HIGHLIGHTS
Client: Safe Bulkers, Inc.
Business Objectives
- Automate valuations
- Accurately price rates portfolio
- Hedge rates exposures
Requirements
- Solution that integrates easily with existing technology
- Easy-to-use valuation functionality
- Competitively priced
“The FINCAD support team is always very responsive and insightful.”
Constantine Adamopoulos, CFO, Safe Bulkers
Background
With its head office in Monaco, Safe Bulkers, Inc. is an international provider of marine dry bulk transportation services. The company is publicly traded, having listed with the New York Stock Exchange (NYSE) in May 2008.
Challenge
After Safe Bulkers listed with NYSE, it was required to generate quarterly reports showing the market value of its positions. The firm's auditors suggested that the company consider doing valuations with a trusted partner, such as FINCAD. Specifically, the company needed a solution that could help it both accurately price its interest rate derivatives portfolio, and effectively hedge interest rate exposure.
Solution
Safe Bulkers is using FINCAD to hedge rate exposure on loans and generate valuations on a small book of 12 derivatives products. Valuations are carried out quarterly to meet reporting requirements. On an ad-hoc basis, the firm also utilizes FINCAD to validate broker quotes and other counterparties. Relying on the FINCAD support team, and insight from its auditors helped Safe Bulkers get up and running successfully.
Results
Reduced Manual Processes: Using FINCAD has reduced the amount of time spent on performing valuations manually every quarter, giving Safe Bulkers back more time to focus on its core business.
Cost-Effective: “We looked into a couple larger-scale valuation systems, but ultimately they didn’t make sense for us. Many of these systems were too expensive, and had functionality that was above and beyond what we really needed. FINCAD was a good match for our use cases and goals," said Adamopoulos.
Helpful Support: “The FINCAD support team is always very responsive and insightful,” commented, Adamopoulos. “A couple years back I had questions regarding how to generate credit valuation adjustments (CVA) and debit valuation adjustments (DVA) and the FINCAD team immediately prioritized my needs and show me how to run the calculations.”
Reduced Risk:“As a CFO, one concern that ‘keeps me up at night’ is the potential for errors to creep into our valuation numbers and data. Using FINCAD automation gives our firm the confidence that our results are going to be accurate every single time," remarked Adamopoulos.
"Using FINCAD automation gives our firm the confidence that our results are going to be accurate every single time."