Asset-Liability Management as a

Risk Management Tool in Commercial

Banks in India
G Suresh* and P Arun Krishnan**

Amidst increased volatility in the domestic financial market as well as foreign market and
increased competition among the commercial banks, Asset-Liability Management (ALM)
has emerged as an important tool. The liberalized credit policy of the Indian financial
market has brought pressure on the management of banks to maintain liquidity, profitability
and long-term viability. In the recent years, the increased competition among banks has
made it necessary to take up strategic planning as a practice of ALM to survive and grow
in this competitive and risky environment. The present paper studies how ALM is used as
a tool for managing liquidity risk using RBI-prescribed Gap model in four banks, namely,
HDFC Bank, ICICI Bank, Punjab National Bank and State Bank of India.

Introduction
In today’s uncertain economic conditions, risk management has a key role to play in modern
banking. Commercial banks are exposed to various risks in their daily course of business, which
might be either financial or non-financial like credit, interest rate, foreign exchange rate, liquidity,
equity price, commodity price, legal, regulatory, reputational, operational, etc. (Lonkar, 2003).
Banks are on the verge of taking stringent actions to prepare themselves for facing longer-term
changes. They also are required to meet the new requirements and demands of customers due
to the change in customer needs, preferences and technologies. The actions taken should keep
up with the evolution of newer risks arising out of the aforesaid reasons.
As mentioned earlier, management of risk is one of the major challenges faced by every
bank. Hence Asset-Liability Management (ALM) is of great importance to commercial banks.
Risk management in commercial banks has witnessed substantial changes over the past decade.
The regulations which the banks were required to follow as a result of the global financial crisis
as well as the aftereffects of the same have triggered a wave of change in risk functions (Härle
et al., 2015). Further, the increased financial volatility, the current regulatory initiatives and
government interventions also lead the banks to more complex situations.
The Indian money/financial market gained unavoidable momentum and pace over the past
years due to the financial reforms of 1991. Since then many significant changes have been
introduced in the Indian financial system. Interest rates in the banking system have been

* Assistant Professor, School of Commerce, CMS College of Science and Commerce, Coimbatore,
Tamil Nadu, India. E-mail: gsureshsusi@gmail.com
** Research Scholar, School of Commerce, CMS College of Science and Commerce, Coimbatore, Tamil Nadu,
India; and is the corresponding author. E-mail: arunpulivelil@gmail.com

© 2018 IUP. AllManagement

Asset-Liability Rights Reserved.
as a Risk Management Tool in Commercial Banks in India 21
liberalized very substantially compared to the situation prevailing before 1991, when the Reserve
Bank of India (RBI) controlled the rates payable on deposits of different maturities and also the
rates which could be charged for bank loans which varied according to the sector of use and
also the size of the loan. Interest rates on time deposits were decontrolled in a sequence of steps
beginning with longer term deposits and the liberalization was progressively extended to deposits
of shorter maturity. With effect from October 1997, interest rates on all time deposits, including
15-day deposits, have been freed. Only the rate on savings deposits remains controlled by RBI.
Lending rates were similarly freed in a series of steps. RBI now directly controls only the interest
rate charged for export credit, which accounts for about 10% of commercial advances (Ahluwalia,
2000) leading to high competition. It also made the management of risk more important. This
tough competition leads the management to maintain spreads, profitability and viability, due
to increased volatility in both domestic and international interest and exchange rates. Liquidity
risk management was not considered as a challenge due to the surplus liquidity of Indian
financial system (Goyal and Nag, 2017). In the Indian banking system, the deposit growth was
phenomenal and the credit offtake was negligible.
But in the past few years, it has been noticed that the growth of loans from structured
commercial banks has changed. The loans from commercial banks have far exceeded their
deposits in some situations leading to changes in the liquidity situations (Das and Nayak,
2016). These situations have led to the growth of Non-Performing Assets (NPA) in commercial
banks too, which needs to be addressed through some strategic perspective. As per the CARE
rating, as of Quarter 1 (Q1) of FY18, after considering 38 banks as sample, the total NPA
increased by 34.2% on yearly basis. It was also observed that when compared with June 2016,
NPA ratio increased to 10.21% from 8.42%, which is the highest in the last six quarters. As of
June 2017, total NPA amounted to 829,338 cr which is an increase of around 16.6% which
is alarming.1
ALM is concerned with the managing of various risks arising out of mismatches between
the assets and liabilities (loans and advances) of the commercial banks. ALM acts as an
effective tool to manage the interest rate risks and liquidity risks faced by various commercial
banks, other financial institutions, etc., which are exposed to various risks, namely, the risks
associated with assets, interest rates, currency exchange risks, etc. (Madhusudana Rao, 2017).
ALM represents the idea of proper financial management which includes risk management
also, for which banks can form their own risk indicators as per their requirements, their business
profile for better monitoring and management of risks. Here ALM acts as the backbone for
proper risk management and financial planning, through which it indicates to the top management
various information relating to the current risk profile, the impact of various decisions, and also
information relating to the impact of current financial decisions on future risk profiles, which
will help the management to choose the best course of action as per their needs and requisition.
ALM is an unavoidable course of action or activity a bank needs to perform, which also
helps in determining the structure of the balance sheet of the bank for influencing net income,
1
http://www.thehindubusinessline.com/money-and-banking/18-psbs-among-top-20-banks-with-highest-gross-
npa-ratios-care-ratings/article9821624.ece

22 The IUP Journal of Bank Management, Vol. XVII, No. 1, 2018

return in equities and assets, etc. The ALM principles are significant in this point. ALM also
coordinates management of assets and liabilities through controlling the gap between Rate
Sensitive Assets (RSA) and Rate Sensitive Liabilities (RSL).
ALM is considered as a tool that helps the management in taking decisions from a more
informative framework. ALM as a tool enables the management to take better business decisions
keeping in mind all the risks that their bank is exposed to, along with proper measures to
manage these risks. The increased importance of risk management and practices in banks
increased the importance of ALM; hence the concept of ALM is getting importance among the
academic and policy researchers in the recent years. Though there are a number of studies on
the concept of ALM, it is necessary to review earlier strategies and modify them according to
the changing market conditions and risk perspectives. Hence the present study focuses on how
the Indian commercial banks practice ALM in particular with liquidity risk management.

Literature Review
For measuring, monitoring, and managing the market risks, that is, liquidity risk, interest rate
risk and exchange rate risk of a bank, ALM is considered as a comprehensive and dynamic
framework. ALM should be closely related to the bank policies and strategies as it affects the
risk profile of the bank. As a framework, ALM should be built along with sound methodology
and also considering human and technological infrastructure. The ALM framework should be
supported by the banks’ management, boards’ risk policies and tolerance limits. The framework
should always coincide with the risk objectives of the bank as ALM revolves around proper
planning and efficient handling of various kinds of risks which they are prone to, namely, credit
or default risk, interest rate risk, and liquidity risk, to mention a few (Patheja, 2005; as quoted
in Arora et al., 2007).
The evolution of ALM dates back to the early 1980s (Roy, 2005). As per their own
requirements, banks and other financial entities increasingly use ALM techniques as a tool to
manage their risks, which leads to the development of various techniques of ALM. Thus,
today, the scope of ALM activities has widened. Today, ALM departments are addressing (non-
trading) foreign exchange risks as well as other risks. Also, the ALM technique is now applied to
non-financial firms also. Different corporations use ALM techniques to address interest-rate
exposures, liquidity risk, and foreign exchange risk. They also use the ALM-related techniques
to address commodities risks. It can be therefore understood that ALM techniques have got
much wider scope and will continue its growth, playing important role in future in managing
volume, mix, maturity, rate sensitivity, quality, and liquidity of the assets and liabilities so as to
earn a sufficient and acceptable return on the portfolio.
This dynamic feature of ALM has attracted many researchers to carry out different studies
in ALM, where most of the studies focused on its conceptual aspects, whereas there were
studies focusing on various other aspects of ALM such as a tool for managing risks, its applicability
as a strategic balance sheet management tool considering different risks caused by changes in
the interest rates, exchange rates, and liquidity position of the bank (Mehta, 2003; as quoted in
Arora et al., 2007), role, structure and importance of ALCO Committee (Baker, 1997), RBI

