REDUCING 'COST OF CAPITAL' AND 'COST OF RISK TRANSFER'

With its BestFinance and BestHedge concepts and tools Maravon supports Treasurers and risk managers to fund and protect their companies with the most appropriate instruments and lowest cost of funding and risk transfer.

BestFinance is Maravon's approach to shape the optimal portfolio of external financings for a company and a group of companies. Future cash flows are uncertain and most debt financing instruments require a definite interest and repayment schedule. We help select the most adequate capital sources to obtain the best balance between low financing cost, high repayment flexibility, cash availability and covenants compliance. In case capital was raised before the management decided on the use and allocation of such capital, we assist Treasurers and risk managers to synthetically or physically re-shape the financing portfolio towards a structure that possesses only a minimum of asset-liability mismatches, thus reducing interest rate and spread risks. In capital markets transactions we guide our clients through debt issues and IPOs.

BestHedge is a methodology that reveals direct (e.g. premiums and fees) and indirect (e.g. unfairly set strikes and barriers) cost components in hedging instruments and exposes those bankers who make hedge recommendations irrespective of the knowledge of the company’s exact risk exposure and therefore often against the companies’ interests. BestHedge defines the IAS 39 compliant-metric ‘hedge performance’ which evaluates the adequacy of hedge solutions on foreign exchange, interest rate, inflation, credit and commodity price risk in relation to the price for risk reduction. BestHedge ranks the offered hedging alternatives according to the hedge performance and displays the relatively best solution both numerically and visually.