{
  "title": "Sovereign Risk and Asset and Liability Management: Conceptual Issues",
  "publication": "IMF Working Papers, October 4, 2012",
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  "summary": "Country practices towards managing financial risks on a sovereign balance sheet continue to evolve. Each crisis period, and its legacy on sovereign balance sheets, reaffirms the need for strengthening financial risk management.",
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    {
      "heading": "Overview",
      "content": "- Country practices towards managing financial risks on a sovereign balance sheet continue to evolve.\n- Crisis periods and their legacy on sovereign balance sheets reaffirm the need for strengthening financial risk management.\n- The paper discusses salient features embedded in the current generation of sovereign asset and liability management (SALM) approaches, including:\n  - objectives;\n  - definitions of relevant assets and liabilities;\n  - methodologies used in obtaining optimal SALM outcomes.\n- The paper seeks to lay the ground for further policy and analytical work on SALM."
    },
    {
      "heading": "SALM framework and portfolio perspective",
      "content": "- Elements from SALM approaches are used to develop an analytical SALM framework intended to become an operational instrument for:\n  - formulating asset management strategies at the sovereign level;\n  - formulating debtor liability management strategies at the sovereign level.\n- From a portfolio perspective, the SALM approach can:\n  - help detect direct and derived sovereign risk exposures;\n  - analyze the financial characteristics of the balance sheet;\n  - identify sources of costs and risks;\n  - quantify the correlations among these sources of risk."
    },
    {
      "heading": "Institutional requirements and implementation",
      "content": "- The paper outlines institutional requirements for implementing an SALM framework (institutional detail is described in the paper)."
    },
    {
      "heading": "Key findings and emphases",
      "content": "- Strengthening financial risk management on sovereign balance sheets is an ongoing need reinforced by each crisis period.\n- A unified SALM framework can integrate asset and liability management to better detect and quantify sovereign risk and its correlations across the balance sheet.\n\n---\n\n Content in this bundle\n\n- wp12241\n  - wp12241 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - wp12241 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/sovereign-risk-and-asset-and-liability-management-conceptual-issues-40037"
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    "Authors: Udaibir S Das, Miss Yinqiu Lu, Michael G. Papaioannou, Iva Petrova",
    "Published: October 4, 2012",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781475511833.001",
    "Country practices towards managing financial risks on a sovereign balance sheet continue to evolve.",
    "Crisis periods and their legacy on sovereign balance sheets reaffirm the need for strengthening financial risk management.",
    "The paper discusses salient features embedded in the current generation of sovereign asset and liability management (SALM) approaches, including:",
    "The paper seeks to lay the ground for further policy and analytical work on SALM.",
    "Elements from SALM approaches are used to develop an analytical SALM framework intended to become an operational instrument for:",
    "From a portfolio perspective, the SALM approach can:",
    "The paper outlines institutional requirements for implementing an SALM framework (institutional detail is described in the paper).",
    "Strengthening financial risk management on sovereign balance sheets is an ongoing need reinforced by each crisis period.",
    "A unified SALM framework can integrate asset and liability management to better detect and quantify sovereign risk and its correlations across the balance sheet.",
    "**_wp12241**"
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