NBQ was using Microsoft excel for all its ALM needs but the excel based process and reporting was not sufficient to meet their management and regulatory requirements, thus NBQ sought to implement an integrated ALM solution.
Problems Faced
Bank didn’t have a system in place for ALM and all the reports were generated using excel by collecting data from various source systems manually. Since it was done manually there were quite a few challenges, like:
- Time taken to compile data and generate regulatory reports was very high
- ‘What if’ scenarios could not be modelled
- Computation of various Balance Sheet Ratios, setting up and monitoring of risk tolerance level and threshold limits on an on-going basis was tedious.
- It was not possible to prepare requisite Gap Reports on daily basis
Surya's Approach
The National Bank of Umm Al Quwain (NBQ) faced a significant challenge in generating reports using Excel, as it required collecting data manually from various source systems. Recognizing the bank's needs and the difficulties they were encountering, Surya stepped in to offer a tailored ALM solution. This powerful tool enabled NBQ to generate reports quickly and efficiently, greatly reducing the time and effort required for this crucial task. As a result, NBQ was able to streamline its operations, optimize its reporting capabilities, and ultimately enhance its overall performance. Below are the reports which are used by the Bank: • Liquidity Risk Measurement • Interest Risk Measurement • Scenario Analysis • Ratio Builder • Ratio & Trend Analysis • MIS & Regulatory Reports
Benefits of Implementing Surya's ALM
- BALM has enabled interface with all data sources thus reducing significantly the time required to upload, aggregate and validate data.
- Liquidity & interest risk analytical are available every day before start of the Business.
- CXO’s are now enabled to precisely analyze the impact of a wide variety of business decisions on the bank’s balance sheet.
- Users are not only able to measure changes in Net Interest Income & Margin with changes in macro-economic factors but can also forecast the NII and Margin.
- Scenario Analysis helps to simulate various ‘what if’ situations by applying multiple transformation functions on native and scenario data.
- Key Ratio Builder enables users to create & monitor tolerance limits of multiple ratios.
- Automation of MIS reports for both management and statutory reporting
- Compliance with regulatory norms has been enhanced with increased accuracy and consistency of data and assumptions
