The Asset Liability Committee (ALCO) is responsible for balance sheet
(asset-liability)
risk management. Managing the asset liability is the most important responsibility
of a bank as it runs the risks for not only the bank, but also the thousands of
depositors who put money into it. The responsibility of Asset liability
Management is on the Treasury Department
of the bank.
Specifically, the Asset liability Management (ALM) desk of the
Treasury
Department manages the balance sheet. The results of balance sheet analysis along with
recommendation is placed in the ALCO meeting by the Treasurer where important
decisions are made to minimize risk and maximize returns. Typically, the
organizational structure looks like the following
CEO / MANAGING DIRECTOR
|
Head of Consumer
Banking |
Head
of Consumer
Banking Treasury |
Head
of Corporate
Banking |
Head
of Finance |
Head
of Credit |
Head
of Operation |