Question

What does ALM stand for in the banking industry?

• A. Application Lifecycle Management
• B. Asset Liability Management
• C. Application for Loan Management
• D. Asset Loss Management
• E. None of these

Answer 1

The correct option is B Asset Liability Management

In the banking sector, asset and liability management (often abbreviated ALM) is the practice of managing risks that arise due to mismatches between the assets and liabilities. It is the management of structure of balance sheet (liabilities and assets) in such a way that the net earnings from interest is maximized within the overall risk preference.