With a 66.7% LCR, Bank A does not meet the regulatory minimum of 100% or greater. If Bank A has $100 million in HQLA and expects to have $150 million in net cash outflows over the next 30 days, its LCR would be calculated as follows: Examples of the LCRīelow are some examples of how to calculate a bank’s LCR and interpret it. Regardless of the LCR value, the bank must ensure it meets this requirement. Since the total value of a bank’s high-quality liquid assets and its projected net cash outflows may change monthly, its liquidity coverage ratio is also expected to adjust accordingly. ![]() Net Cash outflows are the short-term liabilities a bank must fulfill during the upcoming 30-calendar-day period.įor instance, it can include the estimated cash withdrawals and payments a bank expects to make. They have a 25% - 50% discount, so only 50% - 75 % of their face value is included in the LCR calculation.
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