What is ASSET-LIABILITY MANAGEMENT (ALM)

A business and RISK MANAGEMENT practice where BANKS and SECURITIES FIRMS manage the CASH FLOWS generated by ASSETS (e.g., LOANS, REVERSE REPURCHASE AGREEMENTS, investments), LIABILITIES (e.g., DEPOSITS, REPURCHASE AGREEMENTS), and OFFBALANCE SHEET ACTIVITIES (e.g., DERIVATIVES , REVOLVING CREDIT AGREEMENTS, GUARANTEES). Depending on a bank