Autumn
2006 Training Course/Seminar Series
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How To Deliver Efficient Public Debt Management
4-day intensive residential programme, 12 - 15 September
2006
Venue: King’s College, Cambridge University
Course Chairman: Mike Williams, Independent Consultant and former
Chief Executive of the UK Debt Management Office
Series Adviser: Charles Goodhart, CBE , Professor Emeritus, London School
of Economics, Financial Markets Group
Details of how to register
are here
HOW TO DELIVER EFFICIENT PUBLIC DEBT MANAGEMENT
Burgeoning government deficits and intense competition among issuers mean that efficient public debt management has become crucial to the broad economic strategy of many governments around the world.
Debt management must not only be efficient, professional and sophisticated, but also responsive to market demands. Debt managers need to minimise not only the cost but also the risk of their borrowing in a turbulent world.
For emerging and developing markets, yet another consideration has to be taken into account: financial market development. A well-designed debt strategy is essential for encouraging the development of well-functioning domestic financial markets, which in turn potentially offer benefits of lower cost and lower risk to the debt manager.
This course is designed to help government debt managers confront and reconcile these requirements. It will address several core areas:
Challenges and objectives;
Market development;
Institutional structure and relationships;
Instruments and issuance techniques;
Effective communication.
Expert presenters familiar with cutting edge techniques in debt management in emerging markets as well as in OECD countries will lead discussions in an informal and confidential roundtable format, allowing delegates the maximum opportunity to learn from each other and to discuss their questions and experiences.
This is the eighth year in which Central Banking Publications Ltd has hosted a seminar series in Cambridge. Already, more than 1,000 public sector officials from over 100 countries have benefited from one of these meetings.
Who should attend: government debt managers, finance ministry officials involved in debt management strategies and planning, central bank public debt and market operations personnel.
I look forward to welcoming you to Cambridge.
Yours sincerely,
William Clarke,
CBE, PhD Chairman
Introduction,
and participant challenges and experiences
Mike
Williams
Chairman
Debt managers need to consider what
their strategic objectives should be, beyond simply minimising the cost
and risk of borrowing. The course chairman will introduce the course,
and outline the main challenges facing government debt managers. What
macroeconomic conditions and risks should be factored into debt management
strategies, and how, if at all, do the responsibilities of the debt
office extend beyond just financing public borrowing? The session will
then invite participants to share the main challenges and priorities
facing their organisations, and their own interests and objectives in
attending the course.
Meeting the market’s needs
Henrietta
Podd
Managing Director of International
Bond Origination,
RBC Capital Markets
Debt managers occupy an influential
position in domestic financial markets, and their decisions have important
implications for market competitiveness, stability and development.
This session considers what markets need from debt managers, and how
the impact on markets can be incorporated into a debt strategy.
Allison Holland
Debt Management Adviser, IMF (invited)
The government debt manager benefits from a deep and liquid domestic bond market into which to issue, but it also plays a significant role in developing and supporting the market. This session will focus on how the debt manager can contribute at each stage of market development, from building benchmarks to fine-tuning the issuance mechanisms and the primary market. The speaker will also consider what influence the debt manager might be able to exert over the secondary market.
Group exercise: domestic market development
Participants will be split into groups and asked to consider key features of their own bond market, identify its stage of development and, together with the other group members, propose priorities for action based on lessons learned in the previous session.
Sound practice in debt management
Ian Storkey
Debt Management Consultant (to be confirmed)
There has been considerable debate about what constitutes international best practice for public debt management, but this concept is not entirely relevant, and it may be better to consider the principle of “sound practice”. This session will discuss how this concept can be applied in the context of public debt management, and what constitutes sound practice in each phase of development.
Independence and relationships with other agencies
Baudouin Richard
Director, Belgian Debt Agency
While many countries have set up autonomous debt offices, in others the function remains within the central bank or ministry of finance. This session will look at the implications of where the debt function is located, and under what circumstances the move towards a separate office is desirable. It will also consider the relationships that the debt manager must have with other agencies and how these can be structured.
Issuance
choices and issuance techniques
Hamish Watson
UK Debt Management Office
Effective measurement of debt management performance
Nicholas Sagnes
Head of Operational Research, Agence France Trésor
Benchmarking and performance measurement are necessary to ensure accountability and confirm that debt is being well managed. But are performance measures appropriate and relevant? Do they actually measure what is intended? This session will discuss the construction of performance metrics, the need to be cautious about the assumptions these contain, and how to communicate their results.
The evolving nature of debt management strategy and analysis
Lars Boman
Deputy Head of Portfolio Management, Swedish National Debt
Office
As debt issuance becomes more competitive and debt managers come under pressure to reduce borrowing costs, more active debt management strategies can are needed. The speaker will explain how Sweden’s strategy has recently evolved to become more active, what lessons this might hold for other countries, and how to evaluate the performance and appropriateness of alternative strategies.
Contingent liabilities
Elizabeth Currie
Sovereign Debt Management Advisory Group, World Bank
Debt managers are increasingly being asked to take on, or contribute to, the management of contingent liabilities, a role for which their technical skills appear to make them particularly well qualified. This session will look at the balance sheet issues that arise from contingent liabilities and the prerequisites that must be in place for the debt manager to be able to successfully take them on.
Communicating
with credit rating agencies
David
Heslam
Fitch Ratings
Especially when demand is buoyant, debt managers must avoid the temptation
to see the market for government debt as automatic. Prudent strategy requires
effective marketing and communication on both the national and international
level. This session will look at how debt managers in developed and emerging
markets can raise awareness of their products and communicate more effectively.
In particular, the speaker will discuss the role that credit rating agencies
can play.
Relationships with the private sector
Euan
Harkness
Vice-Chairman, Barclays
Capital; Chairman, Gilt-Edged Market Makers Association
Maintaining good relations with
investors and other counterparties in the private sector is essential
for a successful debt management strategy. The debt manager must be aware
of shifting demand for their products, and must keep the market informed
as to issuance plans. This session, led by the chairman of the body which
represents market-makers in UK government debt, will consider how to manage
such relationships, and how improved consultation with the markets can
make debt management more efficient. The session will also look at what
services private sector firms can provide to the debt manager, and will
discuss where these provide the greatest value.
Specific issues facing emerging markets
Mike
Williams
Chairman
This session will focus specifically on the practical
issues in managing government debt in emerging market economies, and how
policymakers can build a strategy for developing their domestic markets
without running unnecessary risks. The session will also draw some practical
policy conclusions from the presentations and discussions over the preceding
three days. Special attention will be paid to any inquiries or concerns
expressed by delegates that remain outstanding.
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