Eric Schaanning, an expert in financial risk management with notable leadership roles at Nordea, UBS, and Credit Suisse, dives into the intricacies of Asset Liability Management (ALM) and Interest Rate Risk in banks. He discusses how recent banking crises highlight the need for effective risk measurement strategies. Insights from case studies reveal the importance of liquidity management and the impact of interest rate fluctuations on financial stability. Schaanning also explores the challenges posed by low interest rates and regulatory frameworks affecting banking practices.

In this engaging discussion, Eric Schaanning, an expert in asset-liability management from Credit Suisse and UBS, shares his wealth of knowledge on managing interest rate risk in the banking sector. He explains the importance of economic value of equity (EVE) and DV01, while highlighting different strategies like macro and micro hedging. The conversation also dives into innovations like reverse stress testing to identify vulnerabilities and the implications of interest rate fluctuations on banks' financial health, enlightening investors on evaluating risks in financial institutions.

Eric Schaanning, an expert in asset liability management, joins Guy Spier to explore the intricacies of interest rate risk in banking. They discuss how interest rate fluctuations can significantly alter customer preferences, impacting deposit behaviors. Schaanning highlights the importance of behavioral modeling in assessing credit risk, revealing that changes in spending habits can signal financial distress. The conversation culminates with a shocking reminder that fixed-rate loans may turn perilous amid unexpected interest spikes, setting the stage for essential risk management strategies.