Fed targets tougher LCR for US banks
The Federal Reserve is pushing for new liquidity requirements on US banks that go above and beyond the Basel III minimum standards while complementing its existing package of reforms.
Fed chair Ben Bernanke unveiled proposals to impose a liquidity coverage ratio (LCR) – the first ever 'quantitative liquidity' requirement in the US – on the country's largest financial institutions.
An LCR requires banks to hold enough high-quality liquid assets (HQLAs) to cover the amount of cash that would be
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