As the industry continues to consolidate and competition moves beyond the old geographic limitations, there is one fundamental assumption that has become integral to success in banking: deposit decay rates. While the concept is most well-known for its importance in measuring interest rate risk, it has implications that touch nearly every major balance sheet decision. High performing institutions almost universally have a sound understanding of the expected behavior of their funding base, and can therefore optimally invest while properly managing risk. In this session we will cover the various tools available to banks to better measure deposit decay rates, and how that information can then be translated to better strategy.
Benefits
After this session, attendees will:
• Understand the most common methodologies for measuring deposit decay rates, including pros and cons
• Be able to better document deposit assumptions for asset liability management purposes, including interest rate risk, liquidity forecasting, and budgeting
• Be able to evaluate the optimal asset allocation given the profile of their funding base
• Have pricing strategies at hand for the next phase in the interest rate cycle
Who Should Attend
• Financial Officers
• Risk Managers
• Internal Auditors
• Controllers
• Asset Liability Management Staff
• ALCO Members
• Retail Deposit Staff
• Investment Officers