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August 6, 2021 Strategies for Success By Derek Layton

Excess liquidity continues to linger for many of our members. It’s becoming increasingly important for financial institutions to position their balance sheet for a rising rate environment.

Ask yourselves a few questions:

  • Can your institution withstand sitting on extra liquidity only earning 5 to 15 basis points?
  • Would it be beneficial for your institution to extend the duration of your assets and earn 10 times or greater on what you are earning now?
  • When will rates rise? In 6-months? 1-year?
  • How sticky are your deposits that grew due to customers stockpiling cash and pandemic monetary and fiscal policy decisions?

Most of our members would benefit from the extra income earned by extending out on the curve. With rates at historic lows, it’s a great time to put aside liquidity blindness and address uncertainty before rates increase.

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Derek Layton
Derek Layton Derek Layton joined FHLBank Topeka as a lending operations analyst in 2018. He was promoted to lending officer in 2020. Derek previously served as the Lead Personal Banker at CoreFirst. He is a graduate of Washburn University.
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