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Asset Liability Management and Treasury
Asset Liability Management (ALM) and Treasury is in charge of liquidity, interest rate and structural currency risk management both at the Group’s level and at a local level.
Professionals within ALM and Treasury ensure that BNP Paribas always has sufficient liquidity to honor its commitments to clients and counterparts, providing the funding to meet cash requirements and placing cash surpluses. They also assess interest rate risks linked to the Group’s balance sheet, and implement the appropriate hedging strategies.
ALM and Treasury has three core functions:
- the management of the Group’s liquidity and its benchmark price in the markets on all tenors
- the management of structural foreign exchange risks (linked to P&L and to the Group’s investments)
- the management of interest rate risks in the balance sheet
BNP Paribas’s increasingly global presence means that assets and liabilities are held in a wide range of currencies, and transactions are made in different markets and across varying maturities. At the same time, regulatory pressures mean that accuracy and rigour in liquidity management are more important and more sophisticated than ever before. ALM Treasury ensures that the business has not only enough liquidity to meet its operational commitments but also to satisfy the prudential requirements on each market in which it operates. At the same time it works to assess and mitigate the risks associated with exchange rate volatility and client and counterparty actions when operating across multiple currencies and jurisdictions, and to understand the impact of interest rate changes on the banks assets and liabilities.
ALM focuses on risk analysis and medium/long term financing needs, while Treasury manages short-term funding up to one year, including intra-day liquidity management and cash clearing, and is in charge of monitoring liquidity crises.
The facts
- Guaranteeing that BNP Paribas is able to honour its commitments to clients, and to counterparts on the financial markets
- Mitigating foreign exchange and interest rate risks
- Over 300 staff across 42 countries
