Liquidity Asset Liability Management: Breakthrough Technologies to Improve Metrics for Forecasting

The relentless profitability pressures imposed on today’s finance sector have been triggering various banking organizations and specialty finance companies to integrate next-generation technologies with their liquidity asset liability management operations. In addition, as poor liquidity risk management systems can cost a company a fortune, it is further strengthening the need for applying technological advancements in liquidity asset liability management solutions to incur a significant rise in profitability.

With a mounting number of financial institutions undertaking a rigorous approach while dealing with risk management demands, the liquidity asset liability management solutions market in rapidly moving towards a smarter future. The growing adoption of cutting-edge technologies such as Artificial Intelligence (AI) and machine learning for predictive analytics is shaping the emerging trends in this landscape, underscoring the importance of technological integration into liquidity asset liability management solutions.

liquidity asset liability management infographic

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Transparency Market Research’s recent study examines the factors that are catalyzing technological transformations in the liquidity asset liability management solutions market, to project how the future will look for this landscape. This study offers value-based and actionable insights about the growth prospects of the market, for stakeholders to make more informed liquidity asset liability management-related decisions.

Financial institutions are showing inclination towards employing AI to understand their clients, ensure compliance, improve analytics, and produce better forecasts based on existing data. Eventually, leading players in the liquidity asset liability management solutions landscape are streamlining their business strategies to stay resilient and withstand potential technological disruptions in the industry, even as new competitors crowd the scene. Being a popular technology with guaranteed returns on investment, the application of AI in the liquidity asset liability management solutions landscape is expected to emerge as a winning strategy for stakeholders in the coming years.

Analytics in the liquidity asset liability management solutions market entails huge volumes of data that is complex, and Big Data technology has reshaped the finance sector with improved metrics for cognitive processing and forecasting. Stakeholders in the industry are likely to focus on employing Big Data for accurate results at each step. The integration of Big Data technology into liquidity asset liability management solutions will lead them to achieving faster results, which, in turn, will allow for newer risks to be uncovered.

Market to Grow Amid Increased Financial Inclusivity and Stringent Regulatory Compliances

Increasing growth of the liquidity asset liability management solutions landscape is mainly triggered by the growing volume of transactions and burgeoning need for risk management solutions. With the rise in the number of financial transactions taking place, both, online and offline, there is the heightened need to manage risk and maintain an acceptable profitability level of various financial transactions for various banking organizations.

Leading banking institutions are adopting technologically-advanced liquidity asset liability management solutions to ensure the efficient and coordinated management of sensitive banking operations with a rapidly multiplying number of individuals with at least one bank account or an account with a mobile money provider.

The global market for liquidity asset liability management solutions landed a valuation of ~ US$ 1 billion in 2018, and is expected to witness 4.5% year-over-year growth in 2019. While the market is likely to witness healthy growth in the coming years, the implementation of strict regulations and stringent norms adds to the shareholder pressures of increased margin and reduced returns. Tightening regulations in the finance sector are making the structure of the businesses of financial institutions more complex, creating numerous challenges in developing apt liquidity asset liability management solutions that can suit their specific requirements.

liquidity asset liability management segmentation

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Emerging Opportunities in Europe’s Finance Sector; North America to Lead the Pack

With the advantage of being a strong economy and by virtue of being the first adopters of technology, North America is currently a prominent region in the liquidity asset liability management solutions market. This is set to remain so, with the United States keeping its position, while the positive growth prospects of the European finance industry are expected to create new opportunities for stakeholders in its liquidity asset liability management solutions market. Despite an upsurge in financial activities in Asia Pacific, especially in India and China, which are supporting the liquidity asset liability management solutions market in this region, developed regions are creating more lucrative avenues of growth for market players.

Considering the changing consumer experiences due to the proliferation of technology, and the security concerns that go hand in hand, business strategies that focus on high-tech security protocols in tech-driven asset liability management solutions can fetch profits in developed markets. The adoption of hardware-based solutions for liquidity asset liability management is plummeting rapidly, as end users turn toward software-based solutions to sync with the growing digitalization in the finance sector. Seeking high value growth opportunities, mainly in developed regions, stakeholders are employing strategies to strengthen the presence of their companies by not only expanding their product portfolios but also increasing their customer data base and strengthening their long-term business strategies.

