Professional Documents
Culture Documents
Commercial Banking
Asset Liability Management
April 2008
Pre-Financial Sector Reforms (1991)
• Geographical spread of Bank branches
• Directed Investments / Credit Programs
• Administered Rates of Interest
• Accrual based accounting
• Problems of Recovery of Loans
• Deterioration in Quality of Assets /Loans
• Erosion of Profits
• No Computerisation
• Trade Union Issues
Liabilities Assets
• Various Risks
– Interest Rate Risk
– Liquidity Risk
– Credit Risk
– Contingency Risk
• In terms of:
Maturities and Interest Rates Sensitivities
• To minimize:
Interest Rate Risk and Liquidity Risk
Com Bkg 2008 ALM 2008 13
Asset Liability Management
Asset Liability
Management Management
2. ALM Organisation
3. ALM Process
Management Committee