Asset and Liability management

Moody's Analytics offers a powerful ALM Solution for banks that integrates enterprise ALM, liquidity risk management, funds transfer pricing, and regulatory reporting capabilities into a seamless enterprise platform.

Moody's Analytics ALM Solution allows you to accurately assess credit, market and liquidity risks to enhance profitability. The solution includes comprehensive asset and liability management, interest rate risk management, liquidity risk management, transfer pricing (FTP), multi-factor behavioral modeling and balance sheet management capabilities. The solution leverages data from Moody's Analytics data management platform, enabling banks to manage ALM and liquidity along with risk management and Basel III, IFRS 9/CECL compliance work and stress testing.

The solution's powerful capabilities allow ALM to be fully integrated into business management. FTP capabilities allow banks to apply a single, consistent cost of capital across the business. This allows senior management to optimize the allocation of capital across the business to meet strategic objectives. Cash flow management capabilities can be used to calculate liquidity coverage ratio (LCR) and net stable funding ratio (NSFR) to help effectively ensure compliance and manage the business.

Our ALM solution includes capabilities that reduce the complexity of managing the most complicated requirements. The chart of accounts structure captures, organizes and classifies all financial instruments on the balance sheet in a tree structure for easy management. It serves as the basis for determining behavioral patterns and forecasts. The multi-factor behavioral model allows banks to accurately model customer behavior, including early loan repayments, loan commitments, early repayment of term deposits, and deposits with no maturity. It also provides in-depth understanding of both ALM and balance sheet to support management decision making.