Delfi announced the launch of its Risk/Return Benchmark, which lets U.S. banks and credit unions compare themselves with a select group of peers and see whether they are earning enough margin for the interest rate risk they carry. The tool shows institutions where they are not performing to their potential, and where there is room to improve risk-adjusted returns.

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“Taking more risk should come with more reward, but that’s not the case for too many community institutions. We’re giving banks and credit unions a way to see where their risk is paying off and where it isn’t.” – Daniel Ahn, PHD, Co-Founder & CEO of Delfi

Risk-adjusted return compares the margin an institution earns with the interest rate risk it carries. When two institutions earn the same margin, the one carrying less rate risk has the better risk-adjusted return.

Built by Delfi’s PhD economists with Wall Street quantitative experience, the Risk/Return Benchmark advances the firm’s mission to bring Wall Street tools to Main Street institutions. Delfi designed it so that a community bank or credit union can see whether the rate risk on its balance sheet earns as much margin as its closest peers earn at the same level of risk.

“Taking more risk should come with more reward, but that’s not the case for too many community institutions,” said Daniel Ahn, PhD, Co-Founder and CEO of Delfi.

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