ROLE OF ALM IN RISK MITIGATION FOR INDIAN BANKS WITH REFERENCE TO STATE BANK OF INDIA

Abstract

The State Bank of India is employed as a case paperin this investigation to illustrate how asset-liability management (ALM) can help Indian banks stabilize their finances and reduce financial risks. Asset-Liability Management (ALM) can be implemented by banks to optimize their financing procedures and mitigate risks, including liquidity, interest rates, and credit fluctuations. SBI enhances operational efficiency and resilience by employing ALM approaches to evaluate interest rate sensitivity and maintain liquidity buffers. Stress tests and gap analyses are indispensable for the identification, assessment, and mitigation of risks within your financial institutions. The paperunderscores the importance of rigorous regulatory compliance, strong internal controls, and Asset Liability Management (ALM). As per SBI's experts, the integration of asset liability management into your strategic planning process helps to improve risk control and foster long-term success.