Asset-liability management

(ALM).

An approach to risk management which analyses an organisation's assets and liabilities as a combined portfolio.

For non-financial organisations, asset-liability management is particularly concerned with the management of interest rate risk, taking account of the expected impact of interest rate changes both on assets and on liabilities, and also taking account of the relationships between the expected impact on the assets and the expected impact on the liabilities.

Financial institutions work with asset-liability management in a broader context, dealing with other asset and liability risks and inter-relationships, beyond interest rate risk.

In the context of financial institutions, this work is more often known as 'asset and liability management'.

See also

• ALCO
• Asset and liability management
• Asset and Liability Management Association (ALMA)
• Asset management
• Guide to risk management
• Interest rate risk
• Liability driven investment (LDI)
• Risk management
• Treasury