For many banks, non-maturing deposits are a highly relevant source of funding. Due to the high degree of flexibility which the product provides to the customer for the usage and to the bank regarding interest rate adjustments, the management decision on how to invest the deposits, from an interest rate risk perspective, is anything but trivial. It can require a high degree of IRRBB know-how, market insights and bank-specific assumptions to build a deposit management approach, which is tailored to the bank.
Next to the economic benefits, extensive regulatory requirements by BCBS as well as international and national regulators (e.g. EBA, Fed, FINMA, PRA) define expectations regarding the modelling approach.
The challenges, in particular from consistently low interest rate, for the modelling of NMD are recently significantly increasing, and banks need to understand better practice approaches and prepare for potential enhancements.
Understanding the bank's challenges, we developed a business analytics. Simply answer a few questions about your current treatment of deposits and afterwards you receive a first assessment of your status, insights on better practices and trends in the industry.