Regulatory Alerts2021-06-26
Regulation on the Liquidity of Institutions (Liquidity Regulation - LiqV)
The German Federal Ministry of Finance issued this regulation to implement EU liquidity standards for credit institutions not fully covered by Regulation (EU) No 575/2013. It mandates that institutions maintain a liquidity ratio of at least 1.0 by classifying cash and payment obligations into four maturity bands and calculating specific observation ratios. Institutions may alternatively use internal liquidity risk measurement and control systems, provided they obtain prior written approval from the Federal Financial Supervisory Authority (BaFin) and meet strict operational and reporting requirements.
Share