Abstract:

The performance of commercial banks is, inter alia, a reflection of the effectiveness with which it performs its Asset/Liability Management (ALM) function. This study focused on examining the efficacy with which the commercial banks in Pakistan are performing the ALM function. In this regard awareness of relevant bank personnel with ALM function and the current organizational arrangement for the same was also looked into. The broad conclusion of the study is that ALM function in Pakistani banks is not being performed very effectively and in particular liabilities management needs lots of improvements. Based on analysis of questionnaires and discussions with bank executives, the study comes up with a number of suggestions for improvement in the ALM function of banks in Pakistan.