Treasury room


The treasury room is the market area of ​​a bank, in which operations related to wholesale or wholesale banking are carried out, offering corporate clients all kinds of financial products from fixed income markets, income variable and forex or currency.

For example, buying and selling of shares, issuance of bonds in the primary market, interest rate or exchange rate hedging, debt structuring, etc.

Components of a treasury room

The treasury room groups four types of figures that work as a large, well-cohesive team within each of the markets that the entity operates, fixed income, equities or currencies:

  • Sales: They are market operators whose mission is to develop relationships with potential and current clients and sell the product that best suits their needs, informing them of the risks of the operation. Its clients are varied: other banks, institutional investors (family offices, managers), corporate clients not related to the financial world, etc.
  • Traders: Its objective is to quote prices and indicate them to sales in each operation, according to market conditions. They also calculate the risks associated with each operation, taking into account movements in exchange rates, interest rates or stocks. Traders spend a lot of time reading reports and reports to understand the direction the market will move in the face of political, economic, geopolitical or other news. They follow an economic calendar for the publication of data (employment, inflation, etc.), central bank meeting calendars, option expirations to see the behavior of volatility, etc.
  • Structuring companies: They design financial products that are adapted to the needs of those clients looking for more personalized solutions. These products are called exotic because they are more complex, as opposed to vanilla or plain vanilla, which are simpler. The structurers usually know in depth legal and accounting issues, since they must structure the operations in accordance with market regulations.
  • Quants: Its mission is to provide data-based intelligence to develop mathematical models and build tools for analyzing and calculating the risk of derivative financial operations and products, which traders feed on. Quants usually have an academic background with a very strong foundation in mathematics, such as their own career in mathematics, engineering, statistics, physics, etc.

The volume of operations and amount varies depending on each entity. The larger the size, the greater volume of operations and more variety than the small ones. Treasury rooms group more people based on the larger size of the bank.

All operators work with platforms such as Bloomberg or Reuters, which allow real-time analysis and monitoring of financial markets around the world and carry out transactions for the sale of financial products electronically. These tools also provide information on a global level in real time, thus competing with traditional media.

Need for Chinese walls

The Chinese walls refer to physical barriers that must exist between the different business units of a bank to avoid leaks of relevant or privileged information that generates conflicts of interest.

The part related to the management and negotiation in securities markets must be separated from the areas of traditional banking and financial services. In turn, within the first group, there must be Chinese walls that separate the areas dedicated to own portfolio management, third-party portfolio management, and market or company analysis.

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