Asset-Liability Management as a Risk Management Tool in Commercial Banks in India 23

guidelines relating to the interest rate and liquidity risk management systems (Khan, 2004), and
the importance of ALM as a tool for financial planning (Pirbhai, 2005). Mehta (2003) explains
the major changes that took place in ALM practices; also he discusses the increased importance
of ALM practices due to the changes in the operating environment of financial institutions. Roy
(2005) highlights the importance of ALM in the light of the post-banking reform scenario in
India like interest rate deregulation, private banks, information technology revolution in banking
industry and the usage of new financial tools. Attempting to find out the relationship between
capital adequacy ratio and the behavior of banks by decomposing the financial statements,
Bagchi (2005) states that banks utilized their assets and liabilities to achieve higher capital
adequacy ratios, which were not after proper planning, except in some exceptional cases. It
was also observed that assets reorganizations were more pronounced than the reorganization
of the liabilities. Elshal (2005) analyzes the concept of ALM in the context of Islamic banking
taking Abu Dhabi Islamic Bank as the base for the study.
Ghosh and Das (2005), through an empirical analysis, examine the existence of “market
discipline” in the Indian banking scenario. Vaidya and Shahi (2005) explain the importance of
liquidity risk as well as interest rate risk management in a bank’s balance sheet. They also
discuss different methods to measure various risks and the challenges in the Indian banking
scenario in managing these risks through an ALM system. Ranjan and Nallari (2005) focus on
the ‘portfolio-matching’ behavior of Indian banks by establishing the relationship between
assets, liabilities and ownership of financial institutions. In his study, Chandrasekaran (2005)
emphasizes the importance of risk management in banking institutions in the globalization era.
Patnaik and Shah (2004) point out the responsibility of the banks to measure and manage the
rate sensitivity position for ensuring the long-run earning capacity of the bank. Smant (2005)
explain different alternative approaches for proper risk management like the Gap or mismatch
analysis, balance sheet or market value approach, duration model, Value at Risk (VaR) approach
and scenario analysis. Holmer (2005), based on a case study on integrated ALM, discusses the
importance of integrated ALM as a new management perspective. Arora et al. (2007) discuss
the ALM practices in commercial banks in India based on duration or Gap analysis and point
out that in the era of globalization, ALM is necessary for meeting the challenges and risks
arising out of maturity rate mismatches. Ramya (2014) discusses the impact of the prevailing
ALM system in the banking industry. The study brings out the importance of making appropriate
decisions for efficient management of assets and liabilities of banks and mitigating the NPA in
the banks.
However, this paper aims at finding out the liquidity gap through duration gap analysis.
Even though some studies have been carried out using this technique, no study has been
conducted in recent years using the recent data.

Data and Methodology

The study analyzes the ALM practices followed by four banks, having different ownerships and
operating pattern, selected from two different sectors of the Indian economy, that is, two each
from private sector and public sector, based on profitability. Foreign banks and cooperative

24 The IUP Journal of Bank Management, Vol. XVII, No. 1, 2018

banks were not included in the study as they follow their own policies for risk management. The
banks chosen for the study include HDFC Bank, ICICI Bank, State Bank of India (SBI) and
Punjab National Bank (PNB). Though there are various methods like VaR stress testing,
simulation, ratio analysis and scenario analysis available for the analysis, this study is limited
to Gap analysis because of constraints like non-availability of confidential data which is not
provided by the banks; for example, the data required for making ‘statement of structural
liquidity’ and ‘statement of short-term dynamic liquidity’ are not available in the public domain.
Though for the research purposes, personal and telephonic interviews with bank officials
provided an insight into the practices followed by the banks, the current study is purely based on
the secondary data. Data was collected from various sources including Statistical Tables Relating
to Banks in India, various reports on Trend and Progress of Banking in India and RBI Bulletin
(published by RBI), Annual Reports of the sample banks, websites of RBI and other banks and
databases like Prowess. The period of study ranged from financial years 2007-08 to 2016-17.

Gap Model
For the detection and assessment of the extent of mismatch in ALM, various tools can be
employed. For assessing the interest rate risk, the study has used Gap analysis, which is a
widely used tool for managing the interest rate risk. Assets and liabilities on the basis of their
sensitivity to interest rate fluctuations are classified into different maturity buckets.
By calculating the Gap over different time intervals on the given date, the Gap or mismatch
risk can be measured. Gap analysis measures mismatches between RSL and RSA (including
off-balance sheet positions). An asset or liability is generally considered as rate-sensitive if:
• Within the time interval under consideration, there is a cash flow;
• The interest rate resets/reprices contractually during the interval;
• RBI changes the interest rates (i.e., interest rates on savings bank deposits, Differential
Rate of Interest [DRI] advances, export credit, refinance, and Cash Reserve Ratio
[CRR] balance) in cases where interest rates are administered; and
• It is contractually pre-payable or withdrawable before the stated maturities.
The Gap is the difference between RSA and RSL for each time bucket. From the analysis,
if it is observed that there is a positive Gap, it shows that RSA are more than RSL, and on the
other hand if the Gap is negative, the bank has more RSL compared to RSA. The Gap report
shows whether the bank benefits from rising interest rates by having a positive Gap (RSA >
RSL) or whether it benefits from declining interest rates by a negative Gap (RSL > RSA). The
Gap is used as a measure of interest rate sensitivity. Although it has some advantages, it is
subject to some limitations.
The time value of money is not taken care under the Gap analysis. The Gaps have been
identified in the following time buckets:
• 1-14 days
• 15- 28 days

Asset-Liability Management as a Risk Management Tool in Commercial Banks in India 25

 • 29 days-3 months
• 3-6 months
• 6 months-1 year
• 1-3 years
• 3- 5 years
• Above 5 years
Traditionally, banks in India have not been following this maturity structure. They had been
only reflecting total assets and total liabilities from which it is difficult to say if there is any
liquidity mismatch giving rise to liquidity risk or Gap between RSA and RSL giving rise to
interest rate risk.
Gap = RSA – RSL

Gap and the Net Interest Income (NII)

The difference between interest income and interest expense is termed as NII. Banks need to
closely watch and monitor the Gap so as to keep its NII immune.
NII = Interest Income – Interest Expenses
Changes in interest rates only affect the RSA and RSL over the planning horizon. The fixed
rate assets and fixed rate liabilities are not affected by the changes in interest rate. Thus,

NII = (RSA – RSL) * r

where

r = Change in interest rate

Since Gap has been earlier expressed as a difference between RSA and RSL, NII can be
expressed as:

NII = Gap * r

If for a cumulative maturity period, interest-bearing liabilities exceed interest-earning assets,

it will lead to a negative or liability-sensitive Gap, which means that more liabilities reprice than
assets. In such situations, a decrease in interest rates should improve the net interest rate
spread in the short term, as deposits are rolled over at lower rates before the corresponding
assets. On the other hand, an increase in interest rates lowers earnings by narrowing or eliminating
the interest spread. A positive or asset-sensitive Gap occurs when interest-earning assets exceed
interest-bearing liabilities for a specific or cumulative maturity period, that is, more assets
reprice than liabilities. In this situation, a decline in the interest rates should lower or eliminate
the net interest rate spread in the short term, as assets are rolled over at lower rates before the
corresponding liabilities. An increase in interest rates should increase the net interest spread
(Arora et al., 2007).

