No abstract

Bank liquidity management has become a major issue during the financial crisis as liquidity shortages have intensified and have put pressure on banks to diversity and improve their liquidity sources.While a significant strand of the literature concentrates on wholesale liquidity generation and on the alternative to deposit funding, the management of an inventory of cash holdings within the banks’ branches is also a relevant issue as any significant improvement in cash management at the bank distribution channels may have a positive effect in reducing liquidity tensions. In this paper, we propose a simple programme of cash efficiency for the banks’ branches, very easy to implement, which conform to a set of instructions to be imposed from the bank to their branches. This model proves to significantly reduce cash holdings at branches thereby providing efficiency improvements in liquidity management.The methodology we propose is based on the definition of some stochastic processes combined with renewal processes, which capture the random elements of the cash flow, before applying suitable optimization programmes to all the costs involved in cash movements. The classical issue of the Transaction Demand for the Cash and some aspects of Inventory Theory are also present.Mathematics Subject Classification (2000)C02, C60, E50

No abstract

No abstract

The maintenance of cash levels under certain security thresholds is key for the health of the banking sector. In this paper, the monitoring process of branch network cash levels is performed using a single intelligent system which should provide an alert when there are cash shortages at any point of the network. Such an integral solution would provide a unified insight that guarantees that branches with similar cash features are secured as a whole. That is to say, a triggered alarm at a specific branch would indicate that attention must also be paid to similar (in‐cash‐feature) branches. The system also incorporates a (complementary) specific treatment for individual branches. The Early Warning System for securing cash levels presented in this paper (cash level EWS) is deliberately free of local demographic specifications, thereby overcoming the current lack of worldwide definitions for local demographics. This aspect would be particularly valuable for banking institutions with branch networks all over the world. A further benefit is the cost reductions that are a result of replacing several approaches with a single global one. Instead of local demographic parameters, a solid theoretical model based on Markov random fields (MRFs) has been developed. The use of MRFs means a reduction in the amount of information required. This would mean a higher processing speed as well as a significant reduction in the amount of storage capacity required. To the best of the author's knowledge, this is the first time that MRFs have been applied to cash monitoring.

No abstract

No abstract

No abstract