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Liquidity Framework Review

Liquidity risk, along with credit risk and interest rate risk, are the three main types of market risks facing a credit union. The NCUA has several rules and regulations overseeing effective liquidity risk management, with a focus on liquidity policies, procedures, limits, and monitoring capabilities. Credit unions should expect examiners to thoroughly evaluate the adequacy of their liquidity risk management framework.

How will QuantyPhi help your credit union?

QuantyPhi’s goal is to help you evaluate your liquidity risk management framework and provide recommendations on how to improve your credit union’s liquidity program and pass your exams with ease and confidence.

The Liquidity Framework Review will analyze the robustness and effectiveness of your internal liquidity program, liquidity risk management framework, and liquidity measurement and monitoring tools. The review will ensure you understand your current liquidity position and liquidity risks and have constructed a strong liquidity management framework to ensure your management has timely insight into your current position and emerging risks. QuantyPhi will review all your liquidity documents, procedures, and monitoring tools and provide recommendations outlining ways to improve your process to better manage your liquidity program.

Our liquidity experts will review critical areas of your liquidity framework, including:

  1. Liquidity policy and procedures
  2. Limits for liquidity measures and reporting requirements
  3. Primary and secondary sources of liquidity
  4. Tools for liquidity risk management
  5. Contingency funding plan
  6. Liquidity limits
  7. Contingent federal liquidity source, if applicable

Key features and benefits of the Liquidity Framework Review include:

  1. Comprehensive Analysis: Highly skilled financial experts from QuantyPhi will conduct an in-depth analysis of the credit union’s existing liquidity framework, assessing the adequacy and effectiveness of current strategies.
  2. Customized Recommendations: Based on the analysis, the service provides tailored recommendations and best practices to enhance liquidity risk management, considering each credit union's unique needs, goals, and risk appetite.
  3. Regulatory Compliance: With a deep understanding of regulatory requirements, QuantyPhi ensures that the credit union’s liquidity management framework aligns with industry standards and complies with applicable regulations.
  4. Risk Evaluation: The Liquidity Framework Review service identifies potential risks associated with liquidity management and offers strategies to mitigate these risks, allowing credit unions to proactively manage liquidity-related challenges.
  5. Training and Support: QuantyPhi offers specialized training and ongoing support to credit unions, equipping them with the necessary skills and knowledge to implement recommended enhancements and maintain robust liquidity management practices.

Our highly trained analysts will review your credit union’s liquidity framework against examiner requirements, industry best practices, and relevancy based on current liquidity threats. Then, we will suggest methods and practices to help you enhance your liquidity framework and liquidity risk management program and help you implement any desired changes.

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