Thus, while we are aware of the need to reduce the group borrower limit, we have to take a considered view as to what extent and how smoothly this can be brought down going forward without adversely impacting the growth prospects of the economy. Liquidity standards – treatment of the SLR holdings 37.
During the early “liquidity phase” of the financial crisis that began in 2007, globally many banks faced unprecedented difficulties despite adequate capital levels. The Basel Committee on Banking Supervision (BCBS) recognized that such difficulties were due to lapses in basic principles of liquidity risk management.