Liquidity rules for large banking firms Last week, the Federal Reserve and the other U.S. banking agencies approved a final rule, consistent with the enhanced prudential standards requirements in section 165 of the DoddFrank Act, which implements the first broadly applicable quantitative liquidity requirement for U.S. banking firms.
Liquidity standards for large U.S. banking firms are a key contributor to financial stability, as they work in concert with capital standards, stress testing, and other enhanced prudential standards to help ensure that large banking firms manage liquidity in a manner that mitigates the risk of creditor and counterparty runs.