c. myblog

March 23, 2017

Interest Rates Have Risen – Now What?

The 3-month Treasury rate has moved more in the last 8 months than it has in the preceding 8 years.  For many who think of A/LM in a time of rising rates, it can be time to calibrate pricing strategies, non-maturity deposit withdrawal assumptions, or loan prepayment speed assumptions.  Others may begin to consider strategic […]

February 15, 2017

Too Much Loan Growth?

Many credit unions have had the good problem of being so successful in lending that liquidity has become a challenge.  A blog we wrote in December 2016 identified 6 key questions that decision-makers should evaluate on the issue.  This post expands on that topic by looking at several possible liquidity solutions credit unions are considering […]

January 26, 2017

Interest Rate Risk Management: Timing of Earnings Matters

Would it surprise you that some interest rate risk mitigation strategies actually add risk for a period of time?  In the end, these strategies may be effective at mitigating interest rate risk but it may take years for the effectiveness to be felt.  The challenge is that many methods used to test mitigation options, like […]

January 5, 2017

Some Things to Consider About a Rising Rate Environment

The Federal Reserve increased the federal funds target rate to a range of 50-75 bps at its mid-December meeting.  In its forecast (the “dot plot” shown below), the Fed indicates further tightening in 2017. While credit unions have certainly lived through rising rate environments in the past, few have managed a credit union through a […]

November 3, 2016

6 Dos and Don’ts of the NCUA’s NEV Supervisory Test

Consider the following as you implement the NCUA’s NEV Supervisory Test: DO make sure to understand your answers by running NEV with the non-maturity deposit caps the test uses (currently 1% and 4%) before NCUA comes into your credit union. DON’T forget why NCUA decided to standardize. One of many reasons is that there is […]

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