Regulatory Alerts2020-05-06 | 2020-09716Liquidity Coverage Ratio Rule: Treatment of Certain Emergency Facilities
The Office of the Comptroller of the Currency, Federal Reserve Board, and FDIC issued an interim final rule requiring banking organizations to neutralize the Liquidity Coverage Ratio effects of participating in two Federal Reserve emergency facilities. The rule excludes advances from the Money Market Mutual Fund Liquidity Facility and Paycheck Protection Program Liquidity Facility, along with their securing collateral, from standard outflow and inflow calculations. This neutralization ensures consistent, predictable liquidity risk assessments for covered companies throughout the duration of these pandemic-era credit programs.
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