Liquidity Day 8 💧 FTP explained simply. #Banking #Liquidity #finance
27 April 2026·1 min
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Welcome to Day 8 of the Industry Portal liquidity management course, where we break down Funds Transfer Pricing (FTP) — the engine that embeds liquidity into every decision a bank makes.
In this session, we explain how FTP works as an internal pricing mechanism, ensuring that the true cost and value of liquidity is reflected across lending, deposits, and trading activities.
You will learn how banks charge business lines for the funding they consume and reward them for providing stable funding, creating an internal market that aligns commercial decisions with liquidity strategy.
We explore how FTP supports accurate product pricing, realistic profitability analysis, and stronger risk adjusted decision making. You will also understand how FTP helps manage maturity mismatches and supports compliance with key regulatory metrics such as LCR and NSFR.
The session covers different FTP approaches, including pooled FTP, dual FTP where interest rate risk and liquidity risk are separated, and behavioural FTP based on expected cash flows rather than contractual maturities.
You will gain insight into how FTP influences business behaviour, shaping how products are designed, priced, and managed across the organisation.
We also address practical challenges such as transparency, governance, data quality, and the role of FTP committees in maintaining a consistent and credible framework.
By the end of this session, you will understand how FTP transforms liquidity from a central Treasury function into an enterprise wide discipline that drives accountability, performance, and resilience.
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Subscribe for the full liquidity management course.
#FTP #LiquidityManagement #Banking #Finance #Treasury #RiskManagement #LCR #NSFR #TheIndustryPortal
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