Asset-Liability Committee (ALCO) - Governance Framework

Workshop overview:

The asset-liability committee (ALCO) is the primary balance sheet risk forum in a bank, and its importance was recognised by the Regulatory Authorities in an FSA “Dear CEO” letter issued in January 2011 and by the PRA in LSS1/13 published in 2013.

An efficient ALCO process enables a bank to manage risk effectively and optimise its balance sheet, with positive impact on balance sheet resilience and Return on Capital.

The failure of Silicon Valley Bank and First Republic Bank in 2023, which was due to poor asset-liability management (ALM) discipline, has reaffirmed the importance of the ALCO and why its governance framework must always be best-in-class.

This one-day interactive workshop will raise awareness and understanding of recommended good-practice principles for bank ALCO governance and procedure. Aimed at ALCO members, non-executive directors, and senior managers in any banking institution, as well as all staff involved in the ALCO process, the course presents essential tools required to introduce the right governance culture in a bank. This includes a range of policy templates that can be applied in any bank, together with real world examples and case studies to demonstrate techniques.

Delegates will gain a clearer understanding of how to formulate and drive the ALCO governance process in the most effective way, and what makes an effective ALCO MI pack, plus a toolkit of best practice ALCO templates.

We are also running this training on 20 November. Full details here.

Learning outcomes:

Understand the proper role of the ALCO in Bank governance and risk management
Learn how to implement a genuinely effective and robust ALCO process
Become familiar with ALCO organisation and operating framework
Understand the ALCO as part of the balance sheet risk management triumvirate
Ensure the suite of ALCO balance sheet risk management information (MI) is fit for purpose
Draft, as part of a group exercise, the ALCO Terms of Reference, Agenda and MI Pack

Interested in taking any of our workshops in-house?

Whether you are seeking to upskill your team, enhance productivity or foster a culture of continuous learning, we can deliver customised training programmes designed to meet your specific needs. If you have an enquiry, you can complete the in-house form and our training team will be in touch with next steps.

IN-HOUSE TRAINING

You might also be interested in:

We are running similar workshops in prudential risk that may be relevant to you or a colleague, see below for details.

If you would like to attend one or more sessions or have multiple delegates interested from your organisation, please contact us for a discount.

28 April - The Internal Liquidity Adequacy Assessment Process (ILAAP) - Good-Practice Principles

17 June - Interest Rate Risk in the Banking Book (IRRBB) - Good-Practice Principles

23 June - Internal Capital Adequacy Assessment Processes (ICAAP) - Good-Practice Principles

Area of expertise:

Prudential risk, reporting and tax

Professor Moorad Choudhry

Non-Executive Director, Newcastle Building Society

Moorad Choudhry is a non-executive director at Newcastle Building Society, and Honorary Professor at University of Kent Business School. He was l...

Moorad Choudhry is a non-executive director at Newcastle Building Society, and Honorary Professor at University of Kent Business School. He was latterly Treasurer, Corporate Banking Division at The Royal Bank of Scotland, having begun his career at the London Stock Exchange in 1989.

Moorad is a Fellow of the Chartered Institute for Securities & Investment, a Fellow of the London Institute of Banking and Finance, a Fellow of the Global Association of Risk Professionals, a Fellow of the Institute of Directors and a Liveryman at The Worshipful Company of International Bankers. He is author of The Principles of Banking (John Wiley & Sons 2012, 2023).

Moorad was born in Bangladesh and lives in Surrey, England. He was educated at Claremont Fan Court school, the University of Westminster and the University of Reading. He obtained his MBA from Henley Business School and his PhD from Birkbeck, University of London.

All ALCO members
Treasury team members
CFO and team
CRO and team
Board NEDs
Regulators and bank supervision team
Regulatory reporting department
Compliance and internal audit
Money markets and ALM desk