Subtitle: A practitioner’s guide to liquidity, solvency, measurement, stress testing, and governance IntroductionLiquidity is the ability of a bank to fund asset growth and meet obligations as they fall due without incurring unacceptable losses; solvency concerns long-term capital adequacy and balance sheet net worth. The two are related but distinct—institutions can be solvent yet illiquid…
India’s banking system is in the midst of a decisive shift driven by digital public infrastructure, AI-enabled operations, regulatory tightening, and a renewed focus on resilience and inclusion. The go-forward risk agenda must integrate technology, governance, and forward-looking stress capabilities to safeguard growth while enabling innovation. Digital rails and embedded finance Responsible AI and analytics…
Duration GAP Analysis, stress testing, and backtesting are foundational tools in a bank’s Asset-Liability Management (ALM) toolkit to manage interest rate risk and protect both earnings and economic value of equity (EVE). Structured measurement reports connect these analytics to governance, limits, and action. This article outlines a cohesive approach suitable for policy frameworks and ALCO…
Enterprise Risk Management (ERM) has emerged as a cornerstone of responsible governance and sustainable growth in the banking sector. As institutions operate in increasingly complex environments marked by regulatory pressures, technological advancements, and market volatility, a well-structured ERM framework ensures the identification, assessment, and management of both threats and opportunities. Enterprise Risk Management Defined ERM…