AI-Enabled ALM Strategy Builder gives treasury teams the infrastructure to build, stress-test, and present hedging strategies at the speed and rigor that programmatic risk management demands
Derivative Path, a leading derivatives and risk management platform for financial institutions, announced the launch of ALM Strategy Builder, a product that gives banks and credit unions the ability to build, stress-test, compare, and present interest rate hedging strategies in a single environment.
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The value of hedging is no longer in question for depositories. Institutions that entered the derivatives market over the last decade have matured rapidly, and many now run robust programs. But the tooling available to most banks and credit unions has not kept pace. Hedging remains a labor-intensive process: building scenarios in spreadsheets, reconstructing analytics for committee presentations, and manually stress-testing strategy alternatives one at a time. As the industry moves toward institutionalized hedging as a standing discipline, operational overhead becomes the bottleneck. ALM Strategy Builder was built to remove it by compressing work that has historically taken hours or days into seconds.
“The institutions we work with are not waiting to be told that hedging matters; they already know. What they need is infrastructure that matches the seriousness of what they’re doing. Treasury teams at banks and credit unions are running hedging programs with real complexity, and they deserve tooling that reflects that. ALM Strategy Builder is how Derivative Path will deliver it.” — Pradeep Bhatia, CEO and Co-Founder, Derivative Path
The platform provides Treasury and ALM teams with a unified workspace to model hedge portfolios across standard rate-shock scenarios, custom shocks, and user-defined rate paths, all recalculated in real time. Those metrics can be evaluated in isolation or in the context of balance-sheet level interest rate risk results. Side-by-side strategy comparison evaluates proposed hedges across all scenarios simultaneously, and pre-configured templates reduce friction during common strategy builds.
The platform also addresses one of the most persistent operational challenges in hedge program management by translating analytical work into clear, actionable terms for decision-makers. ALCO-ready outputs can be generated at the click of a button, formatted for board and committee presentations. The analytical work and the presentation layer are built in the same place, at the same time. Treasury teams spend less time rebuilding their analysis for the audience and more time on the analysis itself.
A built-in AI assistant acts as a force multiplier across the platform. It interprets portfolio results, suggests alternative structures, and builds complete strategies from a stated objective. It surfaces considerations across the portfolio that might otherwise require hours of manual review, such as offsetting exposures, concentrations, and maturity mismatches. Users can ask plain-language questions such as “what happens to my earnings if I add a $25M five-year swap?” and receive data-driven answers in seconds based on live platform data. For mature programs, it accelerates workflows that would otherwise consume hours of manual analysis. For institutions building hedging capability, it helps teams demonstrate independence and analytical rigor from the outset. For everyone, it removes the mechanical overhead that has historically made hedging a more labor-intensive process than it needs to be.
The product is another example of purpose-built capital markets tools made available to the financial services industry by Derivative Path. Our Banking Advisory team, working closely with our AI Lab, built the ALM Strategy Builder in direct response to feedback from bank and credit union clients grappling with the lack of tooling available to them.
“When a single treasury professional can model, stress-test, and present a hedging strategy with the same rigor and speed as an institution with a dedicated derivatives desk, the entire conversation changes with their board, with their regulators, and within their Treasury and finance teams. That’s what this product is designed to do.” — Isaac Wheeler, Managing Director of Balance Sheet Strategy, Derivative Path
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