Financial Products & Associated Risk Management

Bank ALM & Treasury Management - Part 2


This eCourse consists of two modules. Module 1 looks at how a bank can use its balance sheet as part of strategic ALM. ALM is the process of controlling some of the many risks faced by financial institutions, particularly commercial banks. As such, the performance of the ALM function is fundamental to a bank's ability to thrive in different economic environments.

Module 2 provides an introduction to some of the tools and techniques used to manage liquidity and interest rate risk. We start by identifying the tools and techniques for assessing liquidity risk, including liquidity gap analysis, liquid asset concentrations, contingency funding plans, stress testing, and liquidity ratios. We then move on to looking at the tools and techniques used to report and manage interest rate risk, including gap analysis, gap limits, duration, earnings at risk, matching, and hedging. Finally, we look at aspects that affect both liquidity and interest rate risk management, including the use of intragroup funding and funds transfer pricing.


On completion of this course, you will be able to:
- Identify strategic ALM and understand the issues and challenges in strategic ALM decisions
- Recognize how balance sheet management forms part of strategic ALM
- Illustrate how strategic ALM may be implemented in practice
- Identify the tools and techniques used to assess liquidity risk
- Identify the tools and techniques used to assess interest rate risk
- Recognize how both liquidity and interest rate risk can be managed


Module 1: ALM – Strategic ALM
Topic 1: Strategic ALM: An Overview
Topic 2: Balance Sheet Management
Topic 3: Strategic Asset Liability Management in Practice

Module 2: ALM – Tools & Techniques
Topic 1: Tools & Techniques for Managing Liquidity Risk
Topic 2: Tools & Techniques for Managing Interest Rate Risk
Topic 3: Other Considerations in Managing Liquidity & Interest Rate Risk


Relevant Subject
SFC:2.50, PWMA:2.50
All Member: HK$765
Staff of Corporate Member: HK$765
Non-Member: HK$1115