Case Study: McDonald's achieves more effective interest rate and FX hedging with FINCAD Analytics

Increasing the Effectiveness of Hedging Interest Rate and Foreign Exchange Risks

McDonald’s, the global food-service retailer with nearly 29,000 restaurants and more than 65% of revenue generated internationally, faced growing interest rate and foreign exchange exposure—more than $8 billion in debt with over half denominated in foreign currencies. Treasury’s Financial Markets group needed a cost‑effective, consistent way to price and manage complex derivatives and improve hedge effectiveness across interest rate and FX risks. To meet this challenge they selected FINCAD and its Microsoft Excel–based FINCAD Analytics Suite for Excel as their pricing and valuation platform.

FINCAD delivered an Excel-integrated solution that lets McDonald’s price exotic currency options (basket, average-rate, double-average-rate), swaps and swaptions, run simulations, and link templates to live Reuters and Bloomberg feeds for real-time mark‑to‑market. The FINCAD Analytics implementation reduced the learning curve by handling FX and rates in one environment, enabled more cost-effective basket hedges (lower premiums vs. separate options), and produced real‑time valuations and improved hedge effectiveness; FINCAD’s responsive support also proactively added option functionality to meet McDonald’s needs.

McDonald's

Brian Moore

Manager of Financial Market