Regulatory Alerts2015-06-16
Liquidity Coverage Ratio
The Supervisor of Banks in Israel issued this directive to implement the Basel III Liquidity Coverage Ratio framework, requiring banking corporations to maintain an adequate stock of High Quality Liquid Assets. The regulation mandates that these assets cover total net cash outflows over a 30-day stress scenario, with a minimum ratio of 100 percent once fully phased in by January 2017. It defines the characteristics of eligible assets, operational requirements for unencumbered holdings, and specific application rules for domestic banks and foreign branches.
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