26 The IUP Journal of Bank Management, Vol. XVII, No. 1, 2018

Results and Discussion
HDFC Bank
From the analysis of Table A1, it is understood that in the year 2007-08, HDFC Bank shows
negative Gap in the short term, medium term and one of the long term time buckets, i.e.,
1-3 years. It is observed that in the very short term, 6 months to 1 year and very long term bank
shows a positive Gap between the RSA and RSL. This shows that the bank has some better
long term assets when compared to its liabilities. It is observed that in the year 2008-09 both in
the short and long term, bank faces a negative Gap, which shows that there is a fall in short
and long-term investments and lending. It is also found that in the very short term and medium
term, the bank shows a positive gap. In the following years, i.e., 2009-10 and 2010-11, also
there is a negative Gap in the long run and very short term time bucket also shows a negative
Gap. An interesting trend was observed from the financial year 2011-12. There were no negative
mismatches in any of the short or medium-term time buckets. All the medium and short term
time buckets showed a positive Gap which is due to an increase in the short and medium term
loans and investments.

ICICI Bank
From the analysis of Table A2, it is observed that there is a positive Gap in both short and long-
term time buckets, that is, in 1-14 days, 15-28 days in the short run and 3-5 years and above
5 years time buckets in the long run. This implies that ICICI Bank has more RSL in the
medium term when compared to the short and long term. In 2008-09, the same trend continued,
but in 15-28 days time bucket the bank is found to have more RSL than assets. It is also
observed that in the long run, the bank has more RSA than RSL which implies that long-term
advances have considerably increased. The year 2009-10 follows the same pattern as 2008-
09. Here the bank shows a positive gap in the very short term and very long term which means
that it is able to meet the interest and other expenses both in short and long term. But in the
medium term, the bank still has a negative Gap. In the year 2010-11, along with the medium
term time buckets, the very short term time bucket, that is, 1-14 days also shows a negative
Gap. While considering the following years, it is observed that the bank follows a similar trend
in all the years under study. Also, it is noted that from the year 2013-14, for the consecutive
years, the bank has negative gaps in the long run as well as the medium term. This shows that
the long and medium-term RSL are more when compared to the medium and long-term RSA.

Punjab National Bank

From the analysis of interest rate sensitivity of PNB (see Table A3), it is observed that for all the
years under study, except 2015-16 and 2016-17, the bank showed a positive Gap as far as the
long-term time buckets are concerned. This shows that PNB has got a very good long-term
RSA base. Whereas the point to be noted is that in all other short-term buckets, except the year
2008-09, it showed negative interest rate sensitivity. From this, it can be understood that the
bank has less short-term RSA base. While considering the year 2007-08, all the short-term
buckets fall under a negative Gap. The medium and long-term buckets, except
3-6 months, had a positive Gap. In the following year, only the medium and one long-term

Asset-Liability Management as a Risk Management Tool in Commercial Banks in India 27

bucket had a negative Gap which shows that it had more RSA in the short and very long-term
liabilities. In the year 2009-10, there is a negative Gap in almost all buckets, except three time
buckets including one medium term and two long term, viz., 6 months-1 year, 3-5 years and
above 5 years, which showed a positive Gap. All the consecutive years witnessed negative Gap
in the short as well as medium term time buckets in almost all instances.

State Bank of India

The statement of interest rate sensitivity analysis (see Table A4) revealed that the SBI other
than in 2013-14 and 2014-15 always had a positive Gap in long-term time buckets which
shows that in the long run, when compared to the short and medium-terms, SBI had more
RSA than RSL. This could be because of more long-term loans having long-term maturity. It
can also be interpreted that SBI has more long-term loans than the medium and short-term
advances. Unlike other banks under the study, there were not many deviations in the Gap trend
followed over the years under study. The analysis also revealed that in all the time buckets,
except 2008-09, the medium-term RSL were more than the RSA which led to negative Gap in
all the years. While considering the very short-term RSA, assets were more than liabilities when
compared to the assets in medium and long term, which can be understood from the positive
Gap in very short-term time buckets in majority of the years, except 2011-12, 2013-14,
2014-15, 2015-16 and 2016-17.

Conclusion
The study, using the maturity Gap analysis, examined the asset-liability mismatches in the
Indian banks based on two public and two private sector banks to understand the short-term
and long-term liquidity patterns and the strategies in maintaining the liquidity risk. The analysis
showed that over the period of study, the public sector banks, namely, SBI and PNB, hardly
showed any common trend though both the public sector banks showed negative mismatches
in short term as well as the medium term in many instances which needs attention. If the public
sector banks continue to maintain negative gaps in the short run, there are chances to lose their
interest income due to any future increase in the interest rates and vice versa.
The point to be noted is that both these banks had a positive Gap in the long run which is
a kind of positive sign as this positive Gap shows strong long-term deposit and advances base
of the bank. But positive Gaps in the long run alone cannot be interpreted as an absolute
positive result as far as they have short-run negative mismatches. It was observed that both
these banks had higher NPA when compared with private sector banks which might affect
future profitability which is not considered under the study (Table A5). On the other hand,
while considering the private sector banks, HDFC Bank’s RSA shows positive Gap in the short
run in almost all the years which can be considered as a positive sign, though it is alarming that
the bank had more negative Gaps in the long run, which shows that it has low long-term
investment/advances base. ICICI Bank, when compared with all the banks under study, had a
positive Gap in the short run as well as the long run, though in some years it had negative Gap.
Though the private sector banks showed positive Gaps in the short run, they had more negative
mismatches in the long term which expose them to the risk of losing interest income if there is

28 The IUP Journal of Bank Management, Vol. XVII, No. 1, 2018

an increase in interest rates and vice versa. From the analysis, it can be pointed out that there
is a need to tailor-make the short-term and long-term advances considering the higher demand
for short-term as well as long-term credits, matching with the short and long-term deposits
based on the liquidity position of the banking entity.
Scope for Future Research: ALM is something which needs continuous evaluation planning
and follow-up as it is linked with banks’ strategy and practical banking challenges. ALM does
not consider the effect of NPA on the profitability as well as liquidity aspects of the banking
institutions which must be duly taken care of as the NPA in Indian banking scenario is increasing
along with other different risks. It therefore requires continuous assessment evaluation and
control which can be attained only through continuous research which shall enable the entities
functioning in the banking as well as other financial sectors to address the upcoming as well as
prevailing challenges.H

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30 The IUP Journal of Bank Management, Vol. XVII, No. 1, 2018

 Appendix

Table A1: HDFC Bank

Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
2008-March Loans and Advances 60.28 5.56 36.72 50.95 114.48 314.70 39.41 23.28
Investment 156.08 12.14 30.47 33.82 42.93 164.97 20.78 32.74
Deposits 91.59 33.34 66.73 84.82 77.96 566.25 57.68 29.32
Borrowings 17.10 1.06 16.27 7.95 2.21 0.20 2.03 0.00
Gap 107.68 –16.70 –15.80 –8.01 77.23 –86.78 0.48 26.71
Cumulative Gap 107.68 90.97 75.17 67.16 144.39 57.62 58.09 84.80
in cr 1076.75 909.73 751.72 671.63 1443.94 576.17 580.93 848.03
Gap as % to Outflow 99 –49 –19 –9 96 –15 1 91
2009-March Loans and Advances 63.43 5.56 36.72 50.95 114.48 314.70 39.41 23.28
Investment 170.63 11.25 25.40 23.56 41.47 216.19 45.20 54.48
Deposits 103.09 22.89 69.70 74.72 112.82 815.54 148.69 80.67
Borrowings 8.18 0.95 8.36 8.60 0.00 0.15 0.00 0.63
Gap 123 –7 –16 –9 43 –285 –64 –4

Asset-Liability Management as a Risk Management Tool in Commercial Banks in India

Cumulative Gap 123 116 100 91 134 –151 –215 –218
in cr 1227.94 1157.70 998.28 910.19 1341.47 –1506.56 –2147,39 –2182.75
Gap as % to Outflow 110 –29 –20 –11 38 –35 –43 –4
2010-March Loans and Advances 62.30 23.84 131.87 137.28 146.45 552.75 93.73 110.09
Investment 98.01 10.96 30.87 22.74 28.83 235.34 59.07 100.25
Deposits 151.05 19.40 91.73 87.31 139.54 830.75 181.27 172.98

31
32
Appendix (Cont.)

