RBI issues final guidelines on liquidity coverage ratio

RBI issues final guidelines      on liquidity coverage ratio

The Reserve Bank on Monday said the Basel III liquidity coverage ratio (LCR) will be introduced in a phased manner with a requirement of 60 per cent from January 2015.

The central bank on Monday released the final Basel III framework on liquidity standards, which includes guidelines on liquidity coverage ratio (LCR), liquidity risk monitoring tools and LCR disclosure standards.

"The LCR requirement would be binding on banks from January 1, 2015. With a view to provide a transition time for banks, the requirement would be minimum 60 per cent for the calendar year 2015, with effect from January 1, 2015," the RBI said in a release.

The LCR promotes short-term resilience of banks to potential liquidity disruptions by ensuring that they have sufficient high quality liquid assets to survive an acute stress scenario lasting for 30 days.

DH Newsletter Privacy Policy Get top news in your inbox daily
GET IT
Comments (+)