How to Smash your Next Treasury Interview with Eddie Trahearn

Hello, it's Mike Richards here from the treasury recruitment company. I hope you're enjoying the Treasury Career Corner. If you are great news, perhaps you give us a rating on itunes or wherever you consume your podcast content. This means that even more treasury professionals can benefit from finding out or by finding out about how treasurers have achieved their career goals. The link to rate our show will list at the bottom of our show notes. And please remember as well, the show itself is as much about you as it is about us. There are specific questions you want us to ask or there's feedback you want to give. Please drop me an email. My direct email is mikeresuryrecruitment.com inventibly enough, but anyway, that's enough from me. Let's get on with the show.

Welcome to this week's Treasury Career Corner podcast where I interview treasury professionals about their treasury careers, how they first got started in treasury, where they are now, where they see themselves and the treasury profession going next. In this week's show I'm delighted to be joined by Eddie Trehearn, Director of Treasury at Belmont Green Finance, based in Staines just outside London in Surrey. Belmont Green Finance are a team of experienced mortgage professionals who created Vida Home Loans Residential Buy to Let Mortgage lender which now distributed over a billion pounds of products exclusively via their intermediaries. Eddie's recently come on board to redesign and implement a bank grade compliant treasury function as Belmont Green look to diversify their funding and bring in increased risk management. But just a quick overview for Eddie's background. He's got over 13 years of treasury experience from trading through implementation of bank processes and controls, initially starting back in the day at alliance and Leicester which we'll go through back in those days, the good times of banking, but then through the financial crisis and some challenging times before we do that. And then Eddie moved on Charter Financial Services, lendvest. But that's enough of all that. Let's get Eddie to give you some more of the details. So Eddie, as a regular listeners to the show, you know a little bit more, which is great. Why don't you take us through your story from the dim distant past over to you.

Thanks. So I originally fell into treasury like most people who I spe. So I joined the alliance and Esther Graduate schemes through marketing but quite quickly got fed up of making all the posters that go through your door and wanted to do a presentation on another area of the business. The rest of the graduates, I chose the Treasury. I chose the treasury purely because I thought there would be a safe Full of gold bars. And it so happened that there wasn't. But I never really left, stayed, did a bit of a rotation program.

And then you sort of progress through that role. And how long were you there at alliance and Leicester?

So I was at alliance and Esther for three years, like you said, through the good times to start with, where raising capital, raising liquidity was a piece of cake. I worked across capital markets, money markets, derivatives, asset purchasing, foreign exchange, a range of products, all within the very loose regulatory system at the time. What we then found quite quickly as the financial crisis hit, was that our liability base started to disappear. So we had to think on our feet, think quickly. And I was lucky. I was one of the younger members of the team that didn't have as much riding on it. So I could actually sit back whilst everyone else is going through the process and is absolutely stressed that they may lose their houses. We were keeping nine and a half thousand people in a job we, you know, essentially I could learn so much. And that that phase of that three years of my career is actually sort of completely underpinned everything that I've ever done since.

And when you say underpinned, what is just giving you the broad breadth of experience to rely on or broad depth.

Of experience and actual my approach to risk management. So back then, back in those days, treasury functions, especially in financial services firms, were seen as profit centers and they had to be a profit center. What quite quickly evolved through that was that they were making profit, that you wouldn't make a profit. But what you were there to do was manage the wider risk, financial risk, within the business. And that stuck with me ever since, all through the rapid change in regulatory environment, through the smaller institutions where I've been brought in to implement that in some instances, in the first instance at Wetherby's bank, there was nothing there that wasn't a Treasury. It was old and still is a very strong private bank. But having been the only person that was brought in with any treasury experience, had to drive through a lot of that change, regulatory change, implement the reporting that was required and just prepare different reports for the executive team and ultimately the board.

And then you were up outside of London. The bright lights of London sort of beckoned. You were drawn down. What happened?

Well, unfortunately, there wasn't a lot of bank treasury opportunities around the Midlands. I pretty much exhausted it going through Alliance, Nesta and then Wetherby's in my local vicinity. And the opportunities came up that when they did come up to head up a Treasury function, which I thought I was ready for at that point. We're all based in London.