Table A1 (Cont.)
Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
Borrowings 19.75 1.87 7.65 8.50 23.90 4.57 4.14 58.77
Gap –11 14 63 64 12 –47 –33 –21
Cumulative Gap –11 3 66 131 142 95 63 41
in cr –105.03 30.28 663.87 1305.95 1424.35 952.08 625.96 411.81
Gap as % to Outflow –6 64 64 67 7 –6 –18 –9
2011-March Loans and Advances 80.81 53.66 216.85 152.15 194.95 644.14 119.54 137.74
Investment 77.66 22.33 52.03 41.37 42.49 283.26 73.61 116.54
Deposits 187.18 48.06 195.99 104.81 76.05 1056.87 214.45 202.46
Borrowings 13.82 12.69 16.97 22.67 2.97 0.89 16.16 57.77
Gap –42.53 15.25 55.92 66.03 158.42 –130.37 –37.46 –5.94
Cumulative Gap –42.53 –27.28 28.64 94.67 253.09 122.72 85.26 79.32
in cr –425.27 –272.79 286.40 946.71 2530.87 1227.17 852.58 793.16
Gap as % to Outflow –21 25 26 52 200 –12 –16 –2
2012-March Loans and Advances 119.24 56.03 216.89 156.80 211.02 877.36 150.87 165.98
Investment 234.30 21.20 45.89 61.18 54.04 302.83 38.22 217.16
Deposits 152.68 67.08 211.92 198.13 96.24 1099.66 8.65 632.71
Borrowings 30.80 1.68 46.24 17.36 10.18 24.74 25.02 82.44
Gap 170 8 5 2 159 56 155 –332
Cumulative Gap 170 179 183 186 344 400 556 224

The IUP Journal of Bank Management, Vol. XVII, No. 1, 2018

 Appendix (Cont.)

Table A1 (Cont.)
Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3 m-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
in cr 1700.58 1785.36 1831.57 1856.46 3442.98 4000.89 5555.16 2235.08
Gap as % to Outflow 93 12 2 1 149 5 462 –46
2013-March Loans and Advances 14548.93 6939.38 22673.07 22676.59 25700.78 110569.48 18146.42 18,465.99
Investment 20692.97 2692.10 7566.13 7183.02 7752.56 34347.67 5051.12 26,328.03
Deposits 22703.86 7288.12 18957.09 20887.03 17959.52 126568.53 5224.33 76,658.50
Borrowings 217 9.02 565.12 2980.61 4029.55 999.08 4028.92 6474.45 11,749.85
Gap 10,359 1,778 8,302 4,943 14,495 14,320 11,499 –43,614
Cumulative Gap 10,359 12,137 20,439 25,382 39,877 54,196 65,695 22,081
in cr 103,590.20 121,372.60 204,387.60 253,817.90 398,765.30 541,962.30 656,949.90 220,806.60
Gap as % to Outflow 42 23 38 20 76 11 98 –49
2014-March Loans and Advances 17274.78 8278.80 34841.80 24585.12 29450.83 143717.35 22597.09 22,254.50
Investment 25165.75 2872.83 5527.87 9535.79 7278.14 35235.61 6342.03 28,993.05
Deposits 28031.45 10527.24 18492.97 26127.75 18568.22 167127.92 9377.39 89084.54

Asset-Liability Management as a Risk Management Tool in Commercial Banks in India

Borrowings 2339.64 458.95 4478.22 1210.06 2525.06 11053.00 8442.91 8931.15
Gap 12069 165 17398 6783 15636 772 11119 –46768
Cumulative Gap 12069 12235 29633 36416 52052 52824 63943 17175
in cr 120694.40 122348.80 296333.60 364164.60 520521.50 528241.90 639430.10 171748.70
Gap as % to Outflow 40 2 76 25 74 0 62 –48

33
34
Appendix (Cont.)

Table A1 (Cont.)
Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
2015-March Loans and Advances 20860.24 11172.07 38323.22 26873.66 38013.90 173512.31 28247.41 28492.22
Investment 43005.27 4951.89 13319.41 9767.54 16563.28 39633.60 6411.66 32807.30
Deposits 32476.39 9196.91 22948.57 24432.11 31266.55 203410.51 10386.61 116677.99
Borrowings 3318.30 1278.81 7222.95 1911.49 2188.15 14461.86 2875.00 11957.00
Gap 28071 5648 21471 10298 21122 –4726 21397 –67335
Cumulative Gap 28071 33719 55190 65488 86610 81884 103281 35946
in cr 280708.20 337190.60 551901.70 654877.70 866102.50 818837.90 1032812.50 359457.80
Gap as % to Outflow 78 54 71 39 63 –2 161 –52
2016-March Loans and Advances 69617.52 20239.90 43477.82 34648.74 61862.67 207986.19 40680.30 33,700.17
Investment 48803.67 12010.84 22476.07 11515.93 13973.17 45249.83 3515.43 26566.79
Deposits 57522.20 12873.38 36815.06 39301.81 78240.13 222890.76 12361.51 97194.62
Borrowings 11054.97 2669.86 8342.60 3960.08 10046.25 8997.05 1767.55 13864.55
Gap 49844 16708 20796 2903 –12451 21348 30067 –50792
Cumulative Gap 49844 66552 87348 90251 77800 99148 129215 78423
in cr 498440.20 665515.20 873477.50 902505.30 777999.90 991482.00 1292148.70 784226.60
Gap as % to Outflow 73 107 46 7 –14 9 213 –46
2017-March Loans and Advances 31092.80 23847.16 45891.02 44683.49 63909.96 246074.88 55114.69 44314.20
Investment 52743.60 8019.55 21529.80 13880.35 20057.43 60186.46 7944.59 30601.56
Deposits 54276.63 14231.55 47503.80 43,975.61 69790.72 287584.72 13494.82 112805.81

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 Appendix (Cont.)

Table A1 (Cont.)

Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
Borrowings 5184.10 3545.16 7631.14 6431.74 16178.33 12543.50 6319.00 16165.00

Gap 24376 14090 12286 8156 –2002 6133 43245 –54055

Cumulative Gap 24376 38466 50752 58908 56906 63040 106285 52230

in cr 243756.70 384656.70 507515.50 589080.40 569063.80 630395.00 1062849.60 522299.10

Gap as % to Outflow 41 79 22 16 –2 2 218 –42

Source: Annual Reports

Table A2: ICICI Bank

Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
2008-March Loans and Advances 9329.99 2785.74 15510.73 15641.50 26020.74 77324.34 33180.81 45822.21
Investment 14413.88 10292.66 11068.13 10627.50 17167.50 20811.51 4657.78 22415.40

Asset-Liability Management as a Risk Management Tool in Commercial Banks in India

Deposits 15041.51 10510.53 37731.56 35345.30 59659.99 81211.94 3404.73 1525.53
Borrowings 1894.97 540.70 3747.64 9878.21 11284.74 17672.75 17697.48 2931.94
Gap 6807.39 2027.17 –14900.34 –18954.50 –27756.49 –748.84 16736.38 63780.14
Cumulative Gap 6807.39 8834.56 –6065.78 –25020.30 –52776.74 –53525.58 –36789.20 26990.94
in cr 68073.90 88345.60 –60657.80 –250203.00 –527767.40 –535255.80 –3678920.00 269909.40

35
36
Appendix (Cont.)

