Beruflich Dokumente
Kultur Dokumente
ALM: ALM is the management of Assets & Liabilities in the balance sheet in
such a way that the net earning from the interest is maximized and Liquidity
Risk and Interest rate risk are minimized. It is mandatory now for banks
since 1st April 1999.
RBI has issued guidelines on ALM to banks. Banks have to use the Flow
Approach and construct maturity ladders to identify and manage the
mismatch and gaps.
Maturity Buckets: There are two different maturity ladders constructed for
the purpose of Liquidity and interest rate management.
Liquidity Buckets: 1) Next day 2) 2-7 days 3) 8-14 days 4) 15-28 days 5)
29-90 days 6) 91-180 days 7) 181-365 days 8) 1-3 years 9) 3-5 years 10)
above 5 years.
Interest rate sensitivity: 8 time buckets 1) 1-28 days 2) 8-14 days 3) 2990 days 4) 91-180 days 5) 181-365 days 6) 1-3 years 7) 3-5 years 8) above
5 years and 9) Non-sensitive.
Mismatch Position: When a particular maturity bucket, the amount of
maturity liabilities or assets does not match, such position is called
mismatched position, which create surplus or liquidity crunch position and
depending upon the interest rate movement, such situation may turnout to
be risky for the bank.
Ceiling on Mismatch position (RBI Guidelines):
For liquidity,
mismatches for cash flows for the first four buckets not to exceed 5%, 10%,
15% and 20% respectively of cash outflows for those buckets. For Interest
Sensitivity mismatches for cash flows for 1-14 days and 15-28 days buckets
to be kept to minimum (not exceed 20% each of cash outflows for those
buckets.
ADR, GDR and IDR:
American and global depository receipts: American Depository Receipts
(ADR) and Global Depository Receipts (GDR) are instruments in the nature of
depository receipt or certificate. These are negotiable and issued by non-US
Company, representing publicly traded, local currency equity shares. For
Indian corporates, it is preferred source of raising capital in foreign markets.
Non-resident Indians (NRIs) prefer to invest in these instruments. ADR are
listed on American Stock Exchange whereas GDRs are listed in a Stock
Exchange other than American Stock Exchange say Luxemburg or London.
Indian Depository Receipts: Companies incorporated outside the country
raise resources from the Indian capital market with issue of Indian Depository
receipts (IDRs). IDR means any instrument in the form of depository receipt
sale
Tier II capital:
1) Un-disclosed reserves and cumulative perpetual preference shares.
2) Revaluation Reserves ( at a discount of 55% while determining their
value for inclusion in Tier II Capital)
3) General Provisions & Loss Reserves (Up to maxi. 1.25% of weighted
risk assets)
4) Hybrid debt capital instruments.
5) Subordinated Debt (Long term unsecured loans)
6) Redeemable Cumulative Preference Shares.
Capital Adequacy Ratio (CAR):
Capital adequacy ratio reflects the adequacy of the capital funds (that is
Share capital, free reserves and other capital funds) in relation to the riskweighted assets. It is calculated as
CAR = Capital funds / Risk Weighted Assets * 100 = 9%
Capital Funds: RBI Guidelines envisaged (decided in near future) a two Tier
capital structure namely Tier I and Tier II.
0%
20%
2.5%
20%
50%
75%
77.5
%
100
%
50%
0%
100
%
100
%
50%
0%
0%
125
%
150
%
Revised guidelines:
Educational loans will be hence forth be classified as Non-consumer credit for
capital adequacy norms.
The risk weight applicable to educational loans
would be as:
a) Under Basel I: the risk weight would be 100% as against 125% at
present.
b) Under Basel II : the Educational loans, now no longer being a part of
Consumer Credit would be treated as a component of the regulatory
retail portfolio and attract a risk weight of 75% as against 125% at
present.
CIBIL:
CIBIL is the Indias first credit information bureau, which is a repository of
factual information on the credit history and repayment records of
commercial and consumer borrowers.
CIBIL will provide this specific
information to its members in the form of credit information reports. CIBIL is
promoted by several market players including SBI and has a corpus of Rs.
25 crores. To start with, CIBIL is maintaining a database on suit-filed
accounts of Rs. 1 crore and above and suit-filed accounts [willful defaulters]
of Rs. 25 lacs and above. This information is based on a application
developed to enable the users to access date through a parameterized
search process across banks and companies at various geographical
locations. Suit-filed accounts of lower value are proposed to be covered in a
phased manner.