So you joined Ghana International and then a few different moves within, you know, a relatively short period, but, you know, a couple of different moves. Do you want to just talk us through those?

Yeah. So I didn't set off to move very, very quickly between jobs. I took the head of a Treasury role at Ghana International Bank. It's fascinating institution. It's an offshore bank for the Ghanaian banking sector. It's owned partly by the Ghanaian Central bank, but actually learning a lot about different products again, so learning about trade, finance, really short term commodity deals. Another wide range story of my career is that I've always been open to taking on different products and never wanted to get stuck just looking at the same thing day in, day out. And then from there we put in motion all of the regulatory change again for Ghana and then got headhunted into a bank called B Bank AG Zurich. They were having some issues and they just needed people to modernize what was going on in that institution. So I worked very closely with the CFO and also the sort of the group, because it's a Swiss company. The group risk function just to bring the treasury out of sort of the 1990s and up, right up to date, didn't involve any system implementation there, but it did involve going back through check in, almost doing auditing, liaison with clients again, which is something that hadn't done for a while, doing foreign exchange deals for clients. And I really enjoyed that role. But the CFO left, the bank of England pinched him and the change became a lot harder. There was a lack of communication that we suffered from, which is one of the things that I've always now taken forward is you need that line of communication as the treasurer up into the CFO and also the CEO because there's certain times where there's risks and activities that need to be undertaken that you need sponsorship from both. You can't just do it with the CFOs back in. That's not to say you just go around them every single time, but there is points where you need both in a room.

Yeah, you need a good, good line of communication when you're talking, getting stuff done and things.

That's exactly. Yeah. If you don't, if you're not open and honest. It's one thing that I've taken through my. And I think it probably stems from working in a dealing room to start with. We were quite open to shout and ball and reconcile with a hug and a high five and making good and bad decisions. But what we always had was no air, no underlying or undertones of negativity. At the end of the day everything was cleared, everything was aired and everything. We came in the next day and worked through it again. And that open and honest communication is paramount within Treasury.

And then you made the move to Charter Court. Talk us through because you know, obviously international audience are listening to this as well. So they might not know some of these, some of the banks they might understand but then Charter Court and Invest give us a quick run through of those roles. You sort of.

Charles Court Financial Services was an opportunity that I didn't think I'd ever get again. So they were, I was approached as they were applying for a banking license and they needed an experienced treasurer who understood the regulation, liquidity, market risk, everything else that goes with the bank treasury sector. So I spent a year with them. Initially when we were in the design and build out phase, we submitted our application and we're implementing treasury systems. We were implementing new risk management policies, we were implementing new payment methods, new payment systems, driving through an enormous amount of change. It was a brilliant team effort. Just people were again all pulling in the same direction and we took it from a balance sheet of about £100 million. When I joined to when I left September 17, we had a balance sheet of about 6 billion, 6 and a half billion.

You talk about the team there. How was the team structured when you started or what did you know what you like as a, you know, that's a key thing a lot of people listen to is you want to know what you're like as a boss and how you create your treasury team around you. So what was it like when you first walked in? Sort of January 2014, there was no treasury team.

When I walked in there was a lady that submitted paperwork for the backers to give us funding for the mortgages. By the time I left, we had a Treasury team that stretched across the front office, execution, middle office, treasury operations, ALM and Prudential Risk. The second line of defense. Not all reported into me obviously, but we had a team of close on 25 people.

Yeah.

So I was responsible there for the front office in the air function, liability management and overall I had six people that reported into me and I always go for the premise that I want the best people. I try not to scrimp and save pounds by thinking someone will make do. I want people that I know I can trust that when it all goes wrong they're going to be there for you, they're going to Back you up, they're going to understand the concepts that are coming at them thick and fast.

Yeah. Hiring. Do you mean hiring a higher level perhaps than you might. So instead of recruiting a senior treasury analyst might recruit a Treasury manager or instead of an assistant, you might recruit a deputy treasurer sort of thing.

That's it. What I always find is that actually the long term, the better the people you get in, the less people you need.

Right.

