Managing balance sheet risks requires a firm grasp on the behavior of funding sources. While core deposits remain the "holy grail" of funding for community financial institutions, recent market volatility, new competitors, and changing depositor demographics present challenges to future funding certainty. In this session, we present the six categories of funding risk that you face and the traditional methods you use to manage them.
Having strong analytics on the retail funding sources within your FI is critical to future risk management and liquidity positions. We describe how to create a funding plan that looks at more than balances and costs but also measures other funding and liquidity risks. We also look at the various wholesale alternatives in today's market and how to approach the strategic use of borrowing funds practically, and within policies.
Participants will come away with a better understanding of:
- How to assess overall funding risks, opportunities, and assessment tools.
- How to build an effective and efficient funding plan.
- The need to focus on growth of non-maturity deposits in preparation for changing rates.
- How segmentation strategies and use of wholesale funding manages risk and performance through "blended funding" of the balance sheet.
- Why institutions pursuing both consumer loans and business loans need to focus on the entire relationship, not just the loan in making loan and deposit pricing decisions.
Target Audience: CEOs, CFOs, ALCO members, controllers, chief risk officer, chief retail, funding officers
Presenter: Dave Koch & Darryl Mataya, Abrigo
Recording available through: July 22, 2021