12/06/2023 | Regular Council Meeting of Georgian Financial Markets Treasuries Association was held on June 6, 2023

Regular Council Meeting of Georgian Financial Markets Treasuries Association (GFMTA) was held on June 6, 2023. The meeting was attended by representatives of NBG, GFMTA member Commercial Banks, Pension Agency and European Bank for Reconstruction and Development (EBRD).

 

Members discussed the development of the Interest Rate Risk management tools market. One such instrument is the Overnight Index Swap (OIS), involving the overnigh rate being exchanged for a fixed interest rate.

 

As a rule, Interest Rate Risks typically arise when there is a mismatch between assets and liabilities, either in the form of fixed or floating interest rates, and/or by having Interest Rates of different maturities.

One of the practical examples of materialization of Interest Rate Risk is the well-known case of Insolvency of SVB Silicon Valley Bank in March, 2023.