This module introduces the structure of financial markets within the Indian financial system, covering money market instruments, capital market instruments, and foreign exchange operations. Learners explore key financial instruments, their characteristics, risk profiles, regulatory relevance, and the role of treasury functions in managing short-term liquidity and long-term funding strategies.

This module examines Asset Liability Management (ALM) as a strategic balance sheet management framework used by banks to optimize profitability while controlling liquidity, interest rate, and market risks. It explains macro and micro ALM decision-making, price and maturity matching techniques, liquidity gap analysis, and the governance role of ALCO in implementing risk management policies.

This module explores the structure and interpretation of bank financial statements, including the balance sheet, profit and loss account, and cash flow statement. It further develops analytical skills through ratio analysis and introduces the CAMELS framework as a comprehensive method for evaluating bank performance, capital adequacy, asset quality, management effectiveness, earnings stability, liquidity, and sensitivity to market risk.