March 2017 BALM Newsletter Preview - An ALCO Perspective on What Drives Bank Value - by Michael Jamesson of Jamesson Associates. In this important article, Mr. Jamesson writes that our second President, John Adams, opined, “Facts are stubborn things; and whatever may be our wishes, our inclinations, or the dictates of our passions, they cannot alter the state of facts and evidence.” Mr. Jamesson goes on to write that while our current thoughts may not be strictly in line with President Adams, he believes a fact-driven approach to Asset/Liability Management is far preferable to the alternative. Consequently, in this article Mr. Jamesson explores the question of what drives bank value from the perspective of factors that are typically managed through the Alco process. Moreover, he explores the question both over a long period of time and when there is a significant short term change that offers contrasting conclusions. Mr. Jamesson continues to consider the type of reports that a bank’s ALCO typically reviews regarding interest rate risk including: a) EVE Analyses; b) One-Year Simulation Models; and, Yield Curve. Mr. Jamesson concludes from these observations that higher rates should result in lower economic value, but higher net interest income in the long run. If the two standard Alco models for interest rate risk are in conflict, it is important to determine which one is more in line with reality….To continue reading our executive summary of Mr. Jamesson’s article An ALCO Perspective on What Drives Bank Value,click on the March 2017 BALM article in our document library below
2017 BALM Compensation Survey - The editorial staff of the Bank Asset/Liability Management newsletteris in the process of assembling the requisite data for the Newsletter’s 26th annual ALM Compensation Survey. This important survey profiles compensation trends for asset/liability managers within the U.S. financial institutions industry. The complete 2017 Bank ALM compensation survey will be published in our July 2017 BALM issue. To order an advance copy of the 20167BALM Compensation Survey click here.
The BALM Newsletter Software Survey is now available. This valuable listing exhibits the most widely used, commercially available asset/liability management software models used in financial institutions today. The listing is comprised of ALM software priced under $10,000, software from $10,000-$50,000, and more complex software models priced over $50,000. The survey also provides specific capabilities, including costs and hardware requirements for each vendor’s offering. The models exhibited in this list provide tools for identifying specific interest rate risk characteristics, auditing controls, budget development, and more. The software survey and accompanying literature summarizes several essential criteria to be considered prior to purchasing ALM software. To order a copy of the current BALM Software Surveyclick here.