ALM Seminar 2019 – Eastern PA

ALM Seminar 2019 – Eastern PA

Thursday, October 10, 2019
Radisson Hotel Harrisburg
1150 Camp Hill Bypass, Camp Hill, PA 17011



To review program details and register by mail, please download the REGISTRATION BROCHURE

To register online, please complete the ONLINE REGISTRATION FORM


BEST PRACTICES IN ASSET/LIABILITY MANAGEMENT: This annual program will focus on the critical issues bank ALCOs are facing in 2019, and what we anticipate for 2020. Economic data has been more and more positive in 2019. 1st quarter GDP growth was 3.2%, and forecasters expect continued good growth in 2019. Consumer spending and business investment are need for continued economic expansion. This business cycle is 121 months into expansion in July, and is now the longest expansion in history. Consumer and business confidence is positive, and the unemployment rate was at a 50 year low of 3.6% in April. The housing market is strengthening along with the labor market. All of this activity is not moving inflation rates above 2%, a level desired by the Fed. All of this positive news bodes well for bank lending, and loan demand is very good in most areas of Pennsylvania. But we should be caution in liquidity management, and commercial lending as the cycle matures.

The most important variable for the ALCO to focus attention on is short-term interest rates. The Fed moved rates up three times in 2017, and four times in 2018, but there is no forecast of an increase in 2019. Deposit pricing became very aggressive in the second half of 2018, and remains relatively aggressive 2019, but with the Fed on hold, deposit rates should stabilizes along with the cost of funds by the 4th quarter of 2019. Banks have struggled with internal cannibalization of deposits in 2018, and we are defending our deposits from local and internet competition in 2019.

The seminar will focus on regulatory concerns mainly with commercial lending, and liquidity management. Interest risk management appears to be less of a concern in 2019. Liquidity management will be a major concern for your ALCO through 2019 as retail deposit growth is difficult and costly. The program will conclude with asset and liability decision making in 2019 into 2020. As loan demand has increased, investments have become less of a priority, but investment portfolio strategies continue to be an essential element of ALM. Liability management had not been a significant concern for over nine years, but it became our primary concern in 2018 and is continuing into 2019. Deposits strategies to cope with a changed rate environment need to be discussed in the ALCO meetings. We will also explore wholesale strategies involving the FHLB advances and brokered CDs.


CEOs, CFOs, COOs, Directors, Investment Managers, ALCO Committee Members, Lenders, Risk Managers and others involved in ALM


Bring a NextGen Banking Leader along to this important seminar. Let them learn from the expert and network with colleagues in an interactive educational environment. This experience will help them grow and be a stronger member of your bank’s team. NextGen bank leaders receive $100 discount on the registration fee.


Up to five (5) hours of CPE will be offered for this program. PACB is an approved provider of continuing education by the PA State Board of Accountancy.


8:00am: Registration & Refreshments
8:30am: Current Environment
• Regulatory Overview
• Business Cycle Trends & the Impact on Pennsylvania Banks
• Interest Rate Forecast – Fed became more aggressive in 2018
• Liquidity Management – Liquidity is shrinking on bank balance sheets as rates increase
10:00am: Refreshment Break
10:15am: Seminar Continues
• Interest Rate Risk – Examiner comments, and insights from independent reviews
• Modeling IRR – Validating assumptions remains a concern of examiners.
12.00pm: Lunch
1:00pm: Managing Assets in the Current Environment
• Funding growth for 2019 – Liquidity Management
• Investment Options on a flattening Yield Curve
• Lending
• Residential lending is a challenge and this will continue. More strategic than ALCO.
• Managing concentrations in CRE lending
Managing Liabilities in the Current Environment
• FHLB Strategies
• Growth in Broker deposits – a trend to watch.
• Deposit Strategies: Moving customers from large savings pools to CDs. Let’s look at changing cost of funds
• Preventing internal cannibalization & Defending Deposits
• Challenges Facing ALCO In 2020
3:30pm: Adjournment


Dr. James Clarke, Principal, Clarke Consulting
Dr. James Clarke is the Principal of Clarke Consulting, a Villanova, Pennsylvania firm specializing in ALCO issues and strategic planning for community banks. Jim has lectured on asset/liability management at the Stonier National School of Banking sponsored by ABA, the Southwest Graduate School of Banking, the New England School of Financial Studies and Connecticut School of Banking. He conducts ALM seminars for many state associations, and for Risk Management Association (RMA) and Financial Managers Society (FMS). Jim also conducts board education programs on ALM for a number of state associations. In 2017 through 2018, Jim spoke at the Connecticut, Maine and Pennsylvania Association of Community Bankers conventions and number of director conferences. Dr. Clarke is on the Board of a community bank, and is a Director of an investment company. Jim is also on the Editorial Board of the RMA.


Camp Hill Location: The PACB has a special rate at the Radisson Hotel Harrisburg. 150 Camp Hill Bypass, Camp Hill, PA. Please contact the hotel directly at 717-763-7117 for reservations. Please mention the PA Association of Community Bankers to secure the special rate.
Monroeville Location: Contact the Doubletree, 101 Mall Blvd, Monroeville directly at 412-373-7300 for reservations. Please mention that you will be attending a PA Association of Community Bankers seminar to secure a group rate.