Table A2 (Cont.)
Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
Gap as % to Outflow 40.19 18.34 –35.92 –41.91 –39.12 –0.76 79.31 1430.86
Marginal Gap 1126803
2009-March Loans and Advances 7700.26 1854.73 9597.56 11239.7 22077 88737.6 42354.56 34749.45
Investment 11638.77 4561.18 10103.88 7404.59 9970.99 26052.72 2585.01 30741.17
Deposits 15961.36 8038.88 38148.77 35608.9 45831.37 71362.3 1436.84 159.42
Borrowings 1796.07 2019.77 4467.62 5899.98 7664.82 24044.6 16528.70 4902.13
Gap 1581.6 –3642.74 –22914.95 –22864.60 –21448.20 19383.42 26974.03 60429.07
Cumulative Gap 1581.6 –2061.14 –24976.09 –47840.70 –69288.87 –49905.45 –22931.42 37497.65
in cr 15816.0 –206114.00 –249760.90 –478407 –692888.70 –499054.50 –22931.42 374976.50
Gap as % to Outflow 8.91 –36.21 –53.77 –55.08 –40.09 20.32 150.14 1193.88
2010-March Loans and Advances 3150.74 2010.47 13179.94 14875.20 24806.69 71344.51 29221.62 22616.45
Investment 18239.08 7407.06 9892.60 7193.17 9733.39 29589.93 3941.36 34896.21
Deposits 18771.81 5041.90 26594.40 18874.40 27668.61 103099.27 1550.31 415.91
Borrowings 1277.10 1121.34 8048.07 7459.79 7672.44 30298.74 8836.11 25949.98
Gap 1340.91 3254.29 –11569.93 –4265.83 –800.97 –32463.57 22776.56 31146.77
Cumulative Gap 1340.91 4595.20 –6974.73 –11240.56 –12041.53 –44505.10 –21728.54 9418.23
in cr 13409.10 45952.0 –69747.30 –112406 –120415.30 –445051 –217285.40 94182.30
Gap as % to Outflow 6.69 52.80 –33.40 –16.20 –2.27 –24.34 219.29 118.13

The IUP Journal of Bank Management, Vol. XVII, No. 1, 2018

 Appendix (Cont.)

Table A2 (Cont.)
Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
2011-March Loans and Advances 3680.05 2605.84 14917.08 19049.1 26074.05 88920.11 34260.31 26859.31
Investment 9215.11 9275.43 9688.78 7664.91 12066.65 35973.62 10690.77 40110.68
Deposits 164153.7 6462.51 21272.19 17871.7 37453.42 117719.69 3394.66 5012.57
Borrowings 1121.16 2328.47 9232.83 10823 13882.88 22902.21 11092.02 38171.72
Gap –4641.37 3090.29 –5899.16 –1980.64 –13195.6 –15728.17 30464.40 23785.70
Cumulative Gap –4641.37 –1551.08 –7450.24 –9430.88 –22626.48 –38354.65 –7890.25 15895.45
in cr –46413.7 –15510.8 –74502.4 –94308.8 –226264.8 –383546.5 –78902.5 158954.5
Gap as % to Outflow –26.47 35.15 –19.34 –6.90 –25.70 –11.18 210.29 55.08
2012-March Loans and Advances 3397.09 2010.47 13179.94 14875.2 24806.69 71344.51 29221.62 22616.45
Investment 30252.02 9572.35 7739.24 8762.79 14946.67 24524.42 15292.3 48470.25
Deposits 11914.97 9713.44 27313.18 28825.5 45211.28 69012.66 22855.03 40653.94
Borrowings 17708.67 2684.14 8093.76 14160.7 22362.24 17352.05 19714.6 38088.8
Gap 4025.47 –814.76 –14487.76 –19348.1 –27820.16 9504.22 1944.29 –7656.04

Asset-Liability Management as a Risk Management Tool in Commercial Banks in India

Cumulative Gap 4025.47 3210.71 –11277.05 –30625.2 –58445.35 –48941.13 –46996.84 –54652.88
in cr 40254.7 32107.1 –112770.5 –306252 –584453.5 –489411.3 –469968.4 –546528.8
Gap as % to Outflow 13.59 –6.57 –40.92 –45.01 –41.17 11.00 4.57 –9.72
2013-March Loans and Advances 84942.4 37185.2 170166.2 1752.55 287499 931739.2 399127.2 379875.8
Investment 33185.19 11781.27 9870 7724.21 15840.55 24187.23 21255.2 47549.95
Deposits 18042.62 7877.61 30301.8 26548.1 45908.57 44248.86 60062.39 59623.71

37
38
Appendix (Cont.)

Table A2 (Cont.)
Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
Borrowings 18822.96 827.12 8490.36 12668.6 158,589.4 208,659 232,053.6 446,022.1
Gap 812,62.01 402,61.74 1,412,440.4 1,437,622 2,415,720.4 8,908,116.7 3,371,146.5 3,231,998.3
Cumulative Gap 812,620.1 121,523.75 2,627,677.9 4,065,299.9 6,481,020.3 15,389,137 18,760,283.5 21,992,281.8
in cr 812,620.1 1,215,237.5 262,767,78 4,065,300 6,481,020 15,389,137 18,760,284 21,992,282
Gap as % to Outflow 220.43 462.53 364.10 366.58 391.10 1,368.06 404.86 310.10
2014-March Loans and Advances 3421.62 4566.54 20098.38 25300.2 35804.77 129720.39 59685.97 60104.75
Investment 29448.19 10241.83 7432.11 11012.2 21824.5 22273.57 24334.94 50454.46
Deposits 23601.96 8579.07 23202.77 24337.1 42754.87 49996.6 81729.08 77712.18
Borrowings 8204.43 800.67 9957.96 16535 19735.37 30669.81 19121.89 49733.89
Gap 1063.42 5428.63 –5630.24 –4559.71 –4860.97 71327.55 –16830.06 –16886.86
Cumulative Gap 1063.42 6492.05 861.81 -3697.9 –8558.87 62768.68 45938.62 29051.76
in cr 10634.2 64920.5 8618.1 -36979 –85588.7 627686.8 459386.2 290517.6
Gap as % to Outflow 3.34 57.88 –16.98 –11.16 –7.78 88.42 –16.69 –13.25
2015-March Loans and Advances 5530.82 6350.93 24040.92 27327.8 40385.3 156319.95 59205.16 68361.2
Investment 3613.25 11219.25 6895.26 10353.7 24284.62 18631.84 27431.44 51631.45
Deposits 23696.31 9523.97 2393.16 26532.8 33502.07 53333.57 97697.2 93345.22
Borrowings 10940.67 2992.37 9404.26 15716.4 26460.85 38430.93 21796.67 46675.24
Gap –25492.91 5053.84 19138.76 -4567.69 4707 83187.29 –32857.27 –20027.81
Cumulative Gap –25492.91 –20439.07 –1300.31 –5868 –1161 82026.29 49169.02 29141.21

The IUP Journal of Bank Management, Vol. XVII, No. 1, 2018

 Appendix (Cont.)

