New Regulation On Liquidity Coverage Ratios

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The Banking Regulation and Supervision Agency (BRSA) continues to transpose the international regulatory capital standards recommended by the Basel Committee (known as the Basel III standards) into Turkish law. Recently, the BRSA has issued the Regulation on Liquidity Coverage Ratios (Regulation), published in the Official Gazette dated 21 March 2014 and numbered 28948. This Regulation seeks to ensure that a bank maintains an adequate level of high quality liquid assets (HQLA) on a consolidated and non-consolidated basis to meet the net cash flows. The Regulation entered into effect immediately with the provisions thereof becoming applicable as of 1 January 2014 (with the exception of certain provisions relating to minimum coverage ratio levels and the consequences of failing to maintain compliance, which will enter into effect on 1 January 2015).