SAS and Microsoft partnership focuses on banking risk

Tuesday, 26 September, 2023

SAS and Microsoft partnership focuses on banking risk

SAS is expanding its partnership with Microsoft to help banks better manage looming liquidity and interest rate risks. The organisation's Asset and Liability Management (ALM) platform, powered by Kamakura Risk Manager on Microsoft Azure, supports multi-period, scenario-based, integrated simulation and valuation for risk management, capital allocation and balance sheet optimisation.

"A recent ALM study by SAS and Celent revealed that eight in 10 financial services firms are considering significant improvements to their ALM programs," said Troy Haines, Senior Vice President and Head of Risk Research and Quantitative Solutions at SAS.

"Whether they're adding next-gen technology to enhance existing systems or contemplating new platforms, SAS is recognised for delivering best-in-class risk and finance solutions. Partnering with Microsoft to accelerate risk innovation in the cloud, we broaden our mutual reach and impacts, helping banks, insurers and other financial industry players mitigate and minimise risk in this persistently uncertain climate."

Reshaping the future of ALM technology

The partnership expansion comes roughly a year after SAS acquired specialised financial risk management firm Kamakura Corporation and on the heels of SAS's recently announced three-year, $1 billion investment in industry-tailored AI solutions.

These strategic investments are advancing the organisation's ALM solutions, which use scalable, cloud-native technology to support robust stress testing and simulation capabilities. Sophisticated, position-level calculations for interest rate, market and liquidity risks can be dynamically aggregated and analysed to support real-time decision-making. Moreover, advanced analytics like machine learning and new generative AI capabilities can help risk managers assess and react to risks in real time through natural language queries.

These advances are already empowering many of SAS's banking customers.

The path to modernised balance sheet management

Banks across the globe are contending with rising interest rates and stricter policies to address inflation. As a result, liquidity is both scarcer and more expensive. Forward-looking financial institutions must optimise their data, analytics and decision-making to improve their risk-adjusted profitability and adequately fund their liquidity risk strategies.

"SAS ALM on Microsoft Azure combines the power of machine learning and new generative AI capabilities, supercharging the speed and accuracy of these metrics to help firms identify and capitalise on liquidity opportunities, potentially adding tens of millions of dollars to a bank's bottom line annually at little cost," said Bill Borden, Corporate Vice President of Financial Services at Microsoft.

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