Funds Transfer Pricing

Course objectives

• Understand the fundamentals of Funds Transfer Pricing and why banks use it
• Analyse how FTP curves incorporate tenor matching and liquidity components
• Evaluate the allocation of funding costs across different business divisions
• Apply behavioural adjustment concepts to deposit and prepayment scenarios
• Interpret FTP governance structures and their effect on business incentives
• Implement FTP concepts within practical banking and treasury contexts

Who should attend

• Treasury and asset and liability management professionals
• Product control and finance practitioners in banking
• Risk professionals working on liquidity and interest rate risk
• Relationship and product managers in lending and deposits
• Analysts seeking a practical understanding of bank funding

Course outline

1. 01Introduction to Funds Transfer Pricing and the treasury framework
2. 02Constructing the FTP curve: yield curves, tenor structure and liquidity premiums
3. 03Behavioural adjustments: deposit modelling, prepayment risk and embedded options
4. 04Applying FTP across lending, deposits and the trading book
5. 05Governance and incentives: oversight, business behaviour and common pitfalls
6. 06Practical workshop: worked calculations and strategy alignment

Scheduled sessions