I don't abide by the rules that you just have people and they just sit and they just program on spreadsheets, they become a robot. I want people to be engaged. I try to operate with a pseudo really flat structure. So I'll sit in with my people. I don't like sitting away from them. I want everybody to come to me, from an analyst through to a deputy. I want everyone to come to me if they need me. But hopefully by putting together a high performing team, they should be able to resolve most issues themselves. What I've always tried to do as well is implement the best systems. So you actually get the systems to do the grunt work and you have highly skilled people that can think strategically and make very good risk management decisions.

And you work yourself out of a job in a way, in a good way, you know, because as you say, they're taking on the responsibility whilst you, you know, take it forward.

So I think, well, you, I think that the key to being a good treasurer is being able to act as that sponge between the board and the executives and the rest of the team. You know, in my experience, boards can be up and down in their behaviors, but I don't find that treasury teams necessarily respond that well to being shouted at.

Yeah.

So you sometimes have to take the, you have to take the roof from above and then it just looks smooth and a nice easy transition and message spread into the rest of the team.

Yeah. And then, you know, you're nearly four years at chartercore before you made a move. You know why, you know why move on from there. Very successful, you know, head of treasury, really enjoying it. Great team. You know, what happened next?

The, the change of stocks. We've just been through an IPO process, so the treasury doesn't take a back seat in that instance. But we weren't looking to do anything new because we needed to be stable, we need to manage the risks within corridors. So we had full time jobs doing that. And the attitude in a way became a bit stuck in that they didn't then want to push on and do some of the other things that, you know, I thought at that point needed to be done.

Yeah.

I'd also always had a burning desire to move and try a corporate non bank environment.

Yeah.

And the opportunity came up at Lend Invest and I took it. Well, I was fortunate enough to get it and then, and then took it.

And Lend Invest explain again.

You know, so Lend Invest is very interesting. It's a fintech company and prop tech company. So it's a mortgage lending platform where it's not peer to peer. It's where borrowers and investors have a ability to match funds against each other, although it's within a fund structure on the platform. They also have more traditional funding lines given through banks. What they're developing is a very clever technological platform that allows them to intermediate the market in a different way, the lending market, mortgage lending market in a different way. But when I joined it became apparent they'd done close enough to a billion pounds of lending as well, but through no centralized treasury function. So they needed someone to come in, have a look what was there which wasn't as easy as it as it sounds and then form a Treasury function and then pull the bits that are being done elsewhere in the organization to centralise a lot of the tasks and that range from actually hedging deals or hedging the lending that's going on through an interest rate risk perspective to funding payments and getting a structured method, putting in loans and as they're going out the door in certain timescales, et cetera, SLAs for the rest of the business. So it was interesting. I enjoyed my time there. I wasn't there that long but it was a period where we got a new cfo. We started to build out a lot more technology in terms of where loans are sitting and recording which funding line is owning loans and moving a lot more away from Excel into systems based approach. And you know I did enjoy it. It's just that the opportunity at Belmont Green came along and it appealed to me a lot more. I've learned a lot of lessons helping Charles Court set up their bank and I wanted to apply them again and try to avoid the mistakes we made the first time around.

So tell again explain to you know Belmont. Someone walks in, you look up some of the stuff on the web and everything else but explain in your words.

Belmont Greener, a mortgage lender, a specialist mortgage lender. So we lend into the buy to let in the owner occupied sector. But it's people that won't pass necessary straight through on a high street lenders criteria. So it needs a Bit more of a manual underwriting. People need to look at it, need to understand cases better. So instead of a computer says no environment, we have people looking at cases and making an informed credit decision in line with the credit policies that we've got in place. At the moment we're funded by the wholesale markets, so we're a non bank lender. And then within the, hopefully within the future we will be moving to a more diversified funding base, hopefully across deposits, hopefully wholesale funding and any other access and channels that we can find where we can raise again specialist liabilities that we can deploy into more specialist areas of lending.

And what's it like going in? You've obviously enjoyed this niche banking startup sector. What is it that obviously buzz, you must get out of it or, you know, more why bother again? You know, you're doing it again, you know, coming in and it's brand new, it's fresh, you know, do you just, you know, is that the thing for you or what?

