Regulatory Alerts2016-07-21
Guidance Note 6/2016: Provision of a Committed Liquidity Facility by the South African Reserve Bank
The South African Reserve Bank issued Guidance Note 6/2016 to establish revised operational, collateral, and pricing guidelines for its Committed Liquidity Facility, which assists banks in meeting Liquidity Coverage Ratio requirements between December 2016 and November 2017. The facility caps eligible drawdowns at 40 percent of a bank’s required High Quality Liquid Assets, updates haircuts on eligible collateral, and mandates quarterly reporting with internal audit sign-off for assets transferred to special purpose institutions. Participating banks must pay an annual commitment fee of 58 basis points regardless of utilization, with drawdowns priced at the SARB repo rate plus 100 basis points and strictly limited to a 31-day period.
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