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Citibank to manage the $110m spent by NZ diplomatic posts annually

Citibank has won a five-year global banking contract to handle the $110 million spent by New Zealand's diplomatic posts each year.

The successful tender was announced on the Government Electronic Tenders Service website. The Ministry of Foreign Affairs and Trade first advertised the contract last year with the aim of cutting its international banking costs and outsourcing payroll services at its overseas posts.

It wanted to consolidate 73 bank accounts with 34 banks in 38 currencies and across 48 countries into one banking relationship, the original tender documents say.

Foreign posts generate 42,000 banking transactions a year, with a third of those valued at less than $250. A lack of automation means it uses significant staff time while head office cannot accurately assess its true costs, the documents say.

MFAT also wants more control over foreign exchange contracts. The ministry spends an annual $325 million in foreign currency, including its aid programmes.


Comments and questions

Depending on what sort of transaction and where, they should be trying to use credit cards as then you only pay the bill and to the accounting monthly. I've worked in public sector organisations where we've saved significant transaction costs by issuing credit cards - sometimes with reasonably high limits for purchasing regular items without problem