Yeah, well, I won't lie, it's going to be brutal again, but I quite enjoy that it is. You can see you're making differences nearly every single day. You don't have any data the same, you get to find talent, you get to employ talent and you get to build that talent. And I think some of the positives that I've taken from my career is whenever I've moved on, the majority of my team have always wanted to come with me or follow me. And I like that, I like that sense of camaraderie that you can get in a smaller institution. But you also have to accept the rough with the smooth. You can't hide as much in a smaller institution as well. So you get back what you put in and if you can implement something very sensibly, you can bring boards, execs up the learning curve to the right level. Then you get, you get the pats on the back and everyone every now and again likes to get at least one pat on the back. That's the nature of the beast within, especially the small bank or small institution, corporate startup, treasury environment.

And you say, you talk there about recruitment, obviously, as you hear before that you're on the podcast hosted by the treasury recruitment company. What's your ethos around? What are you looking for when you recruit? You know, where are you looking? Is it right, you know, I've got a cv, it's right, the qualifier qualifications number one or what have they done? Or what are the different, you know, things that jump out at you?

I may sound a little Bit out of order here, but I don't put much stop by qualifications. I find in the startup environment the qualifications can actually hinder your thinking process because it feels sometimes like they become very blinkered in their approach, that it has to be like the textbook said, that's not true, that's not how it works out sometimes. And sometimes you might find that you have to do something outside of your remit in a startup. Yeah, yeah, I. Generally you have to review the cv. There has to be the relevant skills in there. But what I enjoy more or find more stock by, especially in the startup area, is their personality. Can they handle the change? Because you can have someone that is brilliant on a cv, they can do absolutely everything. You could put them into somewhere where they can't just get the data delivered to them and they just put it into a spreadsheet and then they can compute it, but they actually have to go out, find the data, speak to the right person in the institution, get their own report built before they can even get to the part calculating it in the spreadsheet. They just melt all away.

Without giving too much, without giving me too many interview tips, how do you assess that? You know, from someone's, you know, okay, you've got the cv, you got them in front of you, but what are you using it, you know, are you then just having conversations with them or their. What evidence are you basing on? What sort of, you know, how do you go through? Is it out over a coffee or how do you do it?

Exactly that. I prefer not to do a formal interview in the first instance, but more of a sit around the table and have a chat. Our office is in the shard, so we are quite lucky to have a nice vista to sit and it sort of relaxes people a bit.

And the most expensive coffee.

For someone. Yeah, we, what we actually, you know, what I actually do is take them through, just see how would you do this. So have you ever thought about this sort of thing before and have you had questions that you ask on about how do you calculate interest rate risk, how have you calculated liquidity before? It's more around. Have you ever had trouble getting your data for your reports? And let the person talk me through it and you again, this is just my opinion, but I think you can form that view quite quickly and I think in a small team, in a larger team you can take the skill set. You don't necessarily all have to get on. In a smaller team, personality is key because if you don't all get on, it becomes Incredibly difficult to get anything done.

But also that interviewing style is more evidence based, slash scenario based. You know, interviewing as we, we called it, where you're actually, you know, it's taking it further on from, you know, tell us about how you've dealt with a difficult person. It's like, right, you dealt with a difficult person, but what happened next or then how did you deal with it sort of thing is that much, you know, it's actually, you know, the reaction and you know, as you say, and if you're doing in a more informal sense, although it's not informal for those of you out there, you know, guys, it is an interview. Do you remember that? But actually it sounds like you can then get that much more so from the people as well.

You know, I always think people have hours and hours and hours to write their cv.

Yeah.

And they're going to give you the most perfect view of them ever. If you can get people thinking off the cook in your first 20 minutes of chatting to them, you actually get to see how they behave in a changing environment. Can they actually cope with randomness? Can they cope with not interrogation style questioning but rapid questioning, which all of which you are going to get in the environments that I've worked in for the last eight, nine years.

Yeah. And if you look back over your perfect cv, Eddie, and just doing that, you know, just putting that turning around 180, you know, what things would you have changed or you know, not necessarily what mistakes, but what sort of things. Okay, I love doing that. Or, you know, if I was recommending that someone walks in and say, I'd like to be, follow your career path, you know, they're very junior or something like that. What recommendations would you give to those guys?

I'm not one for believing in having regrets. Everything I did, I've always chosen on almost gut feel for the roles that I've taken. Not all of them have worked out. You know, Habibank probably wasn't the best one for me. But that wasn't to do with the bank. It was just an individual feel. Yeah.

