Banking regulation: liquidity requirements

Abstract

[eng] Over the years, the banking sector is known as the liquidity provider for the rest of the world. But sometimes this system also faces few failures, and their managers detect the need to be regulated. Therefore, Committee on Banking Supervision implemented LCR and NSFR models for banks. With these instruments, financial institutions find easier to manage and fulfil the requirements of their clients and the economy. Even though, these models can also have some aftereffects, to tackle them Central Bank is established as the spine of this system, so it could help commercial banks.