Table A2 (Cont.)
Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1 y-3 y 3-5 y Above 5 y
in cr –254929.1 –204390.7 –13003.1 –58680 –11610 820262.9 491690.2 291412.1
Gap as % to Outflow –73.60 40.38 162.23 –10.81 7.85 90.65 –27.50 –14.30
2016-March Loans and Advances 7761.71 6621.79 26294.39 29377.5 54482.22 145628.49 71691.86 93405.94
Investment 38694.48 9278.41 6613.9 8306.51 14261.98 15482.21 27819.84 39954.46
Deposits 23991.85 6401.77 29747.82 26249.8 53683.64 45390.68 118552.5 117407.69
Borrowings 5886 2214.8 10316 13203.2 40144.53 42215.8 40417.61 20409.46
Gap 16578.34 7283.63 –7155.53 –1768.92 –25083.97 73504.22 –59458.38 -4456.75
Cumulative Gap 16578.34 23861.97 16706.44 14937.5 –10146.45 63357.77 3899.39 –557.36
in cr 165783.4 238619.7 167064.4 149375 –101464.5 633577.7 38993.9 –5573.6
Gap as % to Outflow 55.49 84.53 –17.86 –4.48 –26.73 83.90 –37.40 –3.23
2017-March Loans and Advances 8310.16 8661.49 31567.12 32260.3 51714.36 12812.58 92453.72 110852.33
Investment 31306.8 7839.78 9259.48 9217.17 10579.22 20800.69 28599.12 43904.29
Deposits 55396.57 7727.51 30837.02 35944.5 32621.14 49701.73 139329.3 138481.27
Borrowings 2304.9 8037.74 7016.07 6770.28 23164.17 46843.52 21553.99 31865.49

Asset-Liability Management as a Risk Management Tool in Commercial Banks in India

Gap –18084.51 736.02 2973.51 –1237.26 6508.27 –62931.98 –39830.48 –15590.14
Cumulative Gap –18084.51 –17348.49 –14374.98 –15612.2 –9103.97 –72035.95 –111866.4 –127456.57
in cr –180845.1 –173484.9 –143749.8 –156122 –91039.7 –720359.5 –1118664 –1274565.7
Gap as % to Outflow –31.34 4.67 7.86 –2.90 11.67 –65.18 –24.76 –9.15
Source: Annual Reports

39
40
Appendix (Cont.)

Table A3: Punjab National Bank

Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
2008-March Loans and Advances 8,333.32 3,198.21 6,761.40 5,899.85 11,310.24 54,597.30 13,889.11 15,512.14
Investment 363.05 783.81 122.04 1,648.69 2,720.24 8,686.87 8,819.48 30,662.73
Deposits 7,264.21 4,294.72 9,729.79 6,031.64 25,454.66 73,253.88 3,985.81 36,442.51
Borrowings 2,826.43 656.06 651.89 597.03 242.55 442.13 19.66 10.81
Gap –1,394.27 –968.76 –3,498.24 919.87 –11,666.73 –10,411.84 18,703.12 9,721.55
Cumulative Gap –1,394.27 –2,363.03 –5,861.27 –4,941.40 –16,608.13 –27,019.97 –8,316.85 1,404.70
in cr –13,942.70 –23,630.30 –58,612.70 –49,414.00 –166,081.30 –270,199.70 –83,168.50 14,047.00
Gap as % to Outflow –13.82 –19.57 –33.70 13.88 –45.40 –14.13 466.94 26.67
2009-March Loans and Advances 11,216.53 5,356.90 9,196.65 9,100.17 1,926.42 64,585.00 18,754.76 16,664.58
Investment 1,097.74 888.69 2,037.16 2,252.52 2,450.11 7,119.31 11,273.97 36,641.15
Deposits 4,919.23 4,098.11 10,275.85 20,947.20 26,693.26 87,068.10 2,237.64 48,521.11
Borrowings 512.97 50.72 729.59 1,392.93 54.16 976.88 86.62 570.49
Gap 6,882.07 2,096.76 228.37 –10,987.44 –22,370.89 –16,340.67 27,704.47 4,214.13
Cumulative Gap 6,882.07 8,978.83 9,207.20 –1,780.24 –24,151.13 –40,491.80 –12,787.33 –8,573.20
in cr 68,820.70 89,788.30 92,072.00 –17,802.40 –241,511.30 –404,918.00 –127,873.30 –85,732.00
Gap as % to Outflow 126.69 50.54 2.08 –49.18 –83.64 –18.56 1,191.97 8.58
2010-March Loans and Advances 10,524.58 4,205.28 7,609.84 10,877.95 24,836.45 84,440.35 22,238.30 21,868.46
Investment 711.64 1,354.63 1,920.97 3,517.11 2,496.84 9,148.75 10,708.30 48,199.46
Deposits 15,168.17 5,815.93 21,104.07 23,723.88 25,391.17 103,225.83 1,893.93 53,006.82

The IUP Journal of Bank Management, Vol. XVII, No. 1, 2018

 Appendix (Cont.)

Table A3 (Cont.)
Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
Borrowings 3,659.50 382.75 1,973.75 1,024.68 483.97 1,204.54 843.05 9,690.13
Gap –7,591.45 –638.77 –13,547.01 –10,353.50 1,458.15 –10,841.27 30,209.62 7,370.97
Cumulative Gap –7,591.45 –8,230.22 –21,777.23 –32,130.73 –30,672.58 –41,513.85 –11,304.23 –3,933.26
in cr –75,914.50 –82,302.20 –217,772.30 –321,307.30 –306,725.80 –415,138.50 –113,042.30 –39,332.60
Gap as % to Outflow –40.32 –10.30 –58.70 –41.83 5.64 –10.38 1,103.76 11.76
2011-March Loans and Advances 19,723.52 6,726.54 11,127.40 13,277.89 31,700.45 109,496.67 23,555.58 26,498.62
Investment 362.23 668.97 7,617.13 1,541.26 2,518.16 10,302.92 14,558.75 57,943.63
Deposits 20,477.88 8,583.24 36,519.00 10,665.43 38,411.28 124,030.55 2,768.74 71,442.61
Borrowings 8,013.95 0.00 2,604.25 3,854.03 1,405.27 4,576.18 957.87 10,178.14
Gap –8,406.08 –1,187.73 –20,378.72 299.69 –5,597.94 –8,807.14 34,387.72 2,821.50
Cumulative Gap –8,406.08 –9,593.81 –29,972.53 –29,672.84 –35,270.78 –44,077.92 –9,690.20 –6,868.70
in cr –84,060.80 –95,938.10 –299,725.30 –296,728.40 –352,707.80 –440,779.20 –96,902.00 –68,687.00
Gap as % to Outflow –29.50 –13.84 –52.09 2.06 –14.06 –6.85 922.76 3.46

Asset-Liability Management as a Risk Management Tool in Commercial Banks in India

2012-March Loans and Advances 24,512.56 6,151.19 12,000.26 9,310.24 50,070.74 134,808.53 27,842.53 29,078.72
Investment 1,021.46 248.55 11,355.08 3,020.94 3,378.19 13,208.57 18,492.21 72,422.26
Deposits 18,154.79 4,594.39 31,685.90 38,895.07 56,238.31 143,044.85 3,211.74 83,763.43
Borrowings 13,028.56 1,421.45 290.76 5,686.28 1,032.76 5,166.13 1,969.26 8,669.07
Gap –5,649.33 383.90 –8,621.32 –32,250.17 –3,822.14 –193.88 41,153.74 9,068.48
Cumulative Gap –5,649.33 –5,265.43 –13,886.75 –46,136.92 –49,959.06 –50,152.94 –8,999.20 69.28

41
42
Appendix (Cont.)

