“The hedging product choice is invaluable” –
Interview with Raleigh International’s Finance Director, Keith Mitchell
Raleigh International is an esteemed charity group. It is 31 years old and counts on over 110 employees. The organisation works with, for, and through young people aimed at inspiring and making positive change in developing country communities.
Raleigh came to Eiger in 2013 for help on their international payments and risk management. Samuel Garnett, head of dealing at Eiger FX, is Raleigh’s main point of contact, supported by the back and middle office teams. Keith Mitchell, Raleigh’s director of finance, is in continual dialogue with Sam over how to proceed with their foreign exchange exposure and risk.
Keith sat down with us for a Q&A to discuss Raleigh International’s foreign exchange strategy and why he chooses Eiger FX.
1. Keith, please tell us a little about Raleigh International and your role
We are a charity organisation with our main operations office in the UK. We work with communities in Nepal; Nicaragua; Tanzania; Malaysian Borneo; and Costa Rica.
Some of the types of project we pursue include improving access to clean water and sanitation services, education regarding the effective use of natural resources, and helping vulnerable communities to become more resilient.
As a charity, we rely on donations, so obviously we need to ensure it is managed well in order to get the funds to where they are needed the most – going toward our projects on the ground. This is what I am tasked with.
My own role is broad, with problem solving as a focus across the organisation. Just to mention a few typical tasks: negotiation of contracts and applications for funding, and ensuring best value for money for the administration services required by the organisation.
2. What are Raleigh’s currency and payment needs?
FX fluctuation is really a top priority for us, as we rely on donations and funding. Coupled with this is the fact that we work with exotic currencies. We have anywhere from $1 million to $3million FX exposure on an annual basis.
Our home currency is sterling. Yes, of course we use US dollar for a lot of our international needs, but the need to use the local currency in each country is unavoidable.
So we are exposed to US dollar, a number of exotic currencies and of course we have to contend with sterling volatility.
We need to keep exchange rate spreads as tight as possible and particularly with the exotic currencies we need to keep fluctuation in check with various hedging products. With exotic currencies, good rates are much more difficult to come by due to less liquidity, and they are much more volatile than the major and minor currencies.
3. Why did you choose Eiger FX for your FX needs?
We chose Eiger for two reasons mainly. One, the access to a diverse range of innovative hedging products. This is essential for us, in hedging against fluctuation, and the products that Eiger offers are not easy to find, especially at such rates. Two, the rates we get on GBP/USD and with the exotic currencies allow us to save substantially compared to elsewhere.
4. What types of transaction do you use mainly?
Forward, spot or anything more sophisticated. Sophisticated transactions involve currency options that have worked well for us in terms of navigating a very uncertain environment for currency prices.
5. What is the most important benefit that Eiger FX brings to Raleigh?
Well with the hedging product suite and the exchange rates, they both essentially come down to cutting costs. With hedging its about keeping volatility in check so we don’t lose our funding in poor FX management. We save and get favourable exchange rates with tight spreads. Oh and I’ll also mention that the service from Sam our dealer and the Eiger team is top notch – always on the ball.
6. Is there anything in particular that you would like to see from Eiger FX in future that would benefit your FX management?
As I said, the innovation in product and the team’s knowledge is a major plus point. Keep that up. Would be good to see ongoing additions or upgrades with as technology advances, to the range of hedging products for exotic currencies.
7. Will there be any changes to your FX exposure in the near future? How will you manage it?
More currencies and more volume, so an even greater emphasis on the need to control exposure to risk and ensure we get sharp pricing. We have plans to operate in other countries, though not in the next 12 months.
We will manage it as we always have – with a keen eye on the FX markets and with the use of a diverse set of hedging products to protect our risk. Sam and his team help us to make the right calls.
8. What would you say to an organisation considering Eiger FX for their currency, risk management and international payment needs?
If you are looking for an experienced FX and payments partner, it’s hard to ignore Eiger. Their range of products is about one of the best I’ve seen and they are always ready and willing to provide advice regarding what product to use and where. Payments are fast – same and next day – and the rates are excellent. From Raleigh International, Eiger come fully recommended.
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