There is a growing trend among key players of strategically acquiring smaller firms that offer technological solutions, giving them a competitive edge to consolidate their global presence. Leading players in the market are partnering with software companies as well as financial organizations to co-innovate high quality solutions and services to expand their presence in developing countries. For instance, Fidelity National Information Services, Inc. (FIS) recently announced that it formed a joint venture with Banco Bradesco, a leading Brazil-based bank, in order to provide financial services and solutions.

Within the liquidity asset liability management solutions market, customer retention continues to remain a priority. Wolters Kluwer – a leading stakeholder in the liquidity asset liability management solutions market – recently declared that ~78% of its revenue is recurring, as it gives customer satisfaction and retention immense importance throughout its race in this landscape. Leading companies in the market are likely to continue focusing on improving customer experience, which is expected to have a significant impact on the revenue and the stock value of their companies.

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Analysts’ Overview

Authors of the TMR report on the liquidity asset liability management solutions market are of the opinion that, the techniques of asset liability have evolved with technology, and the need for strategies to reduce the risks in asset-liability management in a digitalized finance sector has surged.

Looking ahead, market players should expect increased regulations, and a direct impact of the constraints of these regulations. Stakeholders who increase focus, not only on the adoption of technologies for effective liquidity asset management, but also to keep in sync with the advancements in existing technologies, will survive the cut-throat competition in this landscape. Though the liquid asset liability management market is set to grow at a fast pace, high installation and integration costs are still holding back avenues of growth. Market players will have to concentrate on promoting added value and return on investment for end users to pave their way through these challenges in the liquidity asset liability management solutions market.

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Global Liquidity Asset Liability Management Solutions Market: Overview

  • According to a new market report pertaining to the global liquidity asset liability management solutions market published by Transparency Market Research , the global liquidity asset liability management solutions market is projected to reach a value of ~ US$ 1.5 Bn by 2027.
  • The liquidity asset liability management solutions market is projected to expand at a CAGR of ~ 4% from 2019 to 2027.
  • Growth of the liquidity asset liability management solutions market can be attributed to rapid increase in financial inclusion, globally.
  • Over the forecast period, Asia Pacific is anticipated to grow rapidly in the liquidity asset liability management solutions market, at a 4.3% CAGR.
  • In terms of share, the liquidity asset liability management solutions market is dominated by North America, followed by Europe.
  • In the liquidity asset liability management solutions market, the solution segment was valued at ~US$ 465 Mn in 2017, and is expected to reach ~ US$ 705 Mn by 2027, expanding at a CAGR of ~ 4% during the forecast period.

Rapid Increase in Financial Inclusion, Globally

  • Financial inclusion has increased exponentially across the world. This is likely due to the rise in the volume of transactions and the dependency of financial institutions to manage funds and transactions.
  • Additionally, the number of bank accounts and accounts related to mobile payment services has increased by nearly 51%, which is driving the demand for banking solutions.
  • The demand for liquidity asset liability management solutions is increasing to manage the risks related to interest, foreign transactions, and balance sheet modeling. Asset liability management enables the portfolio management of liquid assets and liabilities on a daily, weekly, or monthly basis, which helps an organization determine the rate of interest, amount of lending, and also helps in minimizing the related risks.
  • Governments of different countries are planning and implementing regulations to check asset liability reports on a weekly or monthly basis. Such regulations as well as the need for optimized solutions have led to the increasing demand for liquidity asset liability management solutions.

Liquidity Asset Liability Management Solutions Market: Taxonomy

  • The global liquidity asset liability management solutions market has been segmented in terms of component, institution, and region.
  • Based on component, the liquidity asset liability management solutions market has been classified into hardware, solution, and services.
  • Based on institution, the liquidity asset liability management solutions market has been classified into banks, broker dealers, specialty finance, and wealth advisors.

