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Co-Sourced Reporting and Advisory

Co-Sourced Reporting and Advisory:

Much as you would work with an expert to run your Asset Liability Management (ALM) model to produce reports to measure market risk based upon your data and your assumptions, we work with banks and credit unions in a similar manner to produce a set of meaningful reports for liquidity management and compliance.

Although ALM models may produce some ancillary liquidity reports, typically they fall short of what is required to property manage and monitor liquidity risk. Why? Because ALM models are designed to measure interest rate risk and economic capital at risk, not liquidity risk. Although cash flow is affected by changes in interest rates, these ALM models generally can not capture scenarios where there is a liquidity disruption due to a sudden operation loss, a loss in borrowing capacity due to a change in borrowings limits or allowable collateral, nor can the models easily compensate for any proactive balance management you may take to address liquidity risk.

However, using the output data form your ALM model as a base, we can integrate that data and your balance sheet to work with the liquidity event scenarios you develop, and stress test those scenarios given your assumptions. The result is a report set that specifically measures liquidity risk.

How It Works:

Either on a monthly or quarterly basis, after you have identified your liquidity event scenarios and developed your early warning indicators (EWIs), you simply upload your balance sheet and selected ALM model output to our secure web site, and we will model the liquidity data. We integrate with any data output that can be saved in comma delimited or Microsoft Excel format. Results will be presented in a transparent and comprehensive report set, which will be reviewed with management before finalizing. The process used your data and assumptions, and our modeling process to generate a comprehensive report set that can be presented with confidence at your next committee or board of directors meeting.

Please email us for a sample of our liquidity report set.