ALCO POLICY REVIEW

One of the more important components of an effective ALCO process is the development and ongoing review of related policies. Policies should be dynamic documents that integrate risk measurement standards (including risk limits), risk management processes, and Board oversight and reporting. The ongoing review and development of ALCO policies is occasionally overlooked, but this review is important from corporate governance and regulatory perspectives.

The ongoing liquidity crunch of 2007/8 highlights the need for better Liquidity management practices. A key component of this process is the development and review of an updated Liquidity Contingency plan. If you have not updated your Liquidity Contingency Plan & Policy recently, we suggest you do so. Policy review and development assignments we have successfully completed include:

• ALCO charter
• ALLL Policy
• Capital Policy
• Economic Capital Policy
• Derivatives & Hedging Policy
• Interest Rate Risk Policy
• Investment Policy
• Liquidity Contingency Plan & Policy
• Liquidity Management Policy
• Market Risk Policy

Please contact us for more information on how we can help review and update your ALCO-related policies.