Liquidity Asset Liability Management Solutions Market: Regional Outlook

  • In terms of region, the global liquidity asset liability management solutions market has been segmented into North America, Europe, Asia Pacific, Middle East & Africa, and South America.
  • North America is expected to dominate the liquidity asset liability management solutions market during the forecast period.
  • Asia Pacific is expected to experience increasing growth of the asset liability management market, with China and India being the major markets in the region.
  • The liquidity asset liability management solutions markets in the Middle East & Africa, Europe, and South America are also expected to expand rapidly during the forecast period.

The report provides in-depth segment analysis of the global liquidity asset liability management solutions market, thereby providing valuable insights at macro as well as micro levels. Analysis of major countries that hold growth opportunities or account for significant shares has also been included as part of the geographic analysis for the liquidity asset liability management solutions market.

Liquidity Asset Liability Management Solutions Market: Competition Dynamics

The research study includes profiles of leading companies operating in the global liquidity asset liability management solutions market.

Key players profiled in the report include

  • Moody's Corporation
  • Wolters Kluwer
  • Experian Information Solutions, Inc
  • Fidelity National Information Services, Inc.
  • Finastra, Fiserv, Inc
  • Infosys Limited
  • International Business Machines Corporation
  • Oracle Corporation
  • Polaris Financial Technology Limited
  • SAP SE.

Transparency Market Research’s recent report on the liquidity asset liability management solutions market offers a detailed analysis for the forecast period of 2019 to 2027. It provides insights on the current parameters and technologies in the market, and the divers, restraints, threats, and opportunities that will influence the market during the forecast period. This study takes a systematic approach to studying and analyzing the historical data and growth developments in the future of the liquidity asset liability management solutions market. The study will help readers understand the competitive analysis of the liquidity asset liability management solutions market, and gauge the future trajectory of progression.

This report consists of quantitative and qualitative analysis of data, a blend of which is essential for stakeholders in the liquidity asset liability management solutions market to formulate strategies for the future. The report, in its scope, also comprises Porter’s Five Forces Analysis, PESTEL Analysis, and a Value Chain Analysis as well. This report includes an in-depth analysis of the various competitors in the liquidity asset liability management solutions market, their product portfolios, revenues, and key developments.

In this study, readers can gain comprehensive information about the key dynamics that are influencing the growth of the liquidity asset liability management solutions market, and can help players assess the growth of their competitors in the field.

Key Segments of the Liquidity Asset Liability Management Solutions Market

This study by Transparency Market Research on the liquidity asset liability management solutions market categorizes the information into three segments: component, institution, and region. Readers will find data and analysis on how the changing trends impact the evolution and dynamics of the liquidity asset liability management solutions market.

Component

Institution

Region

Solutions

Banks

North America

Services

Brokers

Europe

Hardware

Specialty Finance

Asia Pacific

 

Wealth Advisors

Middle East and Africa

 

 

South America


The report provides information about the liquidity asset liability management solutions market across five regions: North America, Europe, Asia Pacific, Middle East and Africa, and South America.

Key Questions Answered in the Report

  • What are the drivers and deterrents in the liquidity asset liability management solutions market?
  • What opportunities present themselves in the liquidity asset liability management solutions market?
  • What are the various global trends in the liquidity asset liability management solutions market?
  • What is the influence of the changing trends in technology on the liquidity asset liability management solutions market?
  • Are there any specific strategies that companies in the liquidity asset liability management solutions market are adopting to stay ahead?
  • What is the revenue share of different components in the liquidity asset liability management solutions market?
  • What are the factors that are expected to support the evolution of the liquidity asset liability management solutions market?

Liquidity Asset Liability Management Solutions Market - Research Methodology

The research methodology employed by TMR in the making of this report consists of primary and secondary research, with the former in greater proportion. With an extensive internal repository and access to an external proprietary database, this report helps address specific details and questions on the liquidity asset liability management solutions market with utmost accuracy of information.

Sources of the information for primary and secondary research in the liquidity asset liability management solutions market report include interviews with key opinion leaders, statistics from governmental organizations, annual reports of companies, research papers and journals, and paid data bases as well. Analysts also utilized a top-down method for calculating the numbers in each segment, and a bottom-up approach for verifying the accuracy of the same.

Analysts’ conclusions on how the liquidity asset liability management solutions market is expected to grow is based on these exclusive and precise insights from primary and secondary sources.

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