Bank liquidity management Student’s Name Institution Bank liquidity management Basel III were the new global standards that were intended to strengthen the resilience of the global banking institutions. They were the international framework that were put in place for liquidity risk measurement and monitoring (International 2012). These standards were issued in December 2010 by the Basel Committee on the Banking Supervision. Among these requirements were the Liquidity Coverage Ratio framework which was implemented in Australia in January 2015 and the Net Stable Funding Ratio that will be introduced in the year 2018. Liquidity Coverage Ratio Framework Liquidity Coverage Ratio (LCR) can be defined as the ratio of the company’s high-quality liquid asset (HQLA) amount to its projected net cash outflow that is considered Funding Ratio will promote comprehensive bank liquidity management through limiting over-reliance on the wholesale funding when it comes to the periods of buoyant market (Jang et al 2012). At the same time it same time this standard encourages a better assessment of liquidity risk when it comes to both on and off-balance sheet items. References Hall M. (2003). The international handbook on financial reform. Cheltenham U.K: Edward Elgar. International M. F. (2012). Australia: Basel core principles for effective banking supervision. Place of publication not identified: International Monetary Fu. Jang B. Sheridan N. & International Monetary Fund. (2012). Bank capital adequacy in Australia. Washington D.C.: International Monetary Fund. Tarullo D. K. (2008). Banking on Basel: The future of international financial regulation. Washington DC: Peterson Institute for International Economics. [...]
As part of Basel III liquidity requirements, the Liquidity Coverage Ratio framework was implemented in Australia in January 2015, while the Net Stable Funding Ratio will be introduced in 2018.Peovide an overview of these two requirements and discuss how they may help promote more comprehensice bank liquidity management?