Risk Management Practices in Banking Sector Through Asset Liability Management A Study

Abstract

Risk is inevitable for any business concern, Since Banks are commercial Organizations, and they are also not exempted from the risk. Risk in banking is primarily concerned with the possibilities of loss or decrease in asset value from events like economic slowdown, unfavorable fiscal and trade policies, adverse movements in interest rates, exchange rates or falling of equity prices. Technically these risks are called as interest rate risk, liquidity risk, credit risk, market risk. In order to mitigate these risks banks are following an integrated risk management technique called as, Asset Liability Management. This technique facilitates the bank to mitigate the risks and assists the bank to increase its profitability. newline