The internal liquidity adequacy assessment process (ILAAP) regime is an important part of the bank supervision regime, and a cornerstone of Basel III and CRDIV regulatory principles. The need to ensure an efficient ILAAP process has also been reinforced with the finalisation of the PRA’s Pillar 2 liquidity regime. As a resource-intensive process, it is vital for banks to implement firm-wide procedures that ensure an efficient and effective ILAAP process.
In order to ensure an effective ILAAP process, banks must adopt a proactive and planned approach to liquidity management taking into account the institution’s specific risk appetite and business model.
This workshop presents best-practice ILAAP principles and draws out the main pointers and processes necessary to ensure efficient ILAAP results, as well as an optimised balance sheet and bank liabilities strategy.
By the end of this workshop you will be able to:
- Operate an efficient and optimised ILAAP process that incorporate, and benefits, the entire bank
- Obtain presentable results sooner and with greater effectiveness
- Transfer knowledge bank-wide on “What makes a good ILAAP?”
- Implement an integrated liabilities strategy that will optimise the liability structure in response to NSFR and LCR
- Answer the question, “What makes a good ILAAP?”
The workshop makes extensive use of case studies and real-world examples to demonstrate how best to implement an effective and efficient ILAAP process. Delegates take part in Group Exercises that assist in learning best-practice principles.
Who should attend?
ALCO members, Board Non-executive directors, Head of Treasury, Head of Balance Sheet Management, Head of Money Markets, Head of ALM, Head of Liquidity Risk, CRO and staff, CFO and staff, Head of Regulatory Reporting, Head of Internal Audit, Management consultants in Basel III space.
Topics covered will include:
- Best-practice ILAAP process principles
- Processes and workstreams for stress testing, setting, scenario planning and results optimisation
- “What makes a good ILAAP?” “What makes a better ILAAP?” – pointers for efficient
ILAAP process and results
- The role of the Board, EXCO, ALCO and senior management
Stress testing and ILAAP results
- Stress testing, scenario analysis and planning for failure
- Making the management processes robust and responsive
Sample ILAAP presentation: reviewing a best-practice format (hypothetical UK commercial bank)
- LCR: reporting, optimisation, and impact on liabilities strategy
- NSFR: reporting, Strategic ALM and balance sheet management implications
- Additional monitoring metrics, intra-day liquidity requirements
- HQLA principles
Professor Moorad Choudhry lectures on the MSc Finance programme at University of Kent Business School. He has 30 years experience in banking in the City of London and was latterly Treasurer, Corporate Banking Division at The Royal Bank of Scotland. Material from the authors book The Principles of Banking will be used on this workshop..
Take this training in-house
If you have five or more delegates who wish to attend this briefing, it may be more cost effective to run it in-company. To find out more about in-company training, please contact Philip Allen Director of Learning on 0207 216 8843 or email@example.com