Strategic balance-sheet management

The quest for performance

The industry challenges resulting from the introduction of CRD IV will increase the pressure on the bank’s management to address these new constraints adequately and to maintain an acceptable level of retun.

This article illustrates the impacts of the CRD IV on the bank’s performance and suggest improvement.

Executive summary

The industry challenges resulting from the introduction of CRD IV will increase the pressure on the bank’s management to address these new constraints adequately. The CRD IV will impact not only the accounting and risk functions, but the whole banking organisation from commercial activities to treasury departments. Banks’ liquidity and funding management will tend to be an increasingly strategic instrument that will give competitive advantage to institutions that implement proper governance and decision processes.

Together with the ALM functions, the risk management department will need to ensure that emerging trends and regulatory changes are analysed in detail in order to appropriate insights for the risk oversight duties of governing bodies (senior management and board of directors) when setting business strategies. To do so, those departments might need to improve the integration and/or the sophistication of their processes (fund transfer pricing, automation of reports, development of central data management, etc.) in order to better capture the various drivers impacting the bank’s performance, as well as their interconnection.

Understanding and actively monitoring the various indicators that will track these drivers will no longer be an option when entering this new risk and capital management era.

Inside magazine issue 3, February 2014

Inside is Deloitte’s quarterly magazine offering an exclusive insight into best practices, trends and opportunities faced by our clients across all industries.

Inside focuses on the main hot topics relevant for the market (Asset management, Banking, Insurance, Public sector, Healthcare, Private equity, Real estate, TMT, Manufacturing and consumer business, Transport and logistics 

Inside magazine issue 3
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