Funds Transfer Pricing (FTP) is an essential part of every bank's liquidity risk management framework - the PRA considers the FTP mechanism to be a vital part of the ILAAP liquidity risk review and approval process. This recognises that FTP is an important part of the risk management process, assisting in understanding the profitability of customers, product lines and organisational units within a bank.

This one day workshop provides comprehensive coverage of the best practice approach to the bank internal funds pricing framework. It explains the process and implementation of the FTP mechanism in clear and practical terms, to enable delegates to acquire an understanding of best-practice FTP principles, and how they can be integrated into ALM policies, thus optimising the bank's liquidity management framework.

A well designed FTP framework enables a bank to pursue its strategic objectives, conversely a poorly implemented FTP framework can lead to long-term damage to a bank's balance sheet structure and liquidity position.

Outcomes

By the end of this workshop you will be able to:

• Understand the value and importance of an effective FTP mechanism
• Explain at ALCO and Board level the need to have a robust FTP process in place at the bank
• Observe the interaction of business lines, Treasury, Risk and Finance within the FTP process
• Implement a best practice FTP regime and funding policy in your bank
• Construct your bank's FTP funding curve efficiently