EU banks watchdog says lenders ahead of liquidity rule

Banks will have to hold a so-called liquidity buffer made up of top quality assets akin to cash, such as government bonds, that can be sold easily so that lenders can withstand short-term shocks unaided by taxpayers. The buffer, known as a liquidity coverage ratio or LCR, will be phased in from 2015 with full compliance by 2019. The European Banking Authority (EBA) said data provided by 357 banks covering about two-thirds of total EU banking assets showed an average LCR of 115 percent, or above what is required. EBA also endorsed the LCR definition agreed at the global level by the Basel Committee, signaling resistance to calls to water it down.

    

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