Capital Liquidity Account | Further Information

The Capital Liquidity Account is an offshore cash-only investment account managed by the Treasury Services team

When clients enquire for more information about the Capital Liquidity Account, the key areas they enquire about are risk management, asset allocation and reporting

Risk Management

In order to generate the high yields payable to CLA portfolio holders, the underlying treasury pool is managed utilising a diversified range of high quality bank and building society deposits but with a clear focus on managing three areas of risk:

  • We manage Credit Risk through a list of approved banks and building societies. Every issuer on the list is monitored on an on-going basis by our experienced team.
  • We manage Liquidity Risk by limiting the CLA’s underlying cash assets weighted average final maturity and adjusting those cash assets to better match the CLA investment profile.
  • We manage Interest Rate Risk by monitoring the forward yield curve and limiting the CLA’s weighted average maturity.

Asset Allocation

The asset allocation strategy is to invest in cash deposits held with high quality domestic and international banks and building societies, rated single-A to AAA, A1+ or A1 by rating agency Standard & Poor’s. The strategy is to maintain asset quality/diversity of the portfolio in accordance with the Treasury Services team’s quality guidelines:

  • Income Potential – Low to Medium*
  • Volatility / Risk Level – Very Low
  • Investment Time Frame – No minimum

* This is subject to change due to changes in base rates