How Good Are Your Assumptons?

Factoring Key Assumptions

By Mark H. Smith

Photo Over the last three decades ALM models have evolved from simple spreadsheets estimating a gap between the repricing points of assets and liabilities to sophisticated computer driven software that considers a nearly unlimited number of variables in the process of estimating interest rate risk (IRR).

One thing that hasn't changed is the importance of the role that assumptions play in the estimated modeling outcomes.

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The Financial Institution of Your Dreams

By Cynthia Walker, CEO and Jeffery Johnson

Photo When people I meet find out I work with credit unions they often ask, "Why should I join a credit union instead of a bank?" Many of us in the industry give an answer about the benefits of being a member vs. a depositor and the credit union philosophy of "People Helping People".

While I believe these reasons are solid and go a long way towards retention, they usually do not seem to resonate enough with a person to compel them to make a change.

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Economic Outlook

By Matthew Jacobsen

Photo After 7 years of historically low rates, the Federal Open Market Committee (FOMC) increased the Fed Funds target rate by 25 basis points. However, the press release of the announcement also included the caveat, "The Committee expects that economic conditions will evolve in a manner that will warrant only gradual increases in the federal funds rate; the federal funds rate is likely to remain, for some time, below levels that are expected to prevail in the longer run."

Clearly the FOMC is warning readers not to expect a repeat of the events of 2004/2006 when the target rate was increased by 425 basis points spanning over 24 months.

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Credit Union Investing Basics: Why Liquidity Matters.

By Jason Williams, Portfolio Manager at Moreton Asset Management

Photo One of the terms that comes up regularly in audit and regulatory exams for credit unions is "liquidity." As you evaluate investments, and consider your overall investment portfolio needs for your credit union, liquidity can be an important factor.

Many credit union management teams don't always remember some important considerations relative to liquidity in the investment portfolio.

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Jan./Feb. 2016

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Survey Results - Rising Interest Rates

By Mark H. Smith, Inc. Staff

It was a long time coming.

Following seven years of near-zero rates, the Federal Open Market Committee raised the Fed Funds target rate..   Read Full Article

Upcoming Webinars

Webinar: How Good are Your ALM Assumptions?
Wednesday, Feb. 17, 2016
12:00 PM – 1:00 PM MST
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Webinar: Structuring Your Investment Portfolio for Liquidity
Wednesday, Mar. 16, 2016
12:00 PM – 1:00 PM MST
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Third Party IRR Process Validation Review

The third party review is frequently requested by regulators who would like to see an independent or outside review of the quality and effectiveness of the credit union's IRR management process.  Learn More


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