Question ID
2013_293
Legal act
Regulation (EU) No 575/2013 (CRR)
Topic
Liquidity risk
Article
412
Paragraph
1
COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations
Not applicable
Article/Paragraph
na
Name of institution / submitter
European Banking Federation
Country of incorporation / residence
Belgium
Type of submitter
Industry association
Subject matter
Minimum reserve requirement
Question

What is the requirement to maintain the minimum reserve requirement within the LCR period, i.e. does the LCR have to be met for each of the 30 days in the stress horizon?

Background on the question

NA

Submission date
Final publishing date
Final answer

In accordance with Article 412(1) of Regulation (EU) No. 575/2013 (CRR) institutions shall hold liquid assets, the sum of the values of which covers the liquidity outflows less the liquidity inflows under stressed conditions so as to ensure that institutions maintain levels of liquidity buffers which are adequate to face any possible imbalance between liquidity inflows and outflows under gravely stressed conditions over a period of 30 days.  As a consequence, the liquidity coverage requirement shall apply at all times. During times of stress, institutions may use their liquid assets to cover their liquidity outflows in accordance with the circumstances specified in Article 414 of the CRR.

Status
Final Q&A
Answer prepared by
Answer prepared by the EBA.
Note to Q&A

Update 26.03.2021: This Q&A has been reviewed in the light of the changes introduced to Regulation (EU) No 575/2013 (CRR) and continues to be relevant.

Disclaimer

The Q&A refers to the provisions in force on the day of their publication. The EBA does not systematically review published Q&As following the amendment of legislative acts. Users of the Q&A tool should therefore check the date of publication of the Q&A and whether the provisions referred to in the answer remain the same.