Asset and Liability Management for Banks

Course overview

Bank profitability and survival depend on how well the balance sheet is managed. Mismatches between assets and liabilities expose banks to interest rate and liquidity shocks, as recent rate cycles in the region have shown. This asset liability management course gives treasury, finance and risk staff the tools to measure these risks and manage the balance sheet strategically.

Participants study the purpose and governance of asset liability management, the role and agenda of the asset and liability committee, and the regulatory requirements for interest rate and liquidity risk. They learn to measure interest rate risk through repricing gaps, earnings sensitivity and economic value of equity, and liquidity risk through maturity ladders, liquidity ratios, stress testing and contingency funding plans. The course also covers funds transfer pricing, balance sheet planning, hedging options available in regional markets and how capital interacts with ALM. Practical work uses a model bank balance sheet in Excel.

Participants leave able to measure balance sheet risks, support ALCO decisions and contribute to strategic balance sheet management.

What you will be able to do

• Explain the objectives and governance of asset liability management
• Measure interest rate risk using gap, earnings and economic value approaches
• Measure and stress-test liquidity risk
• Design a contingency funding plan
• Apply funds transfer pricing to allocate costs and returns
• Prepare analysis that supports ALCO decisions

Who should attend

For treasury, finance, risk and ALCO support staff in banks, microfinance banks and SACCOs. Familiarity with bank financial statements is expected.

• Treasury officers
• Asset and liability managers
• Risk managers
• Finance and planning staff in banks
• ALCO members and secretaries
• Bank supervisors
• Microfinance and SACCO finance managers

Course outline

Fees are per participant in US dollars and cover tuition, course materials and your certificate. Travel and accommodation are not included.