Скачать или смотреть How Asset Liability Management Helps in Managing Bank Liquidity and Interest Rate Risks

In this video, we delve into the pivotal role of Asset Liability Management (ALM) in banking, particularly in mitigating liquidity and interest rate risks.

We begin by examining liquidity risk, which arises from potential imbalances between liquid assets and liabilities, exploring how banks forecast cash flows and establish thresholds to ensure adequate liquidity.

Next, we define interest rate risk and its implications for bank profitability, highlighting the impact of fluctuating rates on earnings and loan pricing.

We conclude by discussing the strategic approaches employed by ALM to manage interest rate risk, including gap and duration analysis, as well as the use of hedging instruments like interest rate swaps.

This comprehensive overview provides insights into how effective ALM practices are essential for maintaining financial stability within banks.