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Summary

In this study, we show that the banks optimise their liquidity position at the points in time on which the...

Introduction

Liquidity risk and regulations

Why is liquidity risk regulated? Two international liquidity metrics

New liquidity metric measures the banks’ ability to cope with deposit outflows

Deposit Loss Capacity How have the banks’ cash flows been affected by LCR and NSFR? Different views of the liquidity reserve What is an appropriate DLC level? Limitations of DLC DLC for the large banks in Sweden

Concluding remarks

References

Appendix

Authors: Ida Hansson and Tobias Lindqvist

About the Riksbank's Economic Commentaries

Economic Commentary

Economic Commentaries are brief analyses of issues with relevance for the Riksbank. They may be written by individual members of the Executive Board or by employees of the Riksbank. Employees’ commentaries are approved by their head of department, while Executive Board members are themselves responsible for the content of the commentaries they write.

Could the banks cope with large deposit outflows? Assessment according to a new liquidity metric

No. 7 2022, 9 May

Economic Commentary

No. 7 2022, 9 May

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