Table A3 (Cont.)
Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
in cr –56,493.30 –52,654.30 –138,867.50 –461,369.20 –499,590.60 –501,529.40 –89,992.00 692.80
Gap as % to Outflow –18.12 6.38 –26.96 –72.34 –6.67 –0.13 794.32 9.81
2013-March Loans and Advances 24,969.96 3,051.88 22,195.52 17,478.97 78,886.53 61,658.75 30,079.60 73,533.68
Investment 632.71 241.00 4,860.01 5,084.45 3,369.32 16,498.34 19,932.98 79,823.80
Deposits 15,608.27 4,456.34 25,977.21 28,405.67 34,249.07 158,031.70 2,396.47 122,435.33
Borrowings 4,450.21 1,558.87 10,123.83 7,770.59 4,321.49 1,073.18 4,374.17 5,948.58
Gap 5,544.19 –2,722.33 –9,045.51 –13,612.84 43,685.29 –80,947.79 43,241.94 24,973.57
Cumulative Gap 5,544.19 2,821.86 –6,223.65 –19,836.49 23,848.80 –57,098.99 –13,857.05 11,116.52
in cr 55,441.90 28,218.60 –62,236.50 –198,364.90 238,488.00 –570,989.90 –138,570.50 111,165.20
Gap as % to Outflow 27.64 –45.26 –25.06 –37.63 113.26 –50.88 638.67 19.45
2014-March Loans and Advances 42,987.43 7,808.87 24,228.29 15,117.06 33,052.27 167,152.90 25,928.51 32,993.80
Investment 0.00 518.71 4,740.50 679.83 7,740.42 19,238.88 23,357.34 88,698.82
Deposits 22,202.83 7,955.69 46,200.77 34,258.24 61,964.76 183,544.23 4,748.83 90,521.40
Borrowings 12,640.44 1,595.83 7,160.38 12,010.01 2,393.54 2,556.13 4,962.22 4,715.86
Gap 8,144.16 –1,223.94 –24,392.36 –30,471.36 –23,565.61 291.42 39,574.80 26,455.36
Cumulative Gap 8,144.16 6,920.22 –17,472.14 –47,943.50 –71,509.11 –71,217.69 –31,642.89 –5,187.53
in cr 81,441.60 69,202.20 –174,721.40 –479,435.00 –715,091.10 –712,176.90 –316,428.90 –51,875.30
Gap as % to Outflow 23.37 –12.81 –45.71 –65.86 –36.62 0.16 407.52 27.78
2015-March Loans and Advances 40,699.38 7,478.22 22,959.55 22,757.46 28,024.53 190,170.93 31,475.60 36,968.73

The IUP Journal of Bank Management, Vol. XVII, No. 1, 2018

 Appendix (Cont.)

Table A3 (Cont.)
Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
Investment 90.34 503.80 4,692.44 2,035.46 2,263.08 19,715.61 23,377.82 99,207.24
Deposits 22,628.16 9,553.63 39,335.90 45,119.66 54,568.51 197,428.91 5,647.99 127,095.88
Borrowings 19,523.47 –462.12 1,134.81 1,496.98 1,876.31 7,276.88 6,519.82 8,304.40
Gap –1,361.91 –1,109.49 –12,818.72 –21,823.72 –26,157.21 5,180.75 42,685.61 775.69
Cumulative Gap –1,361.91 –2,471.40 –15,290.12 –37,113.84 –63,271.05 –58,090.30 –15,404.69 –14,629.00
in cr –13,619.10 –24,714.00 –152,901.20 –371,138.40 –632,710.50 –580,903.00 –154,046.90 –146,290.00
Gap as % to Outflow –3.23 –12.20 –31.67 –46.82 –46.34 2.53 350.81 0.57
2016-March Loans and Advances 25,431.64 9,226.02 50,079.63 28,361.20 32,667.44 189,721.13 28,443.96 48,394.78
Investment 1,767.34 1,487.19 3,711.01 3,128.55 3,815.42 22,221.51 21,657.39 101,018.11
Deposits 26,898.35 13,111.28 38,989.28 39,636.15 51,101.10 217,458.26 6,835.16 159,021.55
Borrowings 19,971.63 1,757.29 6,656.77 3,713.24 6,732.89 2,229.83 761.67 17,932.64
Gap –19,671.00 –4,155.36 8,144.59 –11,859.64 –21,351.13 –7,745.45 42,504.52 –27,541.30
Cumulative Gap –19,671.00 –23,826.36 –15,681.77 –27,541.41 –48,892.54 –56,637.99 –14,133.47 –41,674.77

Asset-Liability Management as a Risk Management Tool in Commercial Banks in India

in cr –196,710 –238,263.60 –156,817.70 –275,414.10 –488,925.40 –566,379.90 –141,334.70 –416,747.70
Gap as % to Outflow –41.97 –27.95 17.84 –27.36 –36.92 –3.53 559.50 –15.56
2017- March Loans and Advances 25,864.17 15,988.52 18,180.71 8,651.10 32,215.26 210,659.85 38,439.68 69,493.86
Investment 99.99 746.60 4,900.80 4,108.48 4,322.76 26,255.47 21,742.06 125,951.89
Deposits 29,435.96 12,164.72 43,633.14 44,697.90 53,686.66 254,178.25 7,531.90 176,375.49
Borrowings 336.79 1,751.70 8,948.81 6,206.96 1,664.03 1,843.60 330.18 19,681.26

43
44
Appendix (Cont.)

Table A3 (Cont.)
Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
Gap –3,808.59 2,818.70 –29,500.44 –38,145.28 –18,812.67 –19,106.53 52,319.66 –611.00
Cumulative Gap –3,808.59 –989.89 –30,490.33 –68,635.61 –87,448.28 –106,554.81 –54,235.15 –54,846.15
in cr –38,085.90 –9,898.90 –304,903.30 –686,356.10 –874,482.80 –1,065,548.1 –542,351.50 –548,461.50
Gap as % to Outflow –12.79 20.25 –56.10 –74.93 –33.99 –7.46 665.47 –0.31
Source: Annual Reports

Table A4: State Bank of India

Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
2008-March Loans and Advances 78,308.83 12,467.6 12,966.63 11,380.72 15,298.44 168,907.8 43,212.08 74,226.11
Investment 83.68 1,325.32 3,729.36 5,208.98 6,274.24 38,455.91 33,888.13 100,535.65
Deposits 66,386.15 6,317.86 22,983.65 25,871.69 36,525.64 118,495.71 93,357.76 167,465.48
Borrowings 11,629.39 5,726.92 15,887.11 4,142.76 7,130.49 5,860.76 771.99 577.99
Gap 377 1,748 –22,175 –13,425 –22,083 83,007 –17,030 6718
Cumulative Gap 377 2,125 –20,050 –33,474 –55,558 27,449 10,420 17,138
in cr 3,770 21,251 –200,497 –334,744 –555,579 274,494 104,198 171,381
Gap as % to Outflow 0 15 –57 –45 –51 67 –18 4
2009-March Loans and Advances 87,221.68 8,026.04 33,299.25 26,620.89 19,452.19 240,706.9 42,276.2 84,900.05
Investment 18,024.74 4,494.75 21,733.42 7,848.99 6,777.18 32,238.61 60,331.76 124,504.5

The IUP Journal of Bank Management, Vol. XVII, No. 1, 2018

 Appendix (Cont.)

Table A4 (Cont.)
Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
Deposits 83,690.4 14,592.93 37,853.31 56,627.41 866,114.2 181,909.6 102,864.8 178,420.51
Borrowings 12,362.18 5,531.82 10,490.96 8,523.6 4,384.83 9,173.88 3,052.88 193.53
Gap 9,194 –7,604 6,688 –30,681 –844,270 81,862 –3,310 30,791
Cumulative Gap 9,194 1,590 8,278 –22,403 –866,673 –784,810 –788,120 –757,330
in cr 91,938 15,899 82,783 –224,029 –8,666,725 –7,848,105 –7,881,202 –7,573,297
Gap as % to Outflow 10 –38 14 –47 –97 43 –3 17
2010-March Loans and Advances 96,259.37 8,888.53 33,914.61 35,494.45 27,616.38 275,367.7 59,944.08 94,429.07
Investment 600.36 1,802.52 10,415.07 7,991.92 6,095.1 51,770.22 59,533.46 147,581.42
Deposits 69,713.93 20,483.98 43,403.06 64,260.77 90,342.06 262,985.2 135,539.1 117,388.13
Borrowings 18,435.51 4,802.38 19,350.31 10,058.28 5,485.78 6,793.2 5,535.16 32,550.98
Gap 8,710 –14,595 –18,424 –30,833 –62,116 57,360 –21,597 92,071
Cumulative Gap 8,710 –5,885 –24,309 –55,141 –117,258 –59,898 –81,495 10,576
in cr 87,103 –58,850 –243,087 –551,414 –1,172,578 –598,983 –814,950 105,764

Asset-Liability Management as a Risk Management Tool in Commercial Banks in India

Gap as % to Outflow 10 –58 –29 –41 –65 21 –15 61
2011-March Loans and Advances 96,259.37 8,888.53 33,914.61 35,494.45 27,616.38 275,367.7 59,944.08 94,429.07
Investment 1,928.57 2,289.27 4,201.94 11,196.27 6,540.61 56,742.58 52,689.05 1,600,012.3
Deposits 67,538.9 15,202.16 45,801.6 88,669.77 120,303.1 277,716.7 161,535 157,165.55
Borrowings 16,200.6 4,903.26 17,474.77 8,776.92 10,349.74 5,690.22 15,204.41 40,969.26
Gap 14,448 –8,928 –25,160 –50,756 –96,496 48,703 –64,106 1,496,307

45
46
Appendix (Cont.)

