• Basel III Liquidity Framework: Federal Reserve Issues Basel III Liquidity Coverage Ratio Proposal for Large U.S. Banks
  • November 1, 2013
  • Law Firm: Sullivan Cromwell LLP - New York Office
  • On Thursday, October 24, the Board of Governors of the Federal Reserve System (the “FRB”) approved for publication a notice of proposed rulemaking (the “Proposal”) to implement a quantitative liquidity coverage ratio (“LCR”) requirement for certain large domestic bank holding companies, saving s and loan holding companies, depository institutions and nonbank financial companies designated by the Financial Stability Oversight Council (the “FSOC”). The Proposal is a joint rulemaking of the FRB, the Office of the Comptroller of the Currency (the “OCC”) and the Federal Deposit Insurance Corporation (the “FDIC” and, together with the FRB and the OCC, the “Agencies”). The LCR is intended to ensure that these banking organizations hold sufficient stocks of “high quality liquid assets” (“HQLA”) to survive an acute 30 day liquidity stress scenario.