I have a person.

Yeah. But what I did, I've always done is gone into everything with my eyes open and sometimes opportunities have arisen where other people will go. I don't think that that's really right right now. So for instance, I joined Charter Court when I had two really small kids and that was a business that could either flourish or potentially go. So it was, you know, it was probably a risk, but at the same time I felt it was a Risk that was worth taking for the progression of my career and it was interesting work. I think as long as you find the work interesting, you'll enjoy going to work. If you enjoy going to work, that generally means the business is going to succeed.

And you talk there about, you know, sort of, you talked earlier rather about sort of systems and you see the, the industry developing. What are you seeing, you know where you know there's a lot of stuff coming at you guys and I'm aborted talking at various conferences about, you know, AI and automation. Yeah, that's always going to take out routine. We know this. All right, get over it. It's more. What are you seeing sort of coming down the line that's going to help yourself as a treasurer or you know what, what are you thinking about for the future as you progress?

Well, I'm going to sound a bit like Philistine, but I'm not all sold on AI yet.

That's treasury.

But I think there's machine learning will help. So cash flow planning, clearly there's going to be an element that it can start to help. There's risk management. We've already got systems out there that can calculate and then essentially tell you what hedging to put in place. There are plenty of very systems now for comparisons on FX prices, bond prices, whatever it may be, whatever products we're working with within the treasury and it may just be in my smaller institution world, but that actual FaceTime catching up time, going for lunch, going for dinner with brokers, some of the investment banks, some of the other lawyers and people that are in the wider treasury family. Without that and that little insight, those little bits of knowledge that you're not picking up elsewhere your wider network. So staying in contact with ex colleagues, always managing to keep up time for meeting the people that you used to deal with, that sort of thing. I think sometimes treasurers can be a CFO's worst nightmare if they're very analytics driven and they have to have everything on a spreadsheet because I'm a firm believer that 75% of what we do is in science, but then the 25% is an art and that's just a gut feel. Sometimes it's like you can see the macroecon economic situation is looking like a certain way and rate should move a certain way, but you sometimes just get a sense that actually I don't think it's going to play out like that. And you might take a contrarian view to the market but your AI, unless you can program it to Be that clever and have got feel, then I don't think that's where I still think there is a human element to treasury that will always be there.

Trust your instincts and your gut sort of thing.

Yeah.

So someone, you know, to sort of wrap up today and just, you know, look to the future again. Someone looks back at your sort of your LinkedIn profile and that's one of the things we would say is to, you know, connect with Eddie. I checked with him before the show that it's a good way to connect, you know, look at his background and stuff like that. We'll put the link on the show notes as well. But if someone does look over your career and they say, actually that's what I want to do, what advice are you going to give to that person or to people out there? What are your overall thoughts?

I think it's a good question. I think overall, my career, again, like I said, I fell into treasury and I've never shut any door. If someone's given me an opportunity to learn, I'll grasp it with both hands. And through doing that you get a reputation for being able to handle change, being solid, being dependable and being able to deliver the results that people want to see. Some of the processes I've had to take institutions through have been pretty complex and I've not had a huge amount of support throughout the institution because there's not been that understanding. So there's the two elements you're actually implementing and bringing people along. And I think if you can be very much a people person, I think I said it earlier, I'd rather always be employing people who are far more skilled than I am in their specialist areas than having to be the most knowledgeable person about every single thing in my treasury. I think the treasury is definitely one of the areas where the sum is greater than the parts and if you get the parts right, then you can deliver great function, a very efficient function, a function that people actually within the rest of the organization don't mind doing business with because essentially we are. Wherever you work, you are always probably the gatekeeper to the players. And, you know, I've built my career on trying to have. Yes. As my first instinct to a question, and I'll only ever turn it down if I find there's no avenue for me to manage the risk.

Amazing. Well, great little wrap up to today's show. All it remains for me to do is say, thank you, Eddie, for being a guest and a regular listener. It's much appreciated. I hope you're enjoying it. You know, thanks for your time today, and I look forward to thanking you over a beer in the future.

Yeah, perfect. Thanks, Mike.

Thanks very much.