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Asset Liability Management

Community banks face a common challenge — to satisfy regulatory expectations with respect to measuring and managing interest rate risk in the bank. The active management of this risk with a robust asset liability management process is crucial to a bank's overall risk management process and to protect earnings and capital. PCBB's Asset Liability Management (ALM) service will help your institution meet regulatory expectations and incorporate best practices into your interest rate risk management program.

Key Benefits:

  • Saves you time and money by providing robust and comprehensive risk modeling and management from a turnkey solution
  • Frees up staff for other activities while having access to bank experts for value-added insight
  • Eliminates the need for software management (configuration and maintenance), giving you time to focus on results and emerging trends

PCBB's Asset Liability Management Service


  • Multi-level reports facilitate review of results with board and management, while also providing a level of detail geared towards regulators:
    • Executive overview (graphics)
    • Primary ALCO package
    • Individual scenario results (summaries)
    • Detailed model configuration
  • Identify conditions that drive changes in your bank's balance sheet and risk profile
  • Evaluate reasonableness & usability of data and inputs
  • Back-testing vs. projections included


  • Professional staff also reviews results with you and/or your board, examiners and auditors
  • Ongoing support to help your staff prepare for regulatory and accounting reviews

Scenarios Evaluated:

  • Static — required to quantify core risk
  • Dynamic — required to quantify risk embedded in the bank's operating plan
  • What-if or alternative strategies, sensitivity analysis, integrated stress scenarios (simulation of combined rate, credit and liquidity events)

Shock Scenarios Generated:

  • Immediate (+/- 100, 200, 300, 400)
  • 2-year ramp (+/- 200, 400, 600, 800)
  • Alternative — curve twist (steeper, flatter, inversion, etc.)

Risk Measures

  • Economic value (static and forward)
  • GAP (repricing & liquidity)
  • Earnings (net interest income, net income)
  • Cash flow (source/use)

How Do I Get Started?