the bank continues to be committed to providing investors customised tap issues as well. Here especially, the bank's attention is focused not merely on new issues, but also on providing two way prices for those top issues maintaining their market value throughout their term.

Fixed Income

The bank's liquidity holdings - essentially the liable funds and the securities eligible for pledging deposited with the European Central Bank (ECB) for funding operations - are directly managed by the Division. These holdings currently represent a total volume of EUR 2.8 billion. The investment objective is threefold: assuring liquidity, medium-term stabilisation of interest income and the creation of upside price potential.

Asset/liability Management in Loan Operations

The Division is responsible for managing the interest rate and liquidity risk arising from the bank´s lending business. The consciously narrow limits imposed on transactions involving mismatched interest rates reflect the bank's general policy of avoiding interest rate risk. The liquidity requirement is secured in part by a generously measured volume of securities eligible for pledging deposited with the ECB.

Trading for Own Account

The Division's trading activities focus on interest rate products, including derivatives in the euro domain, as well as high-liquidity equities and derivatives in the euro zone. 

Product Development

In support of the bank's operations with it corporate clients, the Division engages in product development for its own investment activities, its own funding-related issues, and on behalf of the bank's Luxembourg units. These products are either derivatives or securities-related derivatives, which frequently contain options and Indizes. Depending on the specific application, they are used for optimising the yield potential of investment strategies, for reducing the costs of funding, or improving the structure of the desired cash flow.

IKB Luxembourg

In close co-operation with our subsidiary and branch office in Luxembourg, the bank offers all forms of financial derivatives suitable for use in financing operations. This way we make sure that our corporate clients are able to benefit from innovative capital market products when putting together their financing packages.

Luxembourg Branch
12, rue Erasme· L-1468 Luxemburg
P.O. Box 771 · L-2017 Luxemburg
Phone 00352 423777-0
Telefax 00352 420603

IKB International
12, rue Erasme· L-1468 Luxemburg
P.O. Box 771 · L-2017 Luxemburg
Telefon 00352 423777-0
Telefax 00352 420603