DFCC Bank wins global Asset and Liability Management Competition
DFCC Bank won the award for "Best in Risk Management" at the 5th
Asset & Liability Management (ALM) Competition concluded at The Hague in
the Netherlands recently. The competition was jointly sponsored by DEG
of Germany, FMO - The Netherlands Development Finance Company, Proparco
of France and was conducted by SimArch.
DFCC was represented by a team comprising Ms. Manohari
Gunawardhena - Senior Vice President Treasury, Palitha
Gamage - Senior Vice President Planning and Plan
Implementation, Sanjeewa Fernando - Assistant Vice President
Integrated Risk Management and Jayan Fernando - Senior
Project Executive Asset and Liability
Management. |
The competition was conducted in two phases. The first phase, which
lasted three months, was an online exercise. Twenty Six banks from
diverse emerging nations participated in the first round. Six finalists
were invited to The Hague, Netherlands for the final round of the
competition.
During the Second Phase, participants were tested thoroughly on their
ability to make sound judgments on the management of a financial
institution under different internal and external scenarios. The four
member team from DFCC Bank presented the best risk management framework
which satisfied the conditions of profitability and stability.
Commenting on the team's performance, Mr. Nihal Fonseka Chief
Executive of DFCC Bank stated "This Competition offered us a unique
opportunity to showcase our ALM skills and created opportunities for the
exchange of experience and ideas among emerging international bankers".
He added "DFCC Bank is proud of the capabilities of its professionals
and the robust Risk Management culture that exists within the
organization. As one of the few successful Development Financing
Institutions in the world we are firmly committed to good corporate
governance as the driver of a sustainable organization."
Asset and Liability Management is one of the most important areas of
expertise required by financial institutions as it involves managing
balance sheet growth with prudent management of market risk elements
related to credit, interest rate, liquidity, foreign exchange and
operations. The Governance structure for risk management at DFCC is
based on the four fundamentals of Board and Senior Management oversight;
risk management policies and procedures; risk measurement, monitoring
and controls; and internal controls and independent audit.
DFCC uses internally developed credit rating models as a credit risk
quantification tool. This has been a part of DFCC's risk management
practice for nearly a decade. These models are periodically reviewed and
adjusted depending on the bank's business focus and external factors.
DFCC consistently maintains a total capital adequacy ratio close to 20%,
supported by its sustained solid profitability and a healthy economic
and operating environment. (The regulatory requirement for capital
adequacy has been set at 10% while the industry average ranges between
12-13%). The Bank's Risk Management capabilities have continuously been
of a high standard, evidenced by Fitch Ratings Lanka's (FRL) initial
Credit Analysis Report, where FRL affirmed that DFCC Bank's risk
management procedure were "Clearly above average in the Sri Lankan
context".
Continuous commitment to Corporate Governance procedures coupled with
a comprehensive risk management framework has enabled DFCC Bank to
provide unmatched security and stability to its depositors and other
stakeholders while delivering much needed financial impetus to
entrepreneurs who require support and guidance.
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