Certificate in Liquidity Risk Management

Why Attend

Liquidity risk is one of the most critical financial risks facing banks, financial institutions, and corporate treasury functions. An organisation may report strong profitability and hold substantial assets yet still experience financial distress if it cannot meet its payment obligations when they fall due. Funding concentration, unexpected cash outflows, market disruption, collateral requirements, and limited access to financing can quickly expose weaknesses in liquidity management.

The Certificate in Liquidity Risk Management course develops practical knowledge of liquidity risk identification, measurement, monitoring, stress testing, funding strategies, and contingency planning. Participants examine the relationship between liquidity, capital, profitability, and financial stability, alongside regulatory expectations and established liquidity risk management practices.

The programme covers cash flow forecasting, liquidity gaps, funding diversification, liquidity buffers, the Liquidity Coverage Ratio (LCR), Net Stable Funding Ratio (NSFR), asset-liability management, early warning indicators, and liquidity stress scenarios. Through financial modelling exercises and case studies, participants learn how to assess liquidity vulnerabilities, evaluate funding resilience, and strengthen liquidity governance.

Professional Problems This Course Is Designed to Solve

• Unexpected liquidity shortages: Improving cash flow forecasting and liquidity gap analysis to identify potential funding shortfalls before they become critical.

• Excessive reliance on concentrated funding sources: Evaluating funding concentration, maturity mismatches, and refinancing exposure to improve funding resilience.

• Inadequate liquidity risk measurement: Developing appropriate liquidity metrics, monitoring thresholds, and management information to support timely decisions.

• Weak liquidity stress testing: Designing realistic stress scenarios that assess cash outflows, funding disruptions, collateral requirements, and available liquidity buffers.

• Insufficient contingency funding arrangements: Establishing practical contingency funding plans with defined triggers, responsibilities, escalation procedures, and funding options.

• Difficulty interpreting regulatory liquidity requirements: Understanding the principles and calculations underlying LCR, NSFR, and relevant supervisory liquidity expectations.

• Poor coordination between treasury, risk, and finance: Strengthening liquidity governance, reporting, risk appetite, and asset-liability management decisions.

Course Methodology

The programme combines instructor-led financial and risk management sessions, liquidity ratio calculations, Excel-based cash flow modelling, funding analysis exercises, regulatory case studies, and liquidity stress-testing workshops.

Participants examine realistic banking and treasury scenarios involving funding mismatches, liquidity buffers, deposit withdrawals, market disruptions, and contingency funding decisions. Practical activities progressively develop the components of a liquidity risk management framework, culminating in a comprehensive liquidity assessment and management action plan.

Course Objectives

By the end of this course, participants will be able to:

• Explain the sources, characteristics, and consequences of liquidity risk

• Distinguish funding liquidity risk from market liquidity risk

• Evaluate liquidity risk exposures across assets, liabilities, and funding structures

• Prepare contractual and behavioural cash flow forecasts

• Measure liquidity gaps and identify maturity mismatches

• Understand the calculation and interpretation of LCR and NSFR

• Evaluate the adequacy and composition of liquidity buffers

• Develop liquidity risk appetite indicators and monitoring thresholds

• Design liquidity stress-testing scenarios and interpret their results

• Assess funding diversification and concentration risks

• Develop contingency funding plans and escalation procedures

• Strengthen liquidity governance, reporting, and management decision-making

Target Audience

This course is suitable for:

• Treasury managers and treasury professionals

• Liquidity risk managers and analysts

• Financial risk management professionals

• Asset-Liability Management (ALM) specialists

• Bank finance managers and financial controllers

• Corporate treasury and cash management professionals

• Banking regulatory compliance professionals

• Internal auditors responsible for treasury and liquidity risk

• Financial institution risk committee members

• Finance and risk professionals seeking specialised liquidity risk knowledge

Target Competencies

Participants will develop competencies in:

• Liquidity risk identification and assessment

• Cash flow forecasting and liquidity gap analysis

• Funding liquidity risk management

• Market liquidity risk assessment

• Liquidity Coverage Ratio analysis

• Net Stable Funding Ratio analysis

• Liquidity stress testing

• Funding diversification and liquidity buffers

• Contingency funding planning

• Liquidity governance and regulatory reporting