Oracle Financial Services Asset Liability Management

Volatile market conditions and increasing regulatory pressures are placing greater demands on the risk management function. These stresses are driving financial institutions to review their current risk modeling and measurement capabilities. Yet, these circumstances also provide institutions with the opportunity to update technology solutions to systems fully integrated across the risk and performance spectrum. Departmental, one-off solutions are no longer viable alternatives in an environment where all systems need to work together.

Oracle Financial Services Asset Liability Management (ALM) helps financial services institutions measure and manage interest rate risk and liquidity risk, perform balance sheet valuations, and forecast both net interest income and net income. The Oracle Financial Services ALM solution measures and models every loan, deposit, investment, and off-balance sheet instrument individually, using both deterministic and stochastic methods. This helps institutions gain a better understanding of the risks they have assumed and their sensitivity to changes in economic conditions.


Integrate Risk and Performance Management for Better Results
Oracle Financial Services Asset Liability Management is a next-generation solution that is fully integrated with Oracle’s Financial Services analytical applications and shares a common account-level relational data model.

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BENEFITS

  • Control complexity by implementing a consistent framework for gathering data, measuring risks, monitoring changes, and acting on them
  • Capture instrument characteristics and the nuance of every customer relationship to accurately model balance sheet behavior
  • Apply multiple techniques to measure your exposure to liquidity and market risk
    • Earnings Behavior with Income Simulation
    • Earnings at Risk (EaR)
    • Value at Risk (Var)
    • Static and Dynamic Gap
  • Measure total balance sheet level results, individual portfolios, or each unique customer relationship
  • Apply sophisticated stochastic analysis
    • Generate market valuations of instruments with embedded options
    • VaR and EaR projections
    • Use a highly tuned Monte Carlo engine
    • Choose from 4 term structure models, 3 yield curve smoothing techniques, and 2 random number generators
  • Model specific instrument features and types
  • Generate account level cash flows taking into account caps, floors, lags, discounts, and any other unique payment or repricing characteristics
    • All banking and treasury products, both on and off balance sheet
    • Flexibly manage processing and assumptions
  • Control data and assumption information for each type of product
    • Analyze results according to preferred future time ‘buckets’
    • Store assumptions in isolation from instrument data easily create alternative scenarios

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