Vital for banks to manage liquidity risk

PETALING JAYA: Banks risk failure when they are not able to maintain sufficient liquidity even though they may have good asset quality, strong earnings and adequate capital, according to SAS Malaysia.

“To address this concern, financial institutions should have a well-communicated strategy for day-to-day liquidity risk management, apart from the need to establish robust methodologies for monitoring, measuring and managing their liquidity funding strategies,” said SAS Institute Sdn Bhd (SAS Malaysia) director for financial services industry Helen Lim.