Ensure that your ALCO has the right information at its disposal and a process in place so that it can most effectively manage your bank’s balance sheet.
Model validations should be so much more than a simple regulatory compliance checklist. An ALM process can be fully compliant with all of the regulatory guidance—yet not provide ALCO with the best information upon which to develop key balance sheet strategies.
DCG’s ALM Model Validation process goes well beyond a regulatory compliance review to ensure your ALCO has the right information to facilitate strategic decision making. Our team of experts has experience in validating every ALM model on the market today.
It is important to understand that a risk measurement model is just the means to an end. The true value in any interest rate risk (IRR) modeling process is found in the quality of the data inputs, the scenarios and time horizon selected to analyze the profile and, most importantly, the development and support of bank-specific model assumptions.
Our suite of ALM Model Validation services provides your ALCO with the guidance and support to develop a complete ALM process that incorporates IRR modeling and reporting, liquidity risk management and contingency planning by implementing a decision-making framework.
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DCG provides the most thorough ALM model validation that goes far beyond a “regulatory compliance review.” No stone is left unturned as our consultants understand every aspect of your IRR modeling process. Our recommendations are founded from two distinct perspectives—compliance with regulatory requirements and, what we believe is most important, improvements to the decision-making process at ALCO. Not only do we provide recommendations for improving your process, we also provide guidance and support for implementing the recommendations.
It is not sufficient to simply have an IRR and liquidity process in place to have a successful ALCO process. Knowing what information needs to go to ALCO and how to implement it into your decision-making process is critical for the ongoing success of the bank. DCG’s on-site ALCO Workshop is customized to your needs and provides education and consultative support to take your ALCO to the next level.
DCG’s Liquidity Risk Review provides guidance on implementing a forward-looking measurement and management process that incorporates contingency planning, stress testing and early warning triggers. As with all of our Validation services, the Liquidity Risk Review goes beyond the regulatory requirements to ensure your bank is properly incorporating liquidity metrics within its ALCO process.