Effective balance sheet hedging in the current climate
- June 8, 2020
Balance Sheet Risk Management
Financial Institutions | Kennett Square, PA
In a piece written for BAI, Greg Martell highlights how current market conditions present financial institutions, equipped with the proper tools and strategy, with opportunities that can provide some welcomed relief during this period.
Even before the coronavirus pandemic escalated in early March, market participants expected that there would soon be a decline in interest rates. Many assumed that the late stage of the business cycle would be the impetus for the decline, leading to a possible recession in 2021. To prepare for this market event, many began implementing hedging strategies, lengthening the duration of floating-rate assets.
Ready to learn more?
Contact Chatham to discuss effective balance sheet hedging strategies.
Chatham Hedging Advisors, LLC (CHA) is a subsidiary of Chatham Financial Corp. and provides hedge advisory, accounting and execution services related to swap transactions in the United States. CHA is registered with the Commodity Futures Trading Commission (CFTC) as a commodity trading advisor and is a member of the National Futures Association (NFA); however, neither the CFTC nor the NFA have passed upon the merits of participating in any advisory services offered by CHA. For further information, please visit chathamfinancial.com/legal-notices.
Transactions in over-the-counter derivatives (or “swaps”) have significant risks, including, but not limited to, substantial risk of loss. You should consult your own business, legal, tax and accounting advisers with respect to proposed swap transaction and you should refrain from entering into any swap transaction unless you have fully understood the terms and risks of the transaction, including the extent of your potential risk of loss. This material has been prepared by a sales or trading employee or agent of Chatham Hedging Advisors and could be deemed a solicitation for entering into a derivatives transaction. This material is not a research report prepared by Chatham Hedging Advisors. If you are not an experienced user of the derivatives markets, capable of making independent trading decisions, then you should not rely solely on this communication in making trading decisions. All rights reserved.20-0145
Our featured insights
Our experts examine the factors driving the markets and discuss the balance sheet risk management strategies being implemented by financial institutions. We will share perspective on the interest rate risk management concerns by reviewing the challenges and opportunities in today’s volatile market.
The major U.S. equity indices moved higher for the week amid stimulus bill negotiations on Capitol Hill, rising tensions between the U.S. and China, and a deluge of economic data releases.
In a piece written for BAI, Matt Tevis highlights how smaller institutions are thinking about how they can retain and broaden their new commercial relationships.
Listen to this podcast with The Kafafian Group to hear how banks can win business with sophisticated lending tools.
In this video hear what interest rate swap exposure is and the relevance to the loan underwriting.
See how introducing Third-Party Swaps into the mix may seem simple at first, but can result in control issues for one of the bank’s greatest assets – its customers.
As your financial institution grows, either organically or through acquisition, new challenges emerge. As the largest independent firm with decades of experience, partnering with Chatham Financial ensures your institution's healthy and continuous growth.
As a completely independent firm, Chatham partners with clients to implement integrated solutions, tailoring our focus on advisory and technology in order to meet the needs and goals of your financial institution now and into the future.