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Asset Liability Management System - New
Asset Liability Management System - New
MANAGEMENT SYSTEM
Presented By SARAS Group
S Shrikant Popat 35
A Amit Pandey 31
R Rohan Sawant 38
A Ashwin Surve 43
S Sahil Wason 49
Assets Liability Management
It is a dynamic process of Planning, Organizing
& Controlling of Assets & Liabilities- their
volumes, mixes, maturities, yields and costs in
order to maintain liquidity and NII.
Significance of ALM
• Volatility
• Product Innovations & Complexities
• Regulatory Environment
• Management Recognition
Purpose & Objective of ALM
• An effective Asset Liability Management Technique
aims to manage the volume, mix, maturity, rate
sensitivity, quality and liquidity of assets and
liabilities as a whole so as to attain a predetermined
acceptable risk/reward ration.
• It is aimed to stabilize short-term profits, long-term
earnings and long-term substance of the bank. The
parameters for stabilizing ALM system are:
1. Net Interest Income (NII)
2. Net Interest Margin (NIM)
3. Economic Equity Ratio
RBI DIRECTIVES
• Issued draft guidelines on 10th Sept’98.