1/7/2013

The Basel Committee on Banking Supervision has granted a four-year reprieve and phase-in period for its liquidity-coverage ratio, a step that banks had argued was necessary to sustain lending. Originally, banks were required to have in 2015 sufficient liquid assets to cover expected outflow over 30 days. The date for that has been changed to Jan. 1, 2019, with banks needing to show a 60% ratio in 2015. "[The Group of Governors and Heads of Supervision have] rescued the concept of a global liquidity rule, but its reality remains up in the air," said Karen Shaw Petrou, managing partner of Federal Financial Analytics.

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