Best Practices in Global Bank Risk and

Relationship Management:

How Walmart Tackles Managing Bank

Relationships Worldwide

Presented by

Amiee Stone, Director Global Treasury, Walmart

Troy Baak, Managing Principal, e5 Solutions Group

October 2013

• e5 company profile

• Walmart company profile

• Selecting partner banks – merging business needs with counterparty capabilities

• Evaluating counterparty risk

• Using technology to simplify

• Bank risk and relationship systems review

• Q&A

Agenda

e5 Solutions Group Profile

A recognized leader in solution design, implementation

services and add-on software for ERP Financials and

Treasury Applications, with proven expertise in all areas of

Treasury and Financial Shared Service Centers.

e5 helps companies:

maximize their return on financial investments

reduce risk

streamline critical finance operations

optimize cash management

enhance corporate performance

Track Record

• Nearly 200 Treasury Projects

• 125 Full Lifecycle Implementations

• 125 different companies

• In over 50 different industries

• Covering North, Central and South America;

Europe, Asia, Australia, the Middle East and

Africa.

e5 Solutions Group Profile

Introductions

Our Mission: Saving people money so

they can live better

Company Profile

Walmart U.S. Sam’s Club

Walmart

International

• 59% of total sales,

or $275 billion*

• 4,049 stores

• 12% of total sales, or

$56 billion*

• 620 Clubs

• 29% of total sales, or

$135 billion*

• 6,222 stores

* Sales amounts based on fiscal 2013 reported results

$466 billion total sales

2.2 million associates

10,891 stores/clubs

27 countries

8

Over 7,000 global

bank accounts

Operate in 27

countries

Partner with 36

global banks

Manage ~ 15

currencies

Process $ Billons

of cash per day

Canada

Japan China

India

United States

Mexico

Central America

United Kingdom

Argentina

Brazil

Africa

Chile

~$50B Total debt

$18B Credit

facility

Scope of Global Treasury – Worldwide

Banking Solutions Support our Global

Business

Global Treasury Banking Solutions

Global & Regional Support

We partner with banks to support global business needs

Cash Management

Retail Industry Products

Credit Facilities and

Debt Issuance

Stock Repurchase &

Dividends

Decision Support

9

Investments Trade Financing

Derivative Execution

10

Corporate

Bank

Account

Transporting

cash to/from

stores

Banking Starts with Our Core Business

Deposit Store Cash

EBT Credit & Debit Checks

Counterparty Selection: Three Key Criteria

Ability to meet global and/or

regional needs

Product offerings that

satisfy our business needs

Financial Strength and

Stability

11

12

12 12 12

Monitoring Strength and Stability of Counterparty to Effectively Balance Risk

ST / LT Credit

Ratings

5yr CDS Spread*

Total

Assets

Qualitative Factors

*CDS Spread: Credit Default Swap rate over the treasury rate

Total Scores

Tier 1 Tier 2 Tier 3 Tier 4

Rankings

Measurements

Managing Counterparty Exposure

Measuring Counterparty Exposure

Investments Derivatives

Cash in

Bank

Cash in

Transit

Commodity trading Interest & Currency Swaps

Cash in bank Cash in transit

How We Used Technology in the Past

Central Treasury

Personnel

Emails

Paper Files External Reports

Spreadsheets

Global Reports

How We Use Technology Now

Treasury Workstation & BI Reporting

Bank Administration

Swift Service Bureau

2013: Wave 1 of global treasury

workstation implemented

Global

Treasury

Platform

Treasury

Data from

operational

systems

Bank

data

Corporate Headquarters – Treasury

IHC LP CM

Subsidiary 1

In-House Cash

Cash Management

Transaction Manager

Money

Market Securities Foreign

Exchange Derivatives

Liquidity Planner

IHC LP CM

Subsidiary 2

IHC LP CM

Subsidiary 3

Information Systems

Financial Accounting

Financial Markets

Banks

Analyzers

Credit

Risk Market

Risk

BCM

Debt Commodities

Treasury: Transaction Manager

Debt & Investments Hedging

Money

Market

Securities

Foreign

Exchange

Derivatives

Contract Management

Front Office

Back Office

Accounting

Debt

Commodities

Cash Position Liquidity Forecast

Bank

accounts

Balances

Cash in

transit

Investments,

Debt & Hedging

Operations

Trading

Liquidity Management

Market information

Managing external cash balances and obligations

Multi-Bank simplification and standardization

Drill down functionality

Cash Management

Treasury: Transaction Reporting

Treasury: Transaction Reporting

Treasury: Transaction Reporting

Treasury: Market Risk Analyzer

Features

Control credit risks and

settlement risks

Company-wide limits

Online transaction credit check

Flexible limit creation &

exposure calculation

Exposure

8.5

632.3

728.7

12.3

Limit

10.5

700.7

716.7

4.8

Partner

Euro Bank

NorthAm Bank

Asia Bank

SouthAm Bank

Credit Exposure

In %

19.5%

9.3%

-1.7%

-178%

Free

2.0

68.4

-12.0

-7.5

Credit Risk

Analyzer

Close transaction,

update limits OK Limit-

Check

Transaction Manager

Treasury: Credit Risk Analyzer

Europe

Treasury

Center

Latin America

Treasury

Center

Asia Pacific

Treasury

Center

North America

Treasury

Center

Contact

Mgmt

Bank

Account

Mgmt

(Open/Update

/Close)

eBAM

Document

Mgmt

(Letters, Forms)

Legal

Entities

& G/L

Accounts

Mgmt

Disaster Recovery,

Business Continuity

Planning

Authority

Mgmt

(Signers, D&O,

Execution,

Disbursement)

Bank

Resolution

Repository

Mgmt

Financial

Institutions

Mgmt

(Type, Ratings,

Services, Fees)

Banking Relationship

Metrics/Reporting:

Magnitude, Scope, Leverage

Enhanced Controls:

Authorities,

Service Fees,

Fraud Mitigation

Bank Relationship & Bank Administration Management and Controls Bank Account Administration & Authorities

Bank Relationship Management

Banking Structure & Fees

ROW

Treasury

Center

Bank Administration & Relationship Mgmt.

Questions