Funds Transfer Pricing
Funds transfer pricing frameworks for banks. Accurate funding cost allocation across business units for true profitability measurement, pricing decisions, and balance sheet optimisation.
Accurate Funds Transfer Pricing for Banks
Funds transfer pricing (FTP) is the mechanism by which banks allocate funding costs and benefits to individual business units, products, and transactions. A well-designed FTP framework is essential for measuring true profitability, making informed pricing decisions, and ensuring business units bear the correct cost of the funding and liquidity they consume.
redskios designs and implements FTP frameworks that use matched-maturity and multi-curve approaches, handle optionality adjustments for prepayable and callable instruments, include liquidity premiums reflecting the true cost of maintaining regulatory buffers, and integrate with your core banking and ALM systems for automated, transaction-level FTP assignment.