Table A4 (Cont.)
Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
Cumulative Gap 14,448 5,521 –19,639 –70,395 –166,891 –118,188 –182,294 1,314,013
in cr 144,484 55,208 –196,390 –703,950 –1,668,909 –1,181,875 –1,822,938 13,140,127
Gap as % to Outflow 17.3 –44 –40 –52 –74 17 –36 755
2012-March Loans and Advances 63,334.94 10,140.95 47,080.98 38,041.23 43,231.6 408,461.9 81,234.24 176,053.01
Investment 2,662.74 3,514.89 19,109.04 8,664.67 11,902.56 48,553.21 54,935 162,855.5
Deposits 72,264.69 17,309.22 54,829.96 100,330.6 137,776.4 306,073.6 178,971.2 176,091.82
Borrowings 17,519.66 6,748.88 21,202.93 9,765.7 5,107.03 12,524.56 18,052.01 36,084.79
Gap –23,787 –10,402 –9,843 –63,390 –87,749 138,417 –60,854 126,732
Cumulative Gap –23,787 –34,189 –44,032 –107,422 –195,171 –56,754 –117,608 9,124
in cr –237,867 –341,889 –440,318 –1,074,222 –1,951,715 –567,544 –1,176,083 91,236
Gap as % to Outflow –26 –43 –13 –58 –61 43 –31 60
2013-March Loans and Advances 116,546 8,620.34 47,231.34 43,115.51 41,753.47 502,134.6 115,593.5 170,621.81
Investment 6,791.15 4,313.41 23,300.54 15,973.75 11,899.25 47,102.48 65,736.09 175,810.6
Deposits 89,428.48 24,714.75 49,399.81 88,325.85 180,116.8 336,798.3 224,094 209,861.65
Borrowings 22,426.75 10,590.92 37,664.35 18,006.82 7,552.7 27,666.7 8,861.34 36,413.13
Gap 11,482 –22,372 –16,532 –47,243 –134,017 184,772 –51,626 100,158
Cumulative Gap 11,482 –10,890 –27,422 –74,666 –208,682 –23,910 –75,536 24,622
in cr 114,819 –108,901 –274,223 –746,657 –2,086,825 –239,103 –755,361 246,215
Gap as % to Outflow 10 –63 –19 –44 –71 51 –22 41

The IUP Journal of Bank Management, Vol. XVII, No. 1, 2018

 Appendix (Cont.)

Table 4 (Cont.)
Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
2014-March Loans and Advances 150,184.1 7,071.3 41231.15 42,066.55 68,304.91 560,674.7 130,009.5 210,286.57
Investment 391 7,353 15,282 5,819 17,899 52,851 81,913 216,802
Deposits 136,841.1 26,421.54 88,873.24 104,788.4 188,422.3 292,956.2 148,532.2 407,573.64
Borrowings 19,104.47 5,803.97 33,984.67 21,323.88 27,551.44 23,574.78 19,617.62 32,170.05
Gap –5,371 –17,801 –66,345 –78,227 –129,770 296,994 43,772 –12,656
Cumulative Gap –5,371 –23,172 –89,517 –167,744 –297,513 –519 43,253 30,598
in cr –53,706 –231,719 –895,169 –1,677,435 –2,975,133 –5,191 432,531 305,975
Gap as % to Outflow –3 –55 –54 –62 –60 94 26 –3
2015-March Loans and Advances 111,099.3 16,981.77 68,614.55 73,835.91 85,919.15 642,058.6 127,338.3 173,818.79
Investment 4,509 6,647 17,213 15,488 22,613 69,509 82,072 276,975
Deposits 102,385 26,278 93,337 139,455 228,348 374,750 168,526 443,714
Borrowings 29,346 14,275 43,860 24,441 19,667 20,959 16,620 35,983
Gap –16,122 –16,924 –51,369 –74,572 –139,482 315,860 24,264 –28,903
Cumulative Gap –16,122 –33,047 –84,415 –158,988 –298,470 17,390 41,654 12,751

Asset-Liability Management as a Risk Management Tool in Commercial Banks in India

in cr –161,223 –330,467 –844,154 –1,589,876 –2,984,698 173,898 416,536 127,507
Gap as % to Outflow –12 –42 –37 –45 –56 80 13 –6
2016-March Loans and Advances 100,373.8 17,512.55 89,543.5 51,218.22 66,019.16 665,803.2 175,530.7 297,699.28
Investment 1,664 1,590 12,513 10,767 19,519 89,294 57,136 284,614
Deposits 82,443 26,786 91,505 142,701 729,434 406,205 159,306 492,342

47
48
Appendix (Cont.)

Table A4 (Cont.)
Maturity Buckets
1-14 d 15-28 d 29 d-3 m 3-6 m 6 m-1 y 1-3 y 3-5 y Above 5 y
Borrowings 15,129 1,6751 55,712 25,353 17,601 31,350 16,575 45,719
Gap 4,466 –24,435 –45,161 –106,068 –661,497 317,542 56,786 44,252
Cumulative Gap 4,466 –19,969 –65,130 –171,198 –832,695 –515,153 –458,367 –414,116
in cr 44,658 –199,691 –651,298 –1,711,983 –8,326,950 –5,151,531 –4,583,675 –4,141,159
Gap as % to Outflow 5 –56 –31 –63 –89 73 32 8
2017-March Loans and Advances 110,857.9 24,246.23 60,433.19 25,110.19 34,647.16 573,669 130,137.8 611,976.92
Investment 6,001.95 9,420.6 43,334.05 65,709.5 47,135.41 100,108.6 109,188.9 385,090.65
Deposits 88,743.84 42,544.33 122,166.9 177,889.8 350,586.3 457,630.5 204,524.4 600,665.33
Borrowings 102,029.6 18,284.39 47,137.61 37,371.23 13,169.8 20,431.03 23,590.79 55,679.18
Gap –73,913.6 –27,161.9 –65,537.2 –124,441 –281,974 195,716 11,211.56 340,723.06
Cumulative Gap –73,913.6 –101,076 –166,613 –291,054 –573,028 –377,312 –366,100 –25,377.04
in cr –739,136 –1,010,755 –1,666,127 –2,910,541 –5,730,276 –3,773,117 –3,661,001 –253,770.4
Gap as % to Outflow –38.7442 –44.6531 –38.7097 –57.8095 –77.5172 40.93949 4.914868 51.912228
Source: Annual Reports

The IUP Journal of Bank Management, Vol. XVII, No. 1, 2018

 Appendix (Cont.)

Table A5: NPA of Banks

Year HDFC Bank ICICI Bank PNB SBI
2007-08 9,040 75,800 33,190 128,370
2008-09 19,839 96,493 27,675 163,456
2009-10 18,072 92,674 32,144 178,363

2010-11 16,603 98,160 43,794 230,735

2011-12 18,149 92,926 86,899 371,560
2012-13 20,481 96,078 134,658 511,894
2013-14 27,754 105,058 188,801 616,054
2014-15 32,658 150,947 256,949 567,253
2015-16 42,976 262,212 558,183 981,728

Reference # 10J-2018-02-02-01

Asset-Liability Management as a Risk Management Tool in Commercial Banks in India 49

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