Financial institutions have exposure to both earnings and market value of capital resulting from changes in interest rates. While this exposure is considered a natural by-product of the banking industry, effective risk management seeks to maintain earnings and value at risk at prudent levels to ensure the safety and soundness of the institution. Managing this risk/return tradeoff has a dramatic effect on profitability and future stability of the institution. Management strategies include maintaining sufficient liquid assets, diversifying funding sources, conducting stress testing and scenario analysis, and closely monitoring interest rate exposures.
Join to learn:
• Earnings at Risk and Economic Value of Equity at Risk (EVE) measurement and reporting.
• Key modeling assumptions for effective risk measurement.
• Incorporating policies and risk tolerance limits.
• Reasonable and relevant interest rate risk scenarios.
• Regulatory expectation of IRR management and Liquidity measures.
• Best practices in IRR management.
Target Audience:
ALCO members, CEOs, CFOs, chief retail, chief risk officer, controllers, funding officers