c. myblog

April 19, 2011

NEV Shares At Par

Q: Does assuming NEV non-maturity deposits at par isolate changes in balance sheet structure? A: No. Some people think that valuing non-maturity deposits at par is more conservative and isolates changes in balance sheet structure simulation to simulation.  This is not the case.  NEV with non-maturity deposits at par shows exactly the same result whether […]

April 7, 2011

Static Income Simulation – Things To Consider

One of the traditional approaches to income simulation is to use a static balance sheet, which assumes that a credit union’s mix of assets and liabilities remains constant, regardless of external forces.  In other words, static analysis assumes that every dollar of mortgages that matures is immediately put back into a new mortgage at the […]

March 31, 2011

Lower Earnings Or Increased Interest Rate Risk?

If there is one thing to be said infallibly about risk management, it is never black and white.  The historically-low rate environment coupled with mostly-anemic consumer loan demand has put increased pressure on credit union margins across the nation; moreover, many are reaching their floor with regard to lowering deposit rates.  In light of the […]

March 17, 2011

Caps On Debit Cards?

A recent article from CNNMoney.com reported that JP Morgan Chase is proposing a cap of $50 (or $100) on individual debit card transactions in an effort to boost transaction volume.  Not surprisingly, they attribute the proposal to the pending changes in rates on interchange income.  Chase claims that debit cards will not be profitable for […]

March 10, 2011

Doing More With Less

Experts say one of the biggest outcomes from the current recession will be leaner companies that run more efficiently with less staff.  According to a recent article titled Companies Do More With Fewer Workers (USA Today, 02/23/11), productivity has risen more in the current recovery than previous ones (except for 2001), jumping 3.5% in 2009 […]

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