Provide high efficiency of investment policy

The concept of efficiency of investment policy involves not only the possibility of achieving a high level of bank profits from its investments in securities and investment activities in general, but also ensuring an adequate level of financial security and reliability of this activity over the estimated period. To ensure high efficiency in the development of investment policy must be defined relative criteria for the level of profitability, liquidity and risk of the portfolio securities. 9. Flexibility of investment policy. Internal and external conditions for investment banks, predicted the development of their investment policy, may have some deviations from their expected values. These deviations may in the future to ensure an appropriate adjustment mechanisms to achieve strategic objectives. Therefore, when developing an investment policy of the bank should determine the possible range of models appropriate management solutions that take into account possible changes in external and internal conditions of investment. According to these principles are the following steps in developing an investment policy of the bank: 1. Analysis of the investment bank's activities for the previous period. In this analysis, we study the volume, shape and efficiency of financial investment in the bank. The objects of analysis are: the total investment in securities, the rate of change of the portfolio of securities, changes in the share of portfolio securities in bank assets, the composition, structure, portfolio of securities for specific financial instruments and their dynamics; profitability of individual securities and portfolio as a whole. The analysis allows to estimate the extent and efficiency of the securities portfolio in the pre-planning period. 2. Assessment of internal capacity and capabilities of the bank's development. The most important factors determining the investment policy of the bank include: type of strategy, commercial bank, regional and sectoral specificity of the bank, the bank's resource potential, the ability to achieve the objectives of the bank through a portfolio of securities, the need to maintain an appropriate level of liquidity and minimize risks; professional training, qualifications and experience of bank staff, bank staff ownership practical theory and tools to reduce investment risk. Category: Management Operations Commercial Bank | Tags: securities