PREVIOUS
✖
LCR maintenance
January 16 , 2022
947 days
669
0
- The Reserve Bank of India has increased the threshold limit for Banks to maintain the Liquidity Coverage Ratio (LCR).
- It will be on deposits and other ‘extension of funds’ received from non-financial small business customers from Rs 5 crore to Rs 7.5 crore.
- This is applicable on all Commercial Banks other than Regional Rural Banks, Local Area Banks, and Payments Banks.
- It is to align RBI’s guidelines with the Basel Committee on Banking Supervision (BCBS) standard and enable banks to manage liquidity risk more effectively.
- LCR promotes the short-term resilience of banks to potential liquidity disruptions.
- It will ensure that they have sufficient high-quality liquid assets (HQLAs) to survive an acute stress scenario lasting for 30 days.
Leave a Reply
Your